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State Bank’s Forex Reserves Increase by USD 73.90 Million

Feb 20, 2020 (MLN): Pakistan's Forex Reserves increased by USD 11.70 Million or 0.06% and the total liquid foreign reserves held by the country stood at USD 18,747.10 Million on Feb 14, 2020.

According to data published by the State Bank of Pakistan (SBP) its reserves increased by USD 73.90 Million while those held by the Commercial Banks decreased by another USD 62 million.

Summary of Holding and Weekly Change

Foreign reserves held byFeb 14, 2020Feb 07, 2020Change% Change
State Bank of Pakistan12,504.7012,430.8073.900.59%
Net Foreign Reserves Held by Banks6,242.406,304.60-62.20-0.99%
Total Liquid Foreign Reserves18,747.1018,735.4011.700.06%

Amount in USD Million

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PSO to resume supply to Karachi from its Kaermari...

February 20, 2020: PSO Management has decided to resume the company’s operations at the Kaemari Terminal, Karachi.

After careful review of the Health & Safety situation at the Kaemari and based on consultation with relevant stakeholders, the management of the company has decided to begin limited operations at the initial stage.

The health & Safety of the PSO staff and contractors is the top priority of the company. In case the situation remains normal, PSO will start its operations on a full scale later during the day.

With the resumption of fuel supply from Kaemari, the supply of POL products to Karachi is expected to improve significantly.

During the last 36 hours, PSO teams, the company’s dealers and their staff, and contractors have been working round the clock to ensure an uninterrupted supply of POL products to Karachi.

Most of the company sites in the city were topped-up more than twice, and in areas with high demand, thrice in the last 24 hours. This enabled PSO in amicably managing the increased demand for POL products from customers which remained more than usual.

The company has ample stock of fuel available in Pakistan. With the opening of the Kaemari, all 23-company terminal in Pakistan is supplying petroleum products to all parts of the company, including Karachi, in an efficient and smooth manner.

Press Release

CCP approves Uber-Careem merger with pro-competitive, powerful conditions

February 20, 2020 (MLN): The Competition Commission of Pakistan approved the Uber-Careem merger through a Phase-II Order, imposing pro-competitive and tough conditions ensuring a level playing field for the new entrants/competitors in the app-based Ridesharing market.

The conditions will remain applicable on Uber up to three years after the merger or until the occurrence of Meaningful Market Entry of competitors. Meaningful market entry will occur when one or more Ridesharing Services Provider(s) enter Pakistan and achieve individually at least 25% (market share), or collectively at least 33.3% (market share) of weekly ridesharing trips on average for three consecutive months. This condition will allow competitors to grow and flourish in the app-based Ridesharing market and for the merged entity not to abuse its dominant position.

The CCP opened a Phase-II review of the merger as it was resulting in a significant lessening of competition in the market for app-based Ridesharing Services. In its Phase II-Order, the CCP has imposed certain conditions on Uber to address the competition concerns regarding an increase in prices of products or services, discriminatory pricing, degradation in quality of services, and possible lack of innovation.

The CCP has imposed a "No contractual Exclusivity" condition to ensure that drivers or captains are free to offer their services on any Ridesharing platform they choose, as well as being street hailed.

Uber shall maintain the contractual Service Fee for UberGo and UberMini across all drivers, nation-wide, in the range of 22.5% to 27.5%. This Service Fee cap will ensure that drivers or captains do not see a decrease in their earnings.

The CCP has directed Uber to apply a cap of 12.5% per year on the Total Organic Fare charged to riders for a trip, to protect consumers from unreasonable increase in fares.

Moreover, Surge is a pricing mechanism to raise fares during peak or rush hours. The CCP has directed Uber to apply a ceiling on its Surge multiplier at a maximum level of 2.5 times the non-surge price on the applicable products Pakistan-wide. This will protect the consumers from unrealistic hike in the fare, during peak hours.

These conditions will ensure that there is no unreasonable increase in prices post-transaction, thereby protecting consumers from burdensome increases in fares.

