seCP chief in the line of fire!

01

bUsINess

BFriday, 12 April, 2013

Belgium should facilitate signing of

FTA between Pakistan and EU. –

KCCI President Haroon Agar

ISLAMABAD

AGENCIES

PAKISTAN ranked a low105 out of 144 countries inThe World EconomicForum’s Global Informa-tion Technology Report2013 in terms of overall

networked readiness. Finland ranked num-ber one, while Burundi ranked lowest at 144.

The report accesses how countries har-ness information and communication tech-nologies (ICT) to deliver competitiveness andwell-being. Published under the theme of“Growth and Jobs in a HyperconnectedWorld”, the report suggests that national poli-cies in some developing economies are failingto translate ICT investment into tangible ben-efits in terms of competitiveness, develop-ment and employment. This is in addition tothe profound digital divide that already existsbetween advanced and developing economiesin access to digital infrastructure and content.South ASiA overAll rAnking

india 68Sri lanka 69iran 101Pakistan 105Bangladesh 114nepal 126

Pakistan continues to lag behind in therankings.

Unable to achieve a sustained rapideconomic growth may put Pakistan’s ICT-competitiveness in jeopardy unless the rightinvestments are made in ICT, skills and in-novation.

“As other countries are improving rap-idly, Pakistan has shown little change. Thisis a matter of concern. Pakistan is 37 ranksbehind India,” said CEO Mishal PakistanAmir Jahangir.

“The big challenge for the next govern-ment in Pakistan would be to put more em-phasis on ICT environment and regulatoryframework. The role of ICT for a sustainedeconomic growth and job creation is crucialto improve Pakistan’s competitiveness. ICThas revolutionised the way businesses aredone and the country has not being able tocapitalise on this,” Jahangir added.

Broadband internet tariffSome of the areas where Pakistan lost

its ICT competitiveness include govern-ment’s procurement of advance technolo-gies, which ranked 109 this year ascompared to 91 in 2012.

Although Pakistan has improved thefixed broadband internet tariff substantiallyby making Pakistan the 68th most compet-

itive broadband provider in the world, in-dividuals using internet, which depicts af-fordability of internet for citizens isshrinking.

Pakistan lost 22 points in 2013 andranks at 120 on individuals using internet.The report highlights that the gains inbroadband affordability are being achievedby cannibalising the individual internetusers.

Mobile technologyThe importance of ICTs to govern-

ment’s vision has deteriorated from 92 to117 in 2012 and 2013 respectively, makingICT one of the least priority areas for thegovernment of Pakistan.

Pakistan achieved significant gains inthe last decade, when it embraced the mo-bile technologies and led the region by pro-viding human resources capital andtechnical knowhow to the global pool ofmobile communication providers.

However, this gain has greatly dimin-ished due to lack of advancements and in-consistency in decision-making to adoptnew technologies at the right time.

Economic and social impactOn the economic impact pillar, Pak-

istan failed to show progress on creatingimpact of ICTs on new organizational mod-

els by losing 10 points (91) – keeping busi-nesses in mostly traditional areas and con-necting Pakistan with the global knowledgeeconomies.

Similarly, government’s failure to cre-ate social impact through ICT also show-cases its poor understanding of innovationecosystem and value creation for the citi-zens in the digital age.

The government failed to create valuethrough ICT use and improving efficiency,where Pakistan lost an alarming 16 points(121 among 144 countries).

Not being able to improve any regula-tions on venture capital availability has alsocreated a bottleneck for an innovation econ-omy in the country.

This signifies Pakistan’s lack of corre-lation between innovation and competive-ness with finance, thus further isolatingPakistan from moving towards a knowl-edge-based economy.

Pakistan also lost 15 points on the E-participation index, where government en-gages citizens through online services andgrievance mechanism, thus resulting instronger red-tapism slower economicprogress.

