December 8, 2019 (MLN): The outgoing week observed a series of different events that reveal the current standing of Pakistan's economy.
To begin with, on Friday, the Asian Development Bank (ADB) approved a $300 million policy-based loan that will help the Government of Pakistan to address financial sustainability, governance, and energy infrastructure policy constraints in Pakistan’s energy sector.
In addition, the Asian Development Bank (ADB) also approved $1 billion in immediate budget support to Pakistan to shore up the country’s public finances and help strengthen a slowing economy.
The same day, the Oil and Gas Regulatory Authority (OGRA) notified revised prices of Regasified Liquefied Natural Gas (RLNG) for the current month as per which there is $0.1151 per mmbtu (Million British Thermal Unit) decrease in sale price of imported RLNG on the system of Sui Southern Gas Pipelines Company (SSGC) for the month of November as compared to the last month. The new price of the RLNG for SSGC system has been fixed at $ 10.8234 per mmbtu.
On Thursday, the Securities and Exchange Commission of Pakistan (SECP) and Asian Development Bank (ADB) jointly organized a workshop for stakeholder consultations on Financial Market Development 2020-25 to broaden and deepen the financial system in Pakistan.
On the upside, Moody’s investor service changed the outlook of five Pakistani Banks from negative to stable, affirming the B3 long term local currency deposit ratings owing to the banks' high exposures to government securities. The banks include; Allied Bank Limited (ABL), Habib Bank Limited (HBL), MCB Bank Limited (MCB), National Bank of Pakistan (NBP) and United Bank Limited (UBL).
On Wednesday, adviser on Finance and Revenue Dr Abdul Hafeez Shaikh said significant progress has been made in the microfinance sector and now the sector is yielding positive results in the shape of creation of job opportunities and boosting economic activities in the country.
Besides, he also said that leading international financial institutions were recognizing the substantive efforts of Pakistan's economic team which led to stabilization of macroeconomic indicators.
On Tuesday, Governor SBP, Dr Reza Baqir, welcomed Moody's change in outlook on Pakistan from negative to stable. He noted that this positive development reflects the recognition of tough decisions taken by the economic policymakers over recent months including the step devaluations of the exchange rate that culminated in the change in the exchange rate regime to a market-based system since May 2019.
Moreover, Pakistan paid back more than $1 billion against five-year Eurobond on Monday. The international Sukuk matured in November 2019 which the PML-N government has obtained in November 2014 at a rate of 6.75%.
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