Another important condition is that Uber shall grant access on a one-time basis to new/existing Ridesharing service providers “point of interest map data” against the payment of applicable license fee. The CCP was of the view that control of data by a single undertaking with market power is significant barrier to entry. This condition would offset any increase in the market power or the elimination of competitive constraints and ensure the ease of entry into the market.

To address its concern that Uber continues to bring innovation to its business after the merger, the CCP has directed Uber to dedicate 10 engineers to work on R&D activities focused on product, service innovation. To address the issue, Uber has committed to introduce a DOST/Hero application, which will enable drivers to earn money while not driving by recruiting other drivers.

Moreover, Uber will introduce safety features within the driver application wherein the riders can complain about the driver’s behavior or vice versa. An Uber Lite version of the application will also be introduced that runs on low bandwidth mobile networks and also on older Android phones.

To address the CCP’s concerns about potential exploitation of riders, Uber shall not introduce Personalized Pricing in Pakistan. This ensures that the post-transaction entity will not be able to charge different prices to different Riders for similar journeys.

All these conditions will apply until the earlier of (a) three-year anniversary of the completion of the Transaction or (b) the occurrence of National or Local Meaningful Market Entry.

To ensure compliance with these conditions, Uber shall engage a third-party Monitoring Trustee who will submit a regular compliance report to the CCP

In view of the above, the Commission believes that, although the transaction will result in increased market power and decreased competitive constraints, the conditions it is imposing on Uber sufficiently address its competition concerns. The transaction, therefore, has been authorized under Section 31(1)(d)(i) of the Competition Act, 2010.

Press Release

Virus fears weigh on European stock markets

Feb 20, 2020: Coronavirus fears weighed on European stock markets Thursday despite China reporting a big drop in new cases and easing borrowing costs to cushion the epidemic's economic impact.

Traders have been betting on central banks, particularly China's, doing what it takes to keep their economies chugging along as the new coronavirus hits corporate earnings and economic growth.

In a widely anticipated move, the People's Bank of China (PBoC) lowered its one-year and five-year loan prime rates as policymakers seek to reduce the impact of the virus-fuelled slowdown on companies and households.

But the moves were "not nearly enough", said Stephen Innes of AxiCorp.

"The PBoC needs to exceed the market expectations, not hit them in this environment," he said.

"If the PBoC made a bigger splash, the market would have reacted more favourably" than the 1.8-percent gain Thursday for Shanghai's main stocks index.

Sentiment had improved in recent days amid growing hopes that the impact of the virus -- which has killed more than 2,100 people and infected over 74,000, mostly in China -- will be short-lived.

China reported a big drop in new cases on Thursday, fuelling hopes the epidemic is nearing its peak.

In the best-case scenario, the economic hit from the epidemic in China will be short-lived, but it comes as the global economy remains fragile, IMF chief Kristalina Georgieva said Wednesday.

Overnight gains on Wall Street boosted Asian equities at the start of trading before gains evaporated.

European stock markets were slightly lower approaching the half-way mark, with a rebound for British retail sales failing to ignite the pound and London's benchmark FTSE 100 stocks index.

Elsewhere Thursday, oil prices were mixed as traders assess the virus' impact on demand for crude in China, the world's biggest importer and consumer of the commodity.

Oil traders were tracking also unrest in crude-producing nation Libya.

The country's unity government has announced it is halting its participation in UN talks aimed at brokering a lasting ceasefire in the war-torn country where a fragile truce has been repeatedly violated.

AFP/APP

Oil supplies from PSO, SHELL and TOTAL terminals at...

February 20, 2020 (MLN): The supply of oil from terminals located at the Kemari Town has resumed as of Thursday.

For the uninitiated, the supply of oil from various terminals, including those of PSO, SHELL, and TOTAL, had been disrupted after the Kemari Port was hit by an oil/gas leakage on Sunday night.

As a result of this calamity, the terminals of the abovementioned Oil Marketing Companies were shut down temporarily.

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