Times Square in Lahore: Hydra of Abu Dhabi teams up with DHA Lahore on $1.4B project
A preliminary design shows Lahore's upcoming Times Square - 17 skyscrapers between 29 and 42 stories tall!
Let the good times roll! The KSE is rocketing north once more, foreign exchange remittances by Pakistanis abroad are hitting all time highs and property deals are happening left, right and center. The Pakistani economy is booming, baby!
I was thrilled to see a recent announcement by the much respected Defence Housing Authority, Lahore, concerning their partnering with the now-famous UAE based property development group, Hydra. They are embarking on a massive undertaking that will contribute positively to Lahore’s rapid development, and to jobs and economic opportunities in the city. (more…)
Pakistan’s forex reserves grow to $10.21BN: IMF says goals being met and China provides additional $500M
China remains Pakistan's all-weather ally
Pakistan’s forex reserves continue to see healthy growth with the latest figures showing a $260M increase since the 1st of January, 2009. The total pool of reserves now stands at $10.21BN. With additional measures being taken to shrink the trade gap – which has already seen a major reduction – the reserves are expected to continue to rise. The $10.21BN amount does NOT include the bulk of the IMF package approved for Pakistan. An additional $4.5BN is still to be released by the IMF.
China has injected an additional $500M into Pakistan’s economy. Chinese businessmen and companies have been visiting the country frequently over the past several months, and Punjab Chief Minister Shahbaz Sharif’s successful trip to China also sealed several joint venture deals between the two countries. Chinese investments in Pakistan over the recent past now stand at $1.3BN.
Multiple factors are in play, which need to be taken into account to form a picture for where we will stand from the point of view of our economy, over the next year. Here is what we can look forward to: (more…)
Japan’s DTS to invest $50M in Karachi’s Software Park
Gorgeous Karachi is about to get another software park
The Government of Sindh has announced that DTS, a Japanese IT firm, is investing $50M to build a 5 acre software park in the SITE industrial area, along the Superhighway that connects Karachi with Hyderabad. Construction on the project has already started. Once the DTS facility is completed, it will employ between 1,200 to 2,000 people. This is significant job creation for Karachi’s IT workforce. This news, hot on the heels of several Chinese, UAE and Saudi investment announcements, underscores a positive trend towards increasing FDI in Pakistan’s technology and industrial sectors. In fact, at the inauguration ceremony for the DTS park, Mr. Hironao Takahashi, the CEO of the company announced his intent to push DoCoMo, the Japanese mobile telco behemoth, to also invest in Pakistan. How’s that for enthusiasm!
An extract from the story and the link after the break. (more…)
Singapore’s Temasek Holdings to invest $147M in Pakistan’s NIB Bank
Pakistan's NIB Bank attracts a sizeable Temasek investment
Amidst all the talk of FDI and Pakistan’s foreign exchange reserves, Singapore’s sovereign investment fund, Temasek Holdings, announced their intent to invest $147M in Pakistan’s NIB Bank. This is welcome news for NIB and Pakistan’s banking sector in general. Not only will the additional capitalization shore up NIB’s position, it will also illustrate how favourable Pakistani bank valuations are currently.
It should be noted that not one major (or minor) Pakistani bank has been shut down thus far despite the global financial crisis. Unlike the situation in many countries, particularly the USA, in Pakistan there have been no runs on banks or other reactions that showcase a widespread trust deficit. The fact that NIB, one of the country’s smaller banks, has attracted a high profile foreign investor may point to a impending larger trend. Clearly, with the arrival of Barclay’s, HSBC, Dubai Islamic Bank and many other international institutions, Pakistan has already demonstrated its ability to attract top-tier names and deliver growth.
More on the story after the fold. (more…)
China, Saudi Arabia and IMF appear ready to inject over $10BN into Pakistan’s economy
Details on this shot-in-the-arm package, said to be materializing rapidly, are still sketchy. There have been several reports in the mainstream Pakistani news media that the Finance Ministry is close to announcing a $10BN package being formulated with Saudi Arabia and China. The Saudis will contribute $6BN in the form of deferred oil payments and the Chinese are considering an injection of about $4BN.
In addition to this $10BN, IMF officials visited Islamabad and offered a multi-billion dollar support package with softer terms than the IMF typically provides. The IMF support payments were offered in $500M tranches. Pakistan has expressed its inclination to turn down the IMF offer, which seems to be consistent with the views espoused by IMF’s Asia head, Mohsin Khan. He recently stated that Pakistan didn’t really need an IMF loan. He characterized the Pakistani economy as fundamentally resilient and expressed his opinion that with a bit of “belt tightening” the current crisis could be overcome. (more…)
Saudi Arabia to defer $6BN of oil payments for Pakistan
Saudi Arabia's King Abdullah, an old friend of Pakistan's.
