http://www.nation.com.pk/daily/jan-2007/23/bnews2.php

Foreign investment surges to $2.5 billion

ZAMIR SHEIKH



KARACHI - Inflow of total foreign investment in Pakistan has increased to$2.5 billion during first six months of the current fiscal year as compared to the last year corresponding period.

During July-Dec 06, the total direct investment inflow stood at $1.869 billion against the $1.121 billion in the same period of last fiscal, which showed an increase of $748.3 million.

The inflow of portfolio investment during July-Dec of current fiscal year registered at $627.1 as compared to last corresponding period recorded to US$359.3 million, which depicted an impressive growth of $267.8 million. The total investment poured during July-Dec of current fiscal year stood at $2.50 billion as compared to $1.48 billion in corresponding period of fiscal year 06.

The contribution of developed countries in the investment during first six month of current fiscal amounted to $1.719 billion against $923.2 million during first six months of last fiscal showing increase of $795.9 million. Similarly, the inflow from Western Europe during July-Dec of current fiscal recorded at $880.4 million against $416.6 million during same period of last fiscal, showing $464.4 million increase this year.

Investment from the European Union countries was to the tune of $762.7 million in the first six months of year 06-07 against $221.2 million in same period of last fiscal, indicating an increase of $541.7 million. The UK made investment to the tune of $683.6 million during July-Dec of 06-07 as compared to $110.7 million during first six month of the last fiscal that showed an increase of $772.9 million.

The inflow of investment from North America during July-Dec of current fiscal registered at $770.7 million against $470.1 million as compared to same period of last fiscal showing increase of $300.6million. The USA investment of $769.0 million came to Pakistan during first six months of current fiscal against $467.2 million registered an increase of 301.8 million dollar. The developing economies contributed $569.9 million during July-Dec of current fiscal compared to $488.4 million investment during same period of last fiscal increasing $81.5 million.

Investment inflow from Asia recorded to $498.0 million in July-Dec 06-07 against $436.2 million in same period of last fiscal increasing by only $61.8 million.

Officials said that the launching of the GDRs of the OGDCL played a key role in attracting more portfolio investment in six months of this financial year.

They said that the federal government had estimated the inflow of $4.5 billion to $5.0 billion in fiscal year, 2007 that seems achievable keeping in view the current trend of the inflow of foreign investment.

This is very good news and will power up the economy.

http://www.dailytimes.com.pk/default.asp?p...23-1-2007_pg5_2


$2.36b record investment received sans privatisation

* Total foreign investment up 68.6% in July-Dec
* Portfolio investment increases by 74.5%

By Arshad Hussain

KARACHI: It is the first time that the country’s total foreign investment has surged to a record level by 68.6 percent to $2.496 billion without privatization proceeds in July-Dec 2006-07 compared with $1.481 billion received in the same period last year.

Portfolio investment surged by 74.5 percent to $627.1 million in the first half against $359.3 million received by the local bourses last year. Pakistan received direct investment of $1.869 billion with privatization proceeds in July-December after surging by $748.3 million, or 66.7 percent, according to data released by the State Bank of Pakistan (SBP) here on Monday.

During the period, the government received only $133.2 million from the privatization proceeds in the telecommunication sector from the United Arab Emirates (UAE).

In spite of frequent decline at the local bourses, portfolio investment has not only significantly improved during the last six months, analysts said, but also indicates stability in the coming six month.

An analyst said: “Direct investment figures announced by the central bank are encouraging for the government and its policies. The country has received an amount of $1.736 billion in the last six months, which shows that the government could easily achieve its FDI target of $4 billion for the current fiscal year.”

The data of the central bank shows that the SBP has received only $223.5 million from the UK under the portfolio investment. This amount could be of the Global Depository Receipt (GDR) of the Oil and Gas Development Company Limited (OGDC) at the London Stock Exchange (LSE) held in October or November last year. The Privatization Commission has completed its first GDR by selling its share of around $812 million. “It would be the highest ever figure of direct investment received during the last six months as compared with the last few years,” the analyst said. Last year, the country had received $1.8 billion from privatization proceeds out of the total foreign investment of $3.872 received in 2005-06.

Recently, the Privatization Commission has announced that it will hold GDR of the government’s holdings in National Bank of Pakistan, Habib Bank and Allied Bank to raise foreign investment.

News coming from the Privatization Commission said the GDR of these banks would be held in the current fiscal year, but did not give the exact date, the analyst said.

The Privatization Commission is also finalizing the sell-off of Pakistan State Oil (PSO), the country’s largest oil marketing company, by March.

