Record Cement Sales in Pakistan Point to Economic Rebound

[RiazHaq]

http://www.riazhaq.com/2015/02/record-cement-sales-raise-hopes-of.html

Domestic cement sales are up 9% year-over-year for the first 7 months of Pakistan's Fiscal 2014-15, according to media reports. Overall, cement industry reports a 6% annual increase with rising domestic demand offsetting falling exports due to weakness abroad.

Market capitalization of Pakistani cement companies has jumped 70% last year, about 3 times more than the KSE-100 market index which rose 27% in 2014. This is the third consecutive year that cement companies have outperformed the broader market. Investors in Pakistan's cement sector have seen 600% rise in the last three years.

It appears that construction sector is getting a boost from falling inflation and declining interest rates with a big drop in world oil prices.

​

Pakistan saw its domestic cement consumption double from about 11 million tons in 2003 to 22 million tons in 2008 on President Musharraf's watch. It remained essentially flat from 2009 through 2011 before rising to a new high of 24 million tons in 2012. With expected GDP annual growth to average 4.5-5.5 per cent over the next 3 years, local cement sales could rise by 9 per cent on average annually to reach 34 million tons per year by 2017 and exports to 8 million tons per year.

Cement sales and building activity indicators are an important sign of the strength or weakness of the broader economy, due to construction's important role in the economic sector. If individuals and businesses are willing to invest in new construction, it is a sign that the economy is doing well or poised to recover. If they aren't, the economy may be weak or headed for trouble. Construction is a very labor-intensive activity which creates many new jobs. Higher employment drives consumer spending which further stimulates the national economy.

In addition to rising demand for housing and new commercial real-estate, major infrastructure and energy projects related to the China-Pakistan Industrial Corridor are expected to significantly boost domestic cement consumption and create millions of new jobs over the next several years.


http://www.riazhaq.com/2015/02/record-cement-sales-raise-hopes-of.html

 

[KhanHaripur]

Afghanistan jaa raha hay kafi tadaad main ab jo Musalman Pakistan say beghar huay unhain kahin aur ja k ghar to bananna hay na rahny k liyeh.

 

[RiazHaq]

Afghanistan jaa raha hay kafi tadaad main ab jo Musalman Pakistan say beghar huay unhain kahin aur ja k ghar to bananna hay na rahny k liyeh.

Cement exports to Afghanistan are way down. Domestic demand is up 9% while overall demand is up 6% due to falling exports.

 

[RiazHaq]

To finance infrastructure projects connecting South Asia, Southeast Asia, Central Asia and Europe along an integrated land corridor


China has taken a firm step to implement its vision of the Silk Road Economic Belt — an initiative to integrate the economies of Asia and Europe along the Eurasian corridor — by putting into operation its $40 billion infrastructure fund for this purpose.


The fund, flagged in November last by Chinese President Xi Jinping, has started functioning on the lines of Private Equity (PE) venture. With China as the fulcrum, it is meant to finance development of roads, rail tracks, fibre optic highways, and much more, that would connect South Asia, Southeast Asia, Central Asia and Europe along an integrated land corridor.


Funds can also be allocated for the Maritime Silk Road (MSR), which envisions development of ports and facilities, mainly in the Indian Ocean. These ports will be connected to the hinterland by a string of land arteries, which will eventually hook up with the main Silk Road Economic Belt at specific junctions.


Xinhua quoted President Xi as saying during the November meeting with officials from Bangladesh, Cambodia, Laos, Mongolia, Myanmar, Pakistan and Tajikistan that the purpose of the fund is to “break the connectivity bottleneck” in Asia.


The Chinese President had offered investors from Asia and beyond to join the Silk Road fund for the development of specific projects.


The $40 billion fund was in addition to the decision to establish a $50 billion Asian Infrastructure Investment Bank, which is also meant to help finance construction in the region.


On Monday, the semi-official China Business News quoted Zhou Xiaochuan, governor of the People’s Bank of China (PBOC), as saying the $40 billion fund “has already started operations, with registration on December 29 and the first board meeting on January 6”.


China has poured part of its foreign exchange reserves in the fund, which include investors such as the China Investment Corp, the country's sovereign fund, and China Exim-Bank.


