Tag Archives: expected

No skills shortage expected from FIFO recruitment drive

Posted February 21, 2013 14:12:01

Far north Queensland leaders say a new push to recruit fly-in, fly-out (FIFO) workers from the region is unlikely to create a local skills shortage.

The BHP Billiton Mitsubishi Alliance (BMA) will recruit 250 fly-in, fly-out workers from the Cairns region for its new Daunia and Caval Ridge coal mines in the Bowen Basin.

Cairns Mayor Bob Manning says the boost to the local economy outweighs his concerns about losing workers.

“In terms of attracting industry and diversification of the economy we’ve been out to lunch for a while,” he said.

“We’re back from lunch now.

“We’ll find the mining industry, because of the wages they pay, will attract people away but when men and women go to work on the mines they don’t intend to stay there for the rest of their lives.

“They’ll do two or three or four years there, they’ll get their back accounts nice and fat again and then they’ll come back to the coast again.”

Councillor Manning says there still are not enough job opportunities in the region.

“They don’t take people away forever,” he said.

“They go away, they’re away for awhile, they learn new skills, they come back and settle back into life on the coast, so I don’t see it as a great problem.

“The economy here hasn’t picked up pace yet. It’s starting to but it hasn’t picked up pace, so let’s just see what happens when we’re 12 months down the track.”

Meanwhile, BMA says salaries alone are expected to inject an estimated $40 million into the Cairns economy.

BMA asset president Stephen Dumble says the new workers will start at the mines in the second-half of the year.

“The company looked at Cairns because we’re looking to diversify where we draw our workforce from,” he said.

“We’ve said all along that fly-in, fly-out represents a good opportunity to spread the benefits of our growth and of our industry more broadly in the regions in Queensland and today’s announcement is a good recognition of that.”

Deputy Premier Jeff Seeney says it is good news for the Cairns economy.

“It’s 250 salaries that will be spent here on all of the service industries,” he said.

“All of the small businesses here in Cairns will benefit from having an extra 250 families earning a good wage in the central Queensland coalfields.”

Jo Pyne from Tropical North Queensland TAFE says it is looking at ways to plug potential skill gaps.

“I’m confident that we’ll be able to work with local industry to provide the skills that we need,” she said.

“We’ll be able to cope with the demand, I mean this isn’t a huge number that we’re talking about locally but we do need to be working very closely with industry to make sure we … don’t lose the skills that we need to keep industry running here.”

She says the company is looking for experienced mine workers and newcomers to the industry.

“We have been talking to them over the last 18 months really wanting to be quite clear about what their skills needs are so we can make sure that the training we’re delivering is providing skills to people who are interested in finding work in the mining industry,” she said.

Topics: mining-rural, mining-industry, activism-and-lobbying, community-development, regional, regional-development, work, cairns-4870, mackay-4740, rockhampton-4700

G20 not expected to criticise Japan

Finance ministers of the G20 nations meeting in Moscow may not criticise Japan for weakening the yen, a leaked draft communique has indicated.


The news sent the yen sharply lower, falling 1.5% against the dollar.


Japan’s new government has demanded looser monetary policy, causing the yen to fall 15% in value since September.


The weak yen gives Japan’s exporters a price advantage, raising fears of a “currency war” – competitive devaluations by other big exporters.


Meanwhile, the White House announced on Friday that President Obama would receive a visit from Japan’s recently elected Prime Minister Shinzo Abe on 22 February, although their talks would cover a broad range of concerns, and not just trade.


The draft wording, if it is adopted in the official communique, would mean the broader G20 group of nations agreeing to adopt a similar attitude towards Japan’s policies as the G7 earlier this week.


An unnamed G20 delegate was quoted by Reuters as saying: “There wasn’t anybody putting Japan on the spot. That’s quite frankly a bit of a surprise.”


The G7, which includes Japan, said they would not set targets for the exchange rates of their currencies.


As well as all of the industrialised nations of the G7, the G20 also comprises several major developing countries, including rival Asian exporting nations of Japan such as Korea and China.