ImprovementsSome of the areas where Pakistan has

shown improvements are on the businessand innovation environment pillar, wherethe business sector has ensured the avail-ability of latest technologies for ICT com-petitiveness by improving 10 points andsecuring 83 rank among 144 countries.

Pakistan ranks low 105 on WEF’sInformation Technology report

AMIR JAHANGIRCEO Mishal Pakistan

As other countries are

improving rapidly,

Pakistan has shown

little change. This is a

matter of concern.

Pakistan is 37 ranks

behind India.

ISLAMABAD

AGENCIES

Securities & Exchange Commissionof Pakistan (SECP) ChairmanMuhammad Ali was a partner in aconstruction business with brokershe regulated till mid-2011, serving aschief of one of the top regulators ofthe country, according to media re-ports.

Ali, appointed SECP chairmanon December 24, 2010, was a 15percent shareholder in RI Enter-prises, which had four other partners— all stock market brokers, accord-ing to Federal Board of Revenue(FBR) documents for the financialyear ending on June 2011.

The partnership between stockmarket brokers and a regulator raiseseyebrows because this arrangementremains open to nepotism and abuseof authority. One of the partners, Da-

wood Jan Mohammad, a leadingname at the Karachi Stock Ex-change, has a number of cases pend-ing against him relating to massivetax evasion which conveniently gonowhere near prosecution with thecurrent SECP administration, marketsources said. The FBR documentsstated that Ali had opening capital ofmore than Rs 52 million in RI Enter-prises. A pre-tax profit of around Rs5.5 million was earmarked in hisname in fiscal year 2010-11, takinghis total drawing capital right to a lit-tle over Rs 56 million. The FBR ac-cused the company of evading Rs2.5 million worth of taxes in the fis-cal year 2010-11.

The SECP chairman denied hewas a partner in RI Enterprises afterassuming office and said he had soldhis shares in early 2006. He claimedhe had all documents to prove he hadsold his share in the business in

2006. He further said the confusionon the FBR documents is becausehis former partners did not removehis name from the business.

In Pakistan it remains a commonpractice that the relevant authorities— the registrar office in this case —are often not informed about thechange in partners in time, headded. However, analystsfound it surprising thatan expert of Ali’s cal-iber failed toproperly close hisdeal after sellinghis stakes in abusiness. Anexpert went on tosay that Aliwould have beenwell aware that hisfinancial issues wouldremain secure if he re-mained a partner and that

was why he did not get his name re-moved. “He would have thought thatif this was pointed out he could sayhis partners had not removed hisname,” he added.

They were of the opinion that aperson of Ali’s stature, who has beenin the stock market business for a

long time, and has been at keypositions leading big bro-

kerage houses such asElixir Securities

and WI CarrSecurities can-not be ex-pected tomake such amistake.

M a n s o o rAhmad Janjua,

an official of anIslamabad-based

brokerage house, wholodged complaints

against the SECP chairman at theFederal Tax Ombudsman, InlandRevenue Karachi and FBR, ques-tioned why Ali did not take actionagainst his former partners for notremoving his name from the docu-ments of the business.

Janjua further said that in hisdeclaration to tax authorities for FY2010-11 and FY 2011-12, Muham-mad Ali cited seven and six busi-nesses respectively in which he hadstakes, but there was no mention ofRI Enterprise in them.

SECP Securities Market Divi-sion Commissioner Imtiaz Haidersaid Januja worked as the companysecretary of a brokerage house,Ahmed Nadeem Securities, whichremains under scrutiny for default-ing on payments to its investors.

The brokerage house, he added,had applied for voluntary windingup of operations after defaulting on

payments for Rs 80 to Rs 90 million.He questioned the motives behindwhat he called was a propagandaagainst the SECP chairman. The Is-lamabad Stock Exchange, he furthersaid, had frozen the membership ofits owner and investigations wereunderway.

The SECP chairman said an or-ganised campaign had been lodgedby some powerful brokers to malignhim because decisive action wasbeing taken against them for violat-ing various rules and regulations andmanipulating the market. However,his appointment has also been chal-lenged in the Supreme Court, a judg-ment on which has been reserved.

