But a reality check will quickly make him realise the tough task ahead in turning around an increasingly vulnerable economy. A country without regular electricity supplies can’t put too much faith in something as fickle as a stock market rally. Continue reading »
With a 17 per cent rally this year in the Pakistan stock market driven largely by hopes of a Nawaz Sharif election win, it might have seemed that his apparent victory was in already in the price.
But investors clearly believe there is still a little more juice the engine. The benchmark KSE 100 index rose 1.6 per cent to a record high in Monday trading, as many business people celebrated the former prime minister’s expected return to power. Continue reading »
They’ve driven the market to record highs on the prospect that opposition leader Nawaz Sharif will be returned to power. On Tuesday the exchange’s KSE-100 broke through the 19,000-level for the first time and more record highs are expected before the election’s over. Continue reading »
Almost two weeks have passed since prime minister Mir Hazar Khan Khoso took charge to oversee parliamentary elections due on May 11. While he has named a 14-member cabinet, Khoso still does not have a finance minister. Continue reading »
The decision by Pakistan’s central bank on Friday to cut its discount rate by 50 basis points to 9.5 per cent was a widely-anticipated move – a measure meant to give an impetus to new investments, and part of an easing cycle of 250 bp this year. The interest rate cuts are helped by falling inflation which is forecast to stay below 10 per cent for the financial year to June 2013, down from 12-14 per cent a year ago.
But long term watchers of Pakistan’s economic trends are eager to note that new investments have plummeted in the past four years since president Asif Ali Zardari led the country back to democracy. Continue reading »
With elections looming in Pakistan by summer 2013, prime minister Raja Pervez Ashraf has ordered officials from the ministry of petroleum and natural resources to make certain that there are no shortages of gas this winter.
Ashraf’s order follows some of the shortages of electricity earlier this year which prompted angry street protests. Any repeat of demonstrations over gas shortages as winter temperatures get near freezing in parts of Pakistan – as happened last year (pictured) – would hardly help the prospects of Ashraf’s ruling Pakistan People’s Party (PPP) returning to rule the country for another five years. Continue reading »
What’s a finance minister to do when his own cabinet colleagues disbelieve his figures?
Abdul Hafeez Shaikh, Pakistan’s finance minister, is finding out the hard way. The respected former World Bank economist has had his inflation data challenged by other ministers, with one of them saying the figures are “out of tune with reality”.
It’s not that his colleagues are interested in statistics. But they are very interested in the parliamentary elections due to be held by the middle of next year – and they’re scared the voters will be angry with the official data. Continue reading »
The plight of Malala Yousafzai, the Pakistani schoolgirl shot by the Taliban for publicly demanding the right of women to be educated, has shone a global spotlight on the failings in the country’s social development. Continue reading »
Pakistan’s equity investors are eagerly awaiting news from the country’s central bank when it reveals its policy on future interest rates on Friday.
On Thursday, the Karachi Stock Exchange’s main index, the KSE-100, reached an all-time high of 15,815 points, comfortably overtaking the previous peak reached in April 2008. In part, the enthusiasm was driven by falling interest rates. But would further cuts finally get the economy moving? Continue reading »
What do you do about attracting investment if you are a remote corner of China, best-known internationally for your ethnic tensions?
If you are Xinjiang, you invest heavily in a blockbuster economic exhibition. Urumqi is this week hosting its second annual China-Eurasia Expo, opened this year by premier Wen Jiabao, a clear upgrade from last year’s star host, vice premier Li Keqiang.
Leaders and/or ministers from seven countries flew in, giving credence to Wen’s claim that the Expo aimed ‘to build a new bridge of friendship and cooperation across the Eurasian continent…and make Xinjiang a gateway.’ But it’s along way from prime ministerial declarations to the investment that Xinjiang badly needs. Continue reading »
And that is true in a literal sense as well. For more than a year, Pakistani cities have faced up to 20 hours a day without electricity. The blackouts are putting a drag on economic growth, stalling everyday life for many Pakistanis and sparking mass protests across the country.
Mark Mobius, executive chairman at Templeton Emerging Markets, tells the FT’s Henny Sender that volatility is the biggest worry, not just for emerging markets but for all markets around the world. Meanwhile, frontier markets such as Pakistan are worth considering for investment, especially when the news is at its worst.
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