Continue reading the main story Term used to describe competitive devaluationsCountries want to make their currencies cheaper because it makes their exports more competitiveThe last major currency war was in the 1930sChina, and many other G20 countries, do limit the trading in their currencies and set targets for their exchange rates.

‘Beggar thy neighbour’

Since Prime Minister Shinzo Abe won elections in December, his new government has pushed the Bank of Japan (BoJ) into accepting much bolder monetary policies, including a doubling of its inflation target, in order to revive the country’s moribund economy.


The Japanese authorities have not sought to intervene directly in the currency markets in order to influence the yen’s value, and unlike many other Asian exporters, it has a fully convertible currency, meaning that anyone can buy or sell the yen, and its value is set by the currency markets.

Continue reading the main story
There are countries within the G20 that actually set exchange rate targets. And that isn’t what Japan is doing”

End Quote Frances Hudson Standard Life Investments Instead, anticipation by the markets of Mr Abe’s elections, and the resulting flood of newly-created yen from the central bank’s change of attitude, has seen the yen fall steadily in recent months from all-time highs against the dollar and other major currencies, helping provide some relief to the country’s beleaguered exporters.


The previously strong yen had contributed to Japan experiencing a trade deficit – importing more than it exports – since 2011, following decades of surpluses.


Other industrialised economies such as the US and eurozone have expressed unease that the weaker yen, which gives Japan a competitive advantage, could be used as an excuse by other exporter nations to intervene directly in the currency markets in order to weaken their own currencies.


Such “beggar-thy-neighbour” policies might leave convertible currencies such as the dollar, euro and pound painfully overvalued.


“There are countries within the G20 that actually set exchange rate targets. And that isn’t what Japan is doing,” said Frances Hudson, a strategist at Standard Life Investments.


“Japan is doing what seems to be actions for economic reasons, such as tackling deflation,” Ms Hudson added.


Ahead of the G20 meeting, the BoJ governor Masaaki Shirakawa said the central bank will continue to ease policy in the future.


“The BoJ is conducting monetary policy to achieve stability in Japan’s economy. It will continue to do so,” he said.

Continue reading the main story Overblown? Meanwhile, another currency of concern has been the euro.


Recent data showed that, like in Japan, the eurozone recession also deepened more than expected in the final three months of 2012.


Some of the weakness of the eurozone economy has been blamed on a recovery in the value of the single currency area as the European banking and government debt crisis abated since last summer.


The euro has risen about 6% over the past six months. That increase has raised fears, amongst France in particular, that it will strangle growth further.


A stronger euro has undermined the competitive advantage of eurozone businesses in international trade.


The head of the European Central Bank, Mario Draghi, attempted to dampen talk about currency wars ahead of the meeting, by saying loose talk about currencies was “inappropriate, fruitless and self-defeating”.


However, Mr Draghi had himself deftly talked down the value of the euro at a regular press conference last week, when he said that the central bank was “monitoring” the exchange rate.


Nonetheless, Gerry Rice, a spokesman for the IMF, said that the talks of a currency war were “overblown”.


“Our multilateral assessment does not indicate very significant deviations from the fair value for the relevant currencies,” he added.

Bank Indonesia holds rate at 5.75pc as expected

JAKARTA: Text of Bank Indonesia’s policy statement, translated by Reuters.

The meeting of board of governors on February 12, 2013, decided to hold the BI rate at 5.75 percent.

The level of the BI rate remains consistent with manageable inflationary pressures well within the inflation target in 2013 and 2014 of 4.5 percent, plus or minus 1 percent. Bank Indonesia considers that the economy of Indonesia remains resilient, but is vigilant with rising pressures on external balances due to strong imports amid the global economic slowdown.

Looking ahead, Bank Indonesia will strengthen its policy mix to promote an adjustment in external balances so that the current account deficit will be at a sustainable level.

Bank Indonesia will maintain the stability of the rupiah in line with its fundamentals and promote a more efficient forex market. In addition, Bank Indonesia will strengthen coordination with the government to manage domestic demand, in order to maintain the sustainability of the macroeconomy and the sustainability of the nation’s growth.

Indonesia’s economy grew strongly, bolstered by domestic demand, although slowing from the previous period. Economic growth in the fourth quarter of 2012 was 6.11 percent, while the full year of 2012 rose 6.23 percent.