It is speculated that powerfulstakeholders in the Karachi businesscommunity, that are close to Pak-istan People’s Party (PPP), are lob-bying for Ali be to the country’sfinance minister.

UNITED NATIONS

APP

Foreign investors are increasingly resorting to investor-statearbitration to settle investment disputes, with a recordnumber of cases filed last year, according to a newreport released today by the United NationsConference on Trade and Development(UNCTAD). The report, ‘Recent Devel-opments in Investor State Dispute Set-tlement (ISDS), showed that 62 newcases were filed in 2012, of which 68percent of respondents were fromdeveloping or transition economies.Recent developments have ampli-fied a number of cross-cutting chal-lenges that are facing the ISDSmechanism, which gives credence tocalls for reform of the investment arbi-tration system, said James Zhan, Directorof UNCTAD’s Division on Investment andEnterprise, which published the report.

Foreign investors challenged a broad range ofgovernment measures, UNCTAD reported, includingrevocations of licences, breaches of investment contracts, ir-regularities in public tenders, changes to domestic regulatoryframeworks, withdrawal of previously granted subsidies, di-rect expropriations of investments and imposition of taxes.

Nine decisions in 2012 awarded damages, including theWorld Bank’s International Centre for the Settlement of In-vestment Disputes (ICSID), which ordered Ecuador to pay$1.77 billion to Occidental Petroleum Corp as compensation

for taking over its assets in 2006. The monetary award was the highest in thehistory of Investor-State Dispute Settlement

(ISDS). In addition, for the first time intreaty-based ISDS proceedings, an arbi-

tral tribunal affirmed its jurisdictionover a counterclaim lodged by a re-spondent State against the investor.By the end of 2012, the total numberof known cases reached 518, and thetotal number of countries that haveresponded to one or more ISDSclaims increased to 95, according to

UNCTAD. The overall number ofconcluded cases reached 244, out of

which approximately 42 per cent weredecided in favour of the State and 31 per

cent in favour of the investor. Approximately 27 per cent of the cases were

settled. The ISDS mechanism is already a source of con-sidered reflection in numerous bilateral and regional IIA ne-gotiations. However, a multilateral dialogue on ISDS couldprove more effective in bringing about a harmonized ap-proach to reform, Zhan said.

Int’l investment disputes hitrecord in 2012: UN report

PSO to set up oilrefinery in KhyberPakhtunkhwa

PESHAWAR

STAFF REPORT

Pakistan State Oil (PSO) has signed aMemorandum of Understanding (MoU)with the Government of KhyberPakhtunkhwa (GoKP) for the establish-ment of a state-of-the-art oil refinery inthe province. The MoU to initiate this landmark projectwas signed by Additional Secretary, Min-istry of Petroleum & Natural Resources,Naeem Malik; CEO & MD – PSO,Naeem Yahya Mir and Secretary Energyand Power – GoKP, Zaffar Iqbal.

Preparations for country’s largest womenexpo in full swing

ISLAMABAD

ONLINE

Preparations are underway to hold a two-day Islamabad Expo 2013, the largestwomen’s exhibition in Pakistan, under theauspicious of Islamabad Women Chamberof Chamber of Commerce and Industry(IWCCI). Samina Fazil, founder presidentIWCCI and organizer of the expo said thatthe event titled, “Empowering WomenThrough Trade and Industry” will be heldon April 13 and 14 which will be inaugu-rated by Shafqat Sultana, President FirstWomen Bank Limited. Speaking to womenentrepreneurs, she informed that apart fromworkshops and seminars, successful busi-nesswomen will share their stories whiletwelve universities and fifteen ambassadorswill also participate in the expo.