Analysts point out that as its economy slows down from its earlier blistering pace, China has developed large overcapacity in construction material, including cement and steel. China’s “One Road, One Belt” strategy, aimed at establishing new “growth engines” along the Eurasian corridor, could well absorb some of this surplus.


In an editorial in China Daily, Justin Yifu Lin, former chief economist of the World Bank, wrote: “The strategy is good for the stabilisation and development of the world economy and China, as it has a large overcapacity in construction materials.”


http://www.thehindu.com/news/intern...d-fund-becomes-operational/article6902549.ece

 

[RiazHaq]

APC rejects changes in Pak-China Economic Corridor (PCEC) route -


The All Parties Conference (APC) here on Tuesday rejected the proposed changes in the Pakistan-China economic corridor route from Khyber Pakhtunkhwa to Punjab and asked the Pakistan Muslim League-Nawaz (PML-N) led-federal government to rollback its decision in this regard. The APC was held under Awami National Party (ANP) in Islamabad. Leader of the opposition in the national assembly, Syed Khursheed Ahmed Shah Asfandyar Wali Khan, vice chairman Pakistan Tehreek-e-Insaf (PTI) Shah Mehmood Qureshi, Mehmood Khan Achakzai, Aftab Ahmed Khan Sherpao and other leaders participated in the conference. ANP chief Asfandyar Wali Khan has said that changes in the trade corridor will increase sense of deprivation among the people in Khyber Pakhtunkhwa, FATA and Balochistan. He said that it is not only trade route but many other development projects are also related with this. The ANP chief said that the corridor can play major role in curbing the menace of terrorism. He said that if the government is serious to strengthen Pakistan, they needed to strengthen provinces. He asked the government not to reverse the mistakes committed in the past. Asfandyar Wali said that following the terrorists brutal attack on Army Public School (APS) in Peshawar the whole nation united. He said that all the political parties supported Prime Minister Nawaz Sharif in war against terrorism. It is mentioning here that the proposed change in the route of Pakistan-China Economic Corridor drew stiff resistance from political parties despite its immense economic potential The 45 billion US dollars Pakistan-China Economic Corridor (PCEC) is believed to be the game changer for the region. It will connect Gwadar with Kashgar town in the autonomous Xinxiang region in China through highways, railroads and pipelines of gas and oil, boosting the economy in all the towns that would become part of this mega economic project. The PCEC is likely to serve as gateway for trade between China and the Middle East and Africa. The project is to cut a 12,000-kilometre route between Middle East and Chinese ports. The two countries, Pakistan and China, have already signed agreements for constructing an international airport at Gwadar, upgrading a section of 1,300-kilometre Karakorum Highway and laying a fibre-optic cable from the Chinese border to Rawalpindi. In November last year, Chinese government announced financing companies to build energy and infrastructure projects worth $45.6 billion under the PCEC. The project has hit controversy after major political parties in Khyber Pakhtunkhwa and Balochistan launched protests against the change in the original route, which is believed to deprive a major portion of Khyber Pakhtunkhwa, Balochistan and Fata of an opportunity of development, business and jobs. Major political parties in Khyber Pakhtunkhwa and Balochistan are still opposed to any change in the route of the Pakistan-China Economic Corridor. The opposition parties have expressed anger over change in the route in the Upper House by staging walkouts twice in a single session. The Khyber Pakhtunkhwa Assembly unanimously rejected any change in the route by the federal government. The Awami National Party has also written a letter to the Chinese envoy to Pakistan, seeking a meeting to discuss how the change in the route is to affect the two already backward provinces and Fata. -


See more at: http://www.khybernews.tv/newsDetails.php?cat=2&key=NzYzNDQ=#sthash.EzN4ii3l.dpuf

 

[P4kistani]

aj kal bori kinay di ay ?

 

[RiazHaq]

In the 'Best Hidden' Frontier Market, a Boom Signals a Pakistan Revival
Construction is leading the way in a big expansion

by Faseeh Mangi
June 30, 2015 — 12:00 PM PDT

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The Bahria Town Icon, right, under construction stands over the Sufi shrine of Abdullah Shah Ghazi in Karachi, on June 28, 2015. Photographer: Asim Hafeez/Bloomberg

The Sufi shrine that dates to the 8th century in Karachi’s posh Clifton neighborhood has served as the area’s defining landmark for decades. Not anymore.