Consumption and investment in the fourth quarter stayed robust, even though at a moderate pace compared with the previous quarter. In the first quarter of 2013, economic growth is seen expanding 6.2 percent, mainly supported by domestic demand.

For the full year of 2013, after calculating economic activities in the third quarter and fourth quarter of 2013 including spending for general election preparations, economic growth is expected to expand between 6.3 percent and 6.8 percent.

On the external side, the balance of payments in the fourth quarter of 2012 improved in surplus despite a higher-than-expected current account deficit.

The improvement was due to better performance in capital and financial transactions which was supported by liquidity in the global financial markets.

In addition, the rising current account deficit was caused by a fall in the surplus of the non-oil and gas trade balance and an increasing deficit in the oil and gas trade balance.

Looking ahead, the current account in the first quarter of 2013 is expected to improve, mainly due to a better performance in exports in line with economic recovery in major trade counterpart countries such as China and the US

In January 2013, the rupiah weakened by 0.22 percent month-to-month to 9,654 per US dollar with manageable volatility. Looking ahead, Bank Indonesia will maintain the stability of the rupiah within the fundamentals of the economy.

In addition, Bank Indonesia will promote the establishment of a reference exchange rate of the rupiah in the domestic spot market. The reference is aimed to add liquidity and efficiency in the forex market so that it can deepen the domestic forex market.

The consumer price index in January 2013 increased but is expected to be manageable within its target. January inflation was 1.03 percent month-to-month or 4.57 percent year-on-year as a result of heavy rains which caused disruption in distribution and production. Meanwhile, core inflation remains stable at 4.32 percent year-on-year, supported by relatively manageable inflationary expectations, well-managed demand in line with production capacity, as well as a manageable exchange rate of the rupiah.

Looking ahead, there are some risk factors that need to be observed which can increase inflationary pressure, such as weather that can disturb production and food distribution, and increasing of some administered prices.

The stability of the financial system and banking intermediary function is well maintained. Loan growth at the end of December 2012 was 23.1 percent year-on-year. Growth in loans for working capital was quite high at 23.3 percent year-on-year and investment loans rose 27.4 percent year-on-year, and are expected to increase the capacity of the economy.

Meanwhile, consumer loans grew 20 percent year-on-year. Looking ahead, Bank Indonesia believes that stability of the financial system will remain, with increasing banking intermediary functions in tandem with better performance of the economy.

Copyright Reuters, 2013

Traders expected to seek phone outage compo

Posted January 30, 2013 14:22:22

North Queensland businesses estimate the cost of the weekend’s Telstra outage to run in the hundreds of thousands of dollars.

Many regional phone and internet services were lost for almost 24 hours after flooding washed out a coastal cable and a landslide damaged an inland back-up link.

In Charters Towers, the outage coincided with the town’s main tourist drawcard, the annual Goldfield Ashes cricket tournament.

Charters Towers Chamber of Commerce president Tom Hogg says local businesses rely heavily rely on the weekend’s takings.

“I know talking to some of the hotels here, between just four hotels alone, they’ve told me they’ve lost nearly $100,000 in trading,” he said.

“Bottle shop takings are down there.

“Some of their takings are worse than a normal weekend and generally, as I said, this is the biggest take for a lot of businesses for the entire year.

“Businesses will be looking for compensation yes and rightfully so.

“If a service is supposed to be provided and if that service hasn’t been provided because redundant systems and back-up hasn’t been allowed for, then I believe a lot of these businesses should be entitled to some sort of compensation.”

Topics: small-business, regional-development, community-and-multicultural-festivals, regional, national-days, floods, australia-day, activism-and-lobbying, charters-towers-4820, townsville-4810

India central bank cuts rates by 25bps as expected

MUMBAI: India’s central bank reduced its policy interest rate by a widely expected 25 basis points on Tuesday, taking comfort from cooling inflation as it made the first cut in nine months to support an economy headed for its slowest growth in a decade.


The Reserve Bank of India (RBI) cut its key repo rate to 7.75 percent, as forecast by a Reuters poll.


The RBI unexpectedly also reduced the cash reserve ratio (