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bUsINessFriday, 12 April, 2013

ISLAMABAD: The new GM Islamabad Marriott,

Jan Verduyn, Chief Operating Officer Hashoo

Group Hotels Division Clive Webster and the

President Hospitality, Industrial & Real Estate

Division Hashoo Group Mohammad Akhtar

Bawany receive the dignitaries at a reception

hosted by him at the residence of the Chairman

Hashoo Group Sadruddin Hashwani. PR

ISLAMABAD: Amir Rao, country manager

Microsoft Pakistan and Sajjad Abbas, reginal

sales manager ME Fujitsu Technology

Solutions along with other officials. PR

ISLAMABAD: NUST Rector Engr Muhammad

Asghar presents a souvenir to Federal Minister

Science and Technology Dr Sania Nishtar. PR

International investors keen to invest in OGDCL sharesISLAMABAD: The Bank of America Merrill Lynch

arranged the Asean Stars Conference in Singapore

which was attended by various Asset Management

Companies and Fund Managers of the world,

OGDCL representatives attended the conference

and highlighted financial state of OGDCL which

attracted the Fund Managers to invest in OGDCL in

Pakistan. There was a reasonsable demand and

appetite for OGDCL share in the international

market. The investors raised the issue germane to

non availability of OGDCL share in the market and

indicated their interest in OGDCL share and

expected that Government of Pakistan will decide

to make divestment a prompt, positive and

encouraging response is expected from the internal

market.

The OGDCL team interacted with foreign investors

which includes Morgan Stanley Investment

Management Inc, Putnam Investments, LLC, Walter

Capital Partners SA, Nomura Asset Management

Co. Ltd, Dws Investments, Sloane Robinson LLP,

Prince Street Capital Management Inc, HSBC

Holding Plc, TCW Group, Aberdeen Asset Managers

Ltd, NTUC Income Insurance Co-Operative Limited,

Natixis Asset Management (International), Rovida

Asset Management (Singapore) Ltd and Somerset

Capital Management LLP. PR

1st ever branchlessbanking mobile app forOmni account holdersKARACHI: United Bank Limited’s Branchless

Banking Division, Omni has introduced another

unique feature, a Mobile App, to enhance the

customer’s experience with the service. This is a

first ever in the Branchless Banking industry, with

UBL Omni the only Bank to offer such a service.

The penetration of mobile phones is at an all time

high and the growth of the Smartphone market has

led to widespread use of mobile apps for everything

in a person’s daily life. The Omni mobile App aims

to tap into this growing market by giving Omni

customers a secure and convenient channel for

accessing their account and conducting

transactions. The Omni Mobile App is available for

Android and Java enabled handsets and can easily

be downloaded from the UBL Omni website. PR

Attock Petroleum Limited(APL) celebrates 400retail outlets landmark

ISLAMABAD: Attock Petroleum Limited (APL) while

on the way of augmenting its Retail Network hit yet

another milestone when it commissioned its 400th

petrol pump located in DHA Phase 2, Islamabad on

April 9, 2013. The site’s inauguration was honored

by respectable Group Regional Chief Executive of

Attock Group of Companies, Mr. Shuaib A. Malik.

APL vehemently believes that its direct customers

and end-users both play a pre-dominant role in

successful growing of its Retail Network. Hence,

Company’s policy on the expansion of Retail

Network chiefly involves characteristics that pertain

to first-rate additions in context of apt locations

and highly equipped facilities backed up with state-

of-the-art technology for rendering best services.

The newly inaugurated pump is one such example

that corroborates APL’s relentless efforts of

supplementing the Retail Network via keeping in

view its motto of providing excellence in product(s)

and service(s) both.

Expansion of Retail Network is juxtaposed to the

building of new and enhancement of existing

storage facilities to cater to the ever rising energy

demand. With the well devised strategies, APL

foresees a growth in energy demand in the country

which lays foundation of its decision for further

increasing its storage capacities.