We had reported a few weeks ago that Saudi Arabia and Pakistan had extensive investment discussions when Prime Minister Yusuf Raza Gilani visited Riyadh recently. Part of the agreement that resulted from these discussions involved Saudi Arabia providing $4.82BN of oil on very soft, deferred terms to Pakistan. Apparently we were wrong about the amount. It’s not $4.82BN, it’s $5.9BN. Hence proving, that, bigger is indeed better.
It’s worth pointing out that this special facility has been extended to Pakistan in the past (after the 1998 nuclear tests) and at the end of the deferred period, the entire amount was simply written off. It is not unreasonable to expect that it will be very different this time. This comes at a great time for the Pakistani economy which, like many of the other economies around the world, has been affected by rising oil prices. In particular, the foreign exchange outflows to fund imports were drastically increased. This deferrment will go a very long way in resolving that issue for the next several years. During this time, the government plans to invest heavily in infrastructure for power generation, local oil exploration and refining, to address longer term energy security. (more…)
China Telecom to invest a further $800M in Pakistan
China Telecom is now the world’s largest telco. It’s yet another indication of how influence and power are continuing their eastward journey… as Bob Dylan once poignantly said, “The times they are a changin’”. In order to supplement its domestic growth, China Telecom is looking at international markets to expand into. Their 2007 entry into Pakistan has been one of the most significant moves they’ve made in this direction. Last year, they struck a deal to buy-out Paktel, which has since been rebranded Zong, and launched a significant campaign to enhance their share of the mobile telephone market.
The Business Recorder reports today that Mr. Wang Gian Zhuo, the President of China Mobile has announced that his company’s plans in Pakistan will be augmented by a further $800 Million investment to develop infrastructure and lay the ground work for more advanced service provision. And as a demonstration of their commitment to Pakistan, China Telecom has also announced that they will be launching several initatives for socio-economic uplift, including the distribution of free text books to deserving children in the country. Great idea and something that will go a long way in building goodwill for China Telecom and its products! (more…)
Pakistan has highest Tele-density in South Asia, $9BN FDI for IT so far: Prime Minister
While this comes as no surprise, it is good to be reminded! The Prime Minister, while speaking to a delegation of the GSM Association explained that Pakistan has achieved a teledensity of 58%, which is the highest in South Asia. The infrastructure investments Pakistan has made in the telecom space, fiber, cellular and wireless broadband, are quite incredible.
The Prime Minister, Mr. Yusuf Raza Gilani, also quoted investment figures concerning the IT industry. So far, Pakistan has attracted $9 Billion dollars in foreign investment in the IT industry. In addition, the telecom sector attracted $3 Billion dollars last year. This figure is expected to rise as we have been reporting.
Warid Telecom to invest a further $1.5BN in Pakistan by end 2009
Warid Telecom’s cell phone service has been quite a success story. They’ve grown their subscriber base rapidly and are well poised to deliver other services to their customer base. A couple of the big infrastructure efforts they’ve been working on have been through their parent company, Wateen. They’re planning to build their own high-bandwidth Fiber network throughout the country and are also delivering WiMax services to consumers and businesses in Pakistan.
Their investment in Pakistan hasn’t stopped though, because Wateen and Warid see tremendous growth potential over the coming years. Their CEO, Marwan Zawaydeh, and Chief Commercial Officer, Thomas Yeo, recently announced that they would be investing a further $1.5BN in infrastructure development in Pakistan over the next 18 months. Some of this money will be used to double their cell towers to 5,000 sites by end of 2008. Good going Warid! Quotes from a news story and a link to the article after the break. (more…)
Rocketing KSE attracts $152M in foreign funds during February, 2008
The KSE has now beat its high three days running, and closed above 15,000 for the first time. Even at these levels, it remains one of Asia’s most attractive high-growth markets because of the comparatively conservative P/E multiples blue-chip companies on the bourse are trading at. This has not gone unnoticed by foreign portfolio fund managers. Foreign investment in the KSE is continuing to increase, as this quote from a News story indicates:
“According to the State Bank of Pakistan, foreign investors made new investments of $22,100,000 in Pakistani stock market on February 25, 2008″
More after the break. (more…)
