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Profit Repatriation drops 55% YoY in July

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August 26, 2021 (MLN): Multinational companies operating in Pakistan repatriated $159.2 million in profit and dividends on investments in the country during July 2021 which was 55% lower than the profits of $354.5mn repatriated in July 2020, the central bank data showed on Thursday.

The data further revealed that during the month, foreign companies repatriated $141.1mn worth of profit against the foreign direct investments (FDI) in various businesses compared to $340.2mn in July’20. While the outflow as payment against portfolio investment stood at $18.2mn, compared with $14.3mn in the same month a year earlier, marking an increase of 27% YoY.

To note, Foreign direct investment (FDI) fetched by the country amounted to $89.9mn in July’21, lower than repatriation of profits and dividends of $159.2mn in the same month of the current fiscal year.

Sector-wise:

The data shows that the major sectors that repatriated relatively higher profits include Communication sector, Food Packaging, Financial Businesses, Chemicals, and Power sector, among which Communication sector repatriated highest profits of $62.5mn during the month to overseas, against $61.2mn in the last fiscal year, showing a slight growth of 2% YoY.

The data further revealed that Profit outflows from the Food Packaging clocked in at $26.8mn while in July 2020, the sector did not fetch any profit. Profits outflow from the Financial Businesses declined by 74%YoY to $23.3mn against an inflow of $90mn in July’20.

The Chemical sector repatriated $13.8mn in July’21, which was 26% lower when compared with $18.7mn in the same month previous fiscal year.

The Power sector repatriated $9.6mn, which was 625% higher as it had sent $1.3mn during July’20.

Country-wise:

A country-wise break up of data on repatriation of profit released by SBP revealed that firms and individual investors belonging to the Netherlands dispatched the single largest profit of $47.1mn during the month compared to $1.9mn in the same month prior fiscal year.

Switzerland witnessed the repatriation of the second-highest profits as the country repatriated $33.1mn abroad during the month under review, compared with $17.9mn in the previous year.

Third in line is UK which repatriated $26.3mn from Pakistan during the month, down by 85% YoY as last year in July, the country remitted $179.7mn as profit income from Pakistan.

Next followed by China with profit repatriation of $16.3mn which was 56% higher when compared with last year's figures.

Copyright Mettis Link News

Posted on: 2021-08-26T17:49:00+05:00

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