Issue 21

Budget Study Centre Issue 21
August 08, 2018


Fortnightly Budget News Alerts


Pakistan defends its economic partnership with China

The News (Aug 08, 2018)

Islamabad – Pakistan Wednesday defended its economic partnership with China, amid fears that the terms of opaque multi-billion dollar investments by Beijing could be exacerbating Islamabad’s economic woes as it considers a fresh IMF bailout. "We have noted recent media reports questioning the viability of China Pakistan Economic Corridor (CPEC), claiming that it would create an unbearable debt burden for Pakistan,".…Read More


Brazil July inflation slows as impact of truckers’ strike fades

The Business Recorder (Aug 08, 2018)

BRASILIA: Inflation in Brazil slowed for the first time in two months in July as the impact of a May nationwide truckers’ strike dimmed, reinforcing the view that a recent price spike would not last long. Consumer prices tracked by the benchmark IPCA index rose 4.48 percent in the 12 months through July, government statistics agency IBGE said on Wednesday, slightly above the median 4.40 percent forecast of economists in a Reuters poll. That is a bit ……Read More


Pakistan to decide whether to seek IMF bailout ‘by September’

The Daily Times (Aug 08, 2018)

Pakistan must decide by the end of September if it will go to the IMF to bail out its economy, which is facing a balance-of-payments crisis, the likely new finance minister Asad Umar said Tuesday. “By the end of September, we should make our decision,” the Pakistan Tehreek-e-Insaf (PTI) leader said. Umar, who is widely tipped to become the next finance minister, reiterated his stance that Pakistan was examining other options as well as the.…Read More


Turkey under pressure to raise interest rates as economic crises looms

The Guardian (Aug 07, 2018)

Turkey is facing mounting pressure to announce an emergency rise in interest rates as rampant inflation, a plunging currency and American sanctions pushes one of the world’s key emerging market countries to the brink of crisis. Analysts said Turkey’s central bank would have no choice but to increase borrowing costs aggressively in the coming days to stem the fall in the lira, which is down by almost a third against the US dollar in the …Read More


Yuan weakens 3.4% in July

The China Daily (Aug 04, 2018)

BEIJING – China’s yuan weakened more than 3 percent against a basket of currencies in July, according to a China Foreign Exchange Trade System (CFETS) index. The CFETS RMB Index, which measures the yuan’s strength relative to a basket of currencies, came in at 92.41 at the end of July, a 3.4 percent decline from a month ago, CFETS said. The index compares the yuan to the value of 24 currencies, including the US dollar, euro and Japanese …Read More


Budget 2018-19 is a ‘farce’ says finance minister

The Daily Times (Aug 03, 2018)

Islamabad: Interim Finance Minister Shamshad Akhtar on Thursday termed the Budget 201819 presented by the former Pakistan Muslim League-Nawaz government “unrealistic”. Speaking to media, Akhtar said that facts and figures in the budget were a matter of “concern”. She also commented on the prevalent economic conditions, saying that work on the International Monetary Fund (IMF) project was underway and the incoming government……Read More


Sri Lanka secures $1 billion Chinese loan

The News (Aug 03, 2018)

COLOMBO: Sri Lanka´s central bank on Friday announced it had secured a $1 billion Chinese loan as the island, a key link in Beijing´s ambitious Belt and Road initiative, develops closer relations with Asia´s largest economy. Central bank Governor Indrajit Coomaraswamy said that first half of the loan will be released later this month and the balance will be received in October. "During consultations (with the Chinese over the loan) it was clear that they ……Read More


Bank of England raises interest rates to 0.75%

The Guardian (Aug 02, 2018)

The Bank of England has raised interest rates above the emergency level introduced after the financial crisis despite mounting fears about the economic impact of Britain crashing out of the EU without a deal. Citing concern that the lowest unemployment rate since the mid-1970s risked re-igniting wage pressure, Threadneedle Street raised interest rates to 0.75% from 0.5% – the level they were dropped to in March 2009 as the economy lurched ……Read More


Inflation touches 45-month high at 5.8%

The Business Recorder (Aug 02, 2018)

ISLAMABAD: Inflation has touched a high of three years and nine months at 5.8% in July with the Pakistan Bureau of Statistics (PBS) remaining unable to introduce a new more representative methodology of prices due to lack of administrative approvals. Measured by the Consumer Price Index, the average rate of increase in prices of 40 dozen items stood at 5.83% in July, reported the national data collecting agency on Wednesday. It is the highest….…Read More

Circular debt has soared to Rs 566bn, senate body told

The Daily Times (Aug 02, 2018)

ISLAMABAD: A legislative body of the Upper House of parliament was informed on Wednesday that circular debt of the country had soared to Rs 566 billion. Technical and distribution losses, less recovery, nonpayment of subsidies and K-Electric payment were few reasons for accumulation of the circular debt, the Senate Special Committee on Circular Debt, which meet under the chairmanship of Senator Shibli Faraz, was told. Shibli Faraz said that. Read More

Foreign exchange: In a major relief, SBP’s reserves surge 15% to $10.35b

The Express Tribune (Aug 02, 2018)

KARACHI: In an interesting turn of events, the foreign exchange reserves held by the central bank have increased by a massive 14.86% on a weekly basis, according to data released on Thursday. The development came after China announced that it would immediately give a $2-billion loan to Pakistan, a move meant to arrest the slide in official foreign currency reserves and provide much-needed breathing space to the new government. Read More


US opposes IMF bailout for Pakistan

The Express Tribune (Aug 01, 2018)

ISLAMABAD: A day after US Secretary of State Mike Pompeo warned against any International Monetary Fund (IMF) bailout that helps China, Pakistan has vowed that ‘third parties’ cannot weaken its resolve as it undertakes its biggest infrastructure and energy development plan with the help of Beijing. The $60 billion China-Pakistan Economic Corridor (CPEC), one of Beijing’s undertakings in its aggressive Belt and Road Initiative (BRI), has seen China extend ……Read More


India’s April-June fiscal deficit at 68.7pc of FY target

The Business Recorder (July 31, 2018)

NEW DELHI: India reported on Tuesday a fiscal deficit of 4.29 trillion rupees ($62.57 billion) for April-June, or 68.7 percent of the budgeted target for the current fiscal year compared with 80.8 percent a year ago. Net tax receipts in the first quarter of 2018/19 fiscal year that ends in March 2019 were 2.37 trillion rupees, government data showed. India expects to trim the deficit to 3.3 percent of GDP this fiscal year, after meeting an upwardly revised fiscal deficit……Read More


Dist council approves Rs 1.5bn budget

The DAWN (July 31, 2018)

OKARA: The district council in its annual budget session for 2018-19 approved annual estimated budget worth Rs1.5 billion, including expected income of Rs800.34 million as well as previous year’s balance of Rs250 million. These estimates also comprise provincial grant worth Rs480.8 million under Provincial Finance Commission (PFC) Award and local income of Rs272.5 million. The annual expected expenditures is Rs1.3 billion, including ……Read More


Deficit reaches €142m in first six m

The Times of Malta (July 27, 2018)

The deficit reached €141.9 million in the first six months of the year, with the government spending considerably more than the additional revenue it received. In June 2017, the deficit was €92 million. Revenue went up by 3.8 per cent to €1.89 billion, mostly due to higher income from income tax and social security. However, total spending went up by 6.2 per cent to €2.04 million, spread across both recurrent expenditure.…Read More