Expatriate Pakistanis: PM announces $1 billion bond issue
In surprise visit to KSE, Sharif says export refinance rate to be reduced from 7.5% to 6%.
During a visit to the Karachi Stock Exchange (KSE), Sharif told KSE officials and prominent brokers that the funds generated by the sale of bonds will be used to expand the housing sector in the country. PHOTO: PID
KARACHI:
Prime Minister Nawaz Sharif said on Friday that the government is going to issue bonds worth $1 billion in the near future.
During a visit to the Karachi Stock Exchange (KSE), Sharif told KSE officials and prominent brokers that the government intends to raise $1 billion worth of foreign exchange from expatriate Pakistanis.
Finance Minister Ishaq Dar was scheduled to visit the bourse, but Sharif also made a surprise appearance on the occasion.
According to sources that were present during the meeting, Sharif said the funds generated by the sale of bonds will be used to expand the housing sector in the country.
The prime minister seems to be enamoured of long-term debt instruments that raise money from international investors. The government sold sukuk, or Islamic bonds, in the global market last November.
The government had originally planned to sell sukuk worth $500 million, but it doubled the size of the offering in view of the positive response from international investors. Against the oversubscription of $2.3 billion, the government ended up raising $1 billion from the sale of the Islamic bonds.
Earlier on, the government also issued Eurobonds that successfully raised $2 billion. Once again, the funds raised through the long-term debt instrument far surpassed the government’s original target of $500 million.
It was mainly due to the issuance of sukuk and Eurobonds, along with receipt of successive loan tranches from the International Monetary Fund (IMF), that the central bank’s liquid foreign exchange reserves have increased to $10.2 billion.
Sharif vowed to bring down the corporate income tax rate by 1% per year for the rest of his term as prime minister. The corporate income tax rate for companies other than banking institutions currently stands at 33%.
Sharif also said National Tax Numbers (NTNs) will be replaced with Computerised National Identity Cards (CNICs) following July 1, 2016. It will improve tax collection and reduce processing costs, he said.
With regards to the incentives extended to exporters, the prime minister announced that the rate of refinance for banks under the export finance scheme will be reduced from 7.5% to 6% from February 1.
After disbursing the loan to an exporter, commercial banks typically seek the State Bank’s financing facility to get reimbursement of the same loan. Cheaper refinancing is expected to result in an improved supply of liquidity for exporters.
Reiterating his commitment towards ending the energy shortages in the country, Sharif said the gap between demand and supply of electricity will be brought down to zero before the end of his term as prime minister.
Published in The Express Tribune, January 31st, 2015.
Prime Minister Nawaz Sharif said on Friday that the government is going to issue bonds worth $1 billion in the near future.
During a visit to the Karachi Stock Exchange (KSE), Sharif told KSE officials and prominent brokers that the government intends to raise $1 billion worth of foreign exchange from expatriate Pakistanis.
Finance Minister Ishaq Dar was scheduled to visit the bourse, but Sharif also made a surprise appearance on the occasion.
According to sources that were present during the meeting, Sharif said the funds generated by the sale of bonds will be used to expand the housing sector in the country.
The prime minister seems to be enamoured of long-term debt instruments that raise money from international investors. The government sold sukuk, or Islamic bonds, in the global market last November.
The government had originally planned to sell sukuk worth $500 million, but it doubled the size of the offering in view of the positive response from international investors. Against the oversubscription of $2.3 billion, the government ended up raising $1 billion from the sale of the Islamic bonds.
Earlier on, the government also issued Eurobonds that successfully raised $2 billion. Once again, the funds raised through the long-term debt instrument far surpassed the government’s original target of $500 million.
It was mainly due to the issuance of sukuk and Eurobonds, along with receipt of successive loan tranches from the International Monetary Fund (IMF), that the central bank’s liquid foreign exchange reserves have increased to $10.2 billion.
Sharif vowed to bring down the corporate income tax rate by 1% per year for the rest of his term as prime minister. The corporate income tax rate for companies other than banking institutions currently stands at 33%.
Sharif also said National Tax Numbers (NTNs) will be replaced with Computerised National Identity Cards (CNICs) following July 1, 2016. It will improve tax collection and reduce processing costs, he said.
With regards to the incentives extended to exporters, the prime minister announced that the rate of refinance for banks under the export finance scheme will be reduced from 7.5% to 6% from February 1.
After disbursing the loan to an exporter, commercial banks typically seek the State Bank’s financing facility to get reimbursement of the same loan. Cheaper refinancing is expected to result in an improved supply of liquidity for exporters.
Reiterating his commitment towards ending the energy shortages in the country, Sharif said the gap between demand and supply of electricity will be brought down to zero before the end of his term as prime minister.
Published in The Express Tribune, January 31st, 2015.