Dwarfing the monument today is a gleaming 62-story highrise, coming up right next door. The building is one of at least half a dozen projects springing up in the locality as developers from Dubai’s Emaar Properties PJSC to local tycoons change the face of Pakistan’s financial hub and the skylines of many smaller towns.


The construction boom also marks the nation’s emergence as a frontier market after Prime Minister Nawaz Sharif averted a balance-of-payments crisis with help from the International Monetary Fund and resumed selling stakes in state companies. He is boosting infrastructure spending as the $232 billion economy expands at the fastest pace since 2008 amid the cheapest borrowing costs in 42 years.




“It is the best, undiscovered investment opportunity in emerging or frontier markets,” said Charlie Robertson, London-based chief economist at Renaissance Capital Ltd. “What’s changed is the delivery of reforms -- privatization, an improved fiscal picture and good relations with the IMF.”


Shrugging off sectarian violence, bombings, killings and kidnappings, the benchmark KSE100 stock index has advanced about 16 percent in the past 12 months, featuring among the world’s top 10 performers.


D.G. Khan Cement Co., controlled by billionaire Mian Muhammad Mansha, and Cherat Cement Co. have announced expansion plans, while steelmakers are selling shares.


Steel IPOs
Amreli Steels Ltd., the nation’s biggest maker of steel bars used in construction, isplanning a share sale to help double capacity. Mughal Iron & Steel Industries Ltd. completed an initial public offering in April.


Pakistan’s cement industry has rallied 57 percent in the past year, more than triple the gains by the benchmark, according to data compiled by Bloomberg. D.G. Khan Cement, the third-largest maker of the construction material, has jumped 62 percent and Maple Leaf Cement Factory Ltd. has surged 161 percent and Fauji Cement Co. Ltd. has gained 81 percent.


“The construction industry is seeing a boom, and there is still juice left in the cement rally,” said Mir Muhammad Ali, chief executive officer of UBL Fund Managers Ltd. that handles about 56 billion rupees ($550 million) in stocks and bonds in Karachi. “Overall economic improvement has also helped.”


Sharif, who took power in May 2013, boosted infrastructure spending by 27 percent to 1.5 trillion rupees for the year starting Wednesday, July 1.


IMF Program
Pakistan is making “significant progress” in meeting targets under its $6.6 billion loan program, the International Monetary Fund said in May. The lender predicted a 4.5 percent growth in the economy in the year starting July 1, following a 4.1 percent expansion last fiscal year.


Easing prices are also set to buoy consumer spending. Inflation in South Asia’s second-largest economy slowed each month this year through April as transport and food prices fell, prompting the central bank to cut the benchmark interest rate in May to the lowest level in 42 years.


Moody’s Investors Service upgraded Pakistan’s sovereign credit ratings for the first time since 2008 in June but said stalling of the ongoing IMF program or an unstable political environment would be credit negative.


China
Violence, mostly from Taliban-linked insurgents who want to impose their version of Islamic law, has claimed more than 60,000 lives since 2001. Sharif survived a scare last August when opposition parties demanded his resignation over accusations he rigged the elections in 2013. He denied the allegation but agreed to a probe by a tribunal.


Standing by Pakistan is the nation’s long-time strategic ally. In April, Asia’s biggest economy, China, signed deals for $28 billion of investments in Pakistan as part of a planned $45 billion economic corridor that includes power plants and dams.


The development in cities and smaller towns is trickling down and is good news for smaller contractors as well .


“Business has been very good, and there’s no doubt my work has tripled in five years,” said Mohammed Hassan Bakshi, 43, a builder in Karachi. “There’s huge demand from the middle class for affordable housing.”


Builders in Pakistan are seeking technology from China to help cut down construction and project execution times to as little as six months from as long as five years, he said.


The nation’s construction sector grew by 11.3 percent in the year through June 2014, almost double the 5.7 percent target, according to central bank data. Pakistan is a reform story like neighboring India’s, but only better, said Renaissance’s Robertson.


“All of this is a big change on 2013,” he said. “Credit rating agencies are beginning to recognize this.”




http://www.bloomberg.com/news/artic...frontier-market-boom-signals-pakistan-revival