Portfolio investment from the USA shot up to $302 million in July-Dec 2006-07 compared with $230 million in the same period last year. Major investment at the local bourses was from Singapore, which stood at $107.7 million in July-Dec 2006 compared with the withdrawal of one million US dollars in the same period last year.

In direct investment, the European Union invested of $541 million in the last six months compared with only $194 million in the same period last year. The United Kingdom invested $460 million in the last six months, while such investment stood at $87 million in the same period last year. During the first half of the current fiscal year, the financial business sector of the country remained on top that received $517 million, the telecommunication sector got $472 million, the storage facilities sector received $495.2 million and the oil and gas exploration sector received $315 million.

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FDI up 67 percent in H1 of 06/07: SBP


KARACHI (updated on: January 22, 2007, 21:08 PST): The country's Foreign direct investment (FDI) rose 67 percent to $1.87 billion in the first half of the 2006/07 fiscal year, led by inflows into the communications, energy, and banking and financial services sectors, official figures show.

Data released by State Bank of Pakistan on Monday showed that the FDI for the July-December period rose from $1.12 billion in the corresponding period last year.

Inflows from foreign portfolio investment during the six months were $627 million, up from $359 million in the corresponding period last year.

The United States led the list of foreign investors with direct investment of $468 million during the period, followed by the United Kingdom with $460 million and the United Arab Emirates with $251 million.

Inflows generated by privatisation amounted to $133 million in the six month period, compared with $254 million in the year-ago period.

The banking and financial services sectors attracted the most foreign investment during the period, $517 million, followed by $495 million invested in the communications sector, and $315 million in oil and gas exploration.

Asia-focused Standard Chartered's $487 million take-over of Union Bank Ltd. accounted for most of the funds attracted by the financial sector, though not all the money paid has come to Pakistan.




Copyright Reuters, 2007

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Record FDI expected this year: Zahid



By our correspondent

KARACHI: “Pakistan is heading for new records for total Foreign Direct Investment (FDI) this year, which has already exceeded $3.3 billion during the first half of the current financial year.

Zahid Hamid, Federal Minister for Privatisation & Investment and Chairman of Privatisation Commission stated this while addressing the Privatisation Commission Board meeting at Islamabad on Tuesday.

The minister informed the PC Board that Foreign Investment figures continued to reach record levels during the current financial year. The FDI during the first half July-December 2006 was $1.87 billion, which is 69 per cent higher than the amount during the corresponding period last year. Portfolio investment in this period was $627 million while GDR receipts of MCB and OGDCL are $150 million and $731 million respectively. Hence total Foreign Investment during the first half of FY 2006-07 exceeded $3.3 billion, he said.

The PC Board reviewed the progress regarding privatisation of Pakistan State Oil Company Limited (PSO) through the proposed sale of 51 per cent shares along with management control.

The PC Board expressed satisfaction over encouraging response from reputable local and foreign investors to the PC notice inviting fresh EoIs, which was an indication of their appreciation of the country’s economic performance and confidence in the privatisation and investment policies of the government.

Board constituted a six-member Transaction Committee to supervise various stages of the process including pre-qualification of parties to enable them to enter into the data room for necessary due diligence. The Committee will make every effort to expedite the process so as to bring the transaction to the bidding point as soon as possible.

Meeting noted with appreciation that the domestic retail offering of OGDCL have been oversubscribed by 38 per cent following the successful GDR offering last month. The Board reviewed the progress on transactions relating to IPO of HBL and GDRs of UBL, NBP, KAPCO and HBL and gave necessary directions to expedite the same.

The Jamshoro Power Company transaction was also discussed in depth and it was decided to expeditiously resolve all pending matters so as to bring it to the bidding stage.

The Board was informed that the PC had received ten Expressions of Interest (EoIs) and Statements of Qualification (SoQs) from the interested parties to participate in the privatisation process of Heavy Electrical Complex (HEC), while eight EoIs and SoQs had been received in respect of Hazara Phosphate Fertilizers Ltd (HPFL).

The Board was also informed that the process had been initiated for the privatisation of Pakistan Mineral Development Corporation’s (PMDC) Coal and Salt mines by inviting EoIs for appointment of Financial Advisor.

The PC Board also discussed the work of the ‘Future Portfolio Committee’ constituted to formulate recommendations for processing new transactions from the approved list of the Council of Common Interests (CCI).

The PC Board members and senior representatives of the respective ministries and departments were present in the meeting.