On this occasion, Mr. Shuaib A. Malik, Group

Regional Chief Executive of Attock Group of

Companies stated that, “Such achievements help in

bolstering confidence of every entity associated

with the Company. With our employees, business

partners and customers progressive approach we

shall keep on heading on the road of success and

win a sustainable competitive edge” PR

EPZA to increase investment KARACHI: A meeting was called in EPZA to take

immediate steps to increase investment in Export

Processing Zone Authority EPZA. During the

meeting a committee was formed by Chairman

EPZA, Mr. Saadat S. Cheema with a mandate to

initiate steps to open and revive the sick units

which stopped functioning due to any reasons n

the past. This Committee will soon submit its

findings and recommendations to Chairman

EPZA.

It was mutually decided in the meeting that in

order to revive these sick units certain relaxations

will be given to the investors so that operations

could start on ASAP basis in these units. PR

CORPORATE CORNER

02

B

Pakistan to get GSP plus status by

year end. – EU envoy to Pakistan

Lars-Gunnar Wigemark

Major Gainers

COMPANY OPEN HIGH LOW CLOSE CHANGE TURNOVERBata (Pak) XD 1690.00 1774.50 1680.00 1773.00 83.00 3,900Wyeth Pak ltd XD 1137.70 1194.58 1194.58 1194.58 56.88 1,150sanofi-aventis Pak 414.75 435.48 434.90 435.48 20.73 1,200Fazal textile 229.17 240.62 240.62 240.62 11.45 600Murree Brewery 186.54 195.86 195.00 195.86 9.32 13,600

Major Losersrafhan Maize 4300.00 4085.00 4085.00 4085.00 -215.00 20Unilever Food XD 5058.00 5310.90 5000.00 5000.00 -58.00 740nestle Pak. sPOt 6100.00 6100.00 6050.00 6050.00 -50.00 40Philip Morris Pak. 356.49 365.99 341.00 341.45 -15.04 92,100sunrays textile 208.30 199.00 198.00 198.00 -10.30 1,500

Volume Leaders

al-abbas Cement 6.03 6.48 6.03 6.30 0.27 12,789,500Engro Corporation 141.15 144.27 142.26 142.89 1.74 9,083,800Engro Polymer 12.17 12.70 12.19 12.26 0.09 7,766,000Maple leaf Cement 19.23 19.45 18.73 18.85 -0.38 7,248,000Jah.sidd. Co.XD 12.31 12.79 12.38 12.43 0.12 6,411,000

Interbank RatesUsD Pkr 98.2510gBP Pkr 151.0117JPY Pkr 0.9864EUrO Pkr 128.5909

ForexBUY SELL

Us Dollar 98.90 99.15 Euro 128.17 128.31 great Britain Pound 150.15 150.29 Japanese Yen 0.9746 0.9823 Canadian Dollar 96.08 97.53 hong kong Dollar 12.42 12.63 UaE Dirham 26.62 26.80 saudi riyal 26.12 26.30

NEW YORK

AGENCIES

gLOBAL growth is likely to re-main tepid this year and centralbanks should keep their easymonetary policies in place, thehead of the International Mone-

tary Fund has said. “Thanks to the actions of pol-icymakers, the economic world no longer looksquite as dangerous as it did six months ago,” IMFManaging Director Christine Lagarde told theEconomic Club of New York.

But while there were signs that financial condi-tions are improving, Lagarde said those changes arenot yet translating into improvements in the realeconomy. “In present circumstances, it makes sensefor monetary policy to do the heavy lifting in thisrecovery by remaining accommodative,” Lagardesaid ahead of meetings of global finance chiefs inWashington next week. “We know that inflation ex-pectations are well anchored today, giving centralbanks greater leeway to support growth,” she added.

She said a three-speed recovery is underway,led by fast-growing emerging economies, followedby countries such the United States that are on themend, and with the euro zone and Japan trailing.

In January, the IMF trimmed its 2013 forecastfor global growth to 3.5 percent from 3.6 percent,and projected a 4.1 percent expansion in 2014. Itsaid the world economy grew 3.2 percent in 2012.

Lagarde said the exceptionally loose monetarypolicies of central banks in advanced economies isa concern for emerging economies, which fear asudden reversal of the large capital flows that haveflooded their economies in recent years as investorshave sought higher yields. “Right now, these risksappear under control,” Lagarde said, but she urgedemerging economies to boost their defenses to dealwith the possible repercussions should centralbanks start to exit from quantitative easing.

The IMF chief welcomed the unprecedentedburst of monetary stimulus announced by the Bankof Japan last week to revive the country’s econ-omy. She urged Japan to deliver a credible fiscalplan to lower its public debt, “which looks increas-ingly unsustainable”.

“Japan needs a clear and credible planto lower public debt over the mediumterm,” Lagarde said. “It needs compre-

hensive structural reforms to shift the economyinto higher gear.” Lagarde said the ‘fiscal cliff’ inthe United States had been avoided, but that it isvital now for the Obama administration to put inplace credible, medium-term plans to cut debt.

In Europe, Lagarde said monetary policy is“spinning its wheels” with low interest rates un-

able to translate intoaffordable credit for

those who need itbecause of unfin-

ished repairs to thebanking sec-

tor.

IMF chief says easy monetarypolicy should stay for now

CHRISTINE LAGARDEiMF Managing DirECtOr

In present circumstances, it

makes sense for monetary

policy to do the heavy

lifting in this recovery by

remaining accommodative.

Fish exports up by 2.48%iSlAMABAD: Exports of fish and fishpreparations witnessed increase of 2.48 per-cent during the first eight months of thecurrent fiscal year as compared to the corre-sponding period of last year.Overall exports of fish and fish preparationswere recorded at $199.949 million duringJuly-February (2012-13) against the exportsof $195.119 million during July-February(2011-12), according to data of PakistanBureau of Statistics (PBS).In terms of quantity, the seafood exports ex-panded by 12 percent during the periodunder review, the data revealed.As much as 87,376 metric tons of seafoodwas exported during the first eight monthsof the current year against the exports of78,029 metric tons during the correspon-ding period of last year. Meanwhile,seafood exports during February 2013 de-creased by 5.89 percent and 15.46 percentwhen compared to the exports of February2012 and January 2013 respectively.The exports of fish and fish preparations inFebruary 2013 were recorded at $19.731million against the exports of $20.965 mil-lion in February 2012 and $23.240 millionin January 2013. In terms of quantity, theseafood exports in February 2013 decreasedby 10.63 percent and 15.79 percent whencompared to the exports of February 2012and January 2013 respectively.The fish exports were recorded at 8,591metric tons in February 2013 against the ex-ports of 9,613 metric tons in February 2012and 19,202 metric tons in January 2013.The overall food exports during July-Febru-ary (2012-13) witnessed increase of 9.22percent against the same period of last year.The food exports were recorded at $2.962billion against the exports of $2.712 billion.It is pertinent to mention here that the coun-try’s trade deficit decreased by 10.06 percent during the first eight months of thecurrent fiscal year as exports expanded by 5per cent and imports witnessed negativegrowth of 2.41 per cent. The overall exportsfrom the country increased from $15.128billion in July-February to US$15.884 bil-lion during July-February (2012-13), ac-cording to the PBS data.On the other hand, the imports decreasedfrom $29.788 billion last year to $29.069billion during the current fiscal year, show-ing negative growth of 2.41 per cent, thedata revealed. APP

Forex reserves fallbelow $12 billionkArAChi: Pakistan’s overall liquid foreign exchange reservescontinued their declining trend and fell below the $12 billion mark to$11.756 billion in a week from $12.202 billion last week, State Bankof Pakistan (SBP) reported on Thursday. In a statement, the centralbank said that reserves held by the State Bank stood at $6.697 billioncompared with $7.128 billion a week earlier. The reserves held bycommercial banks stood at $5.061 billion in the week ending April 5,2013 compared with $5.074 billion a week earlier. STAFF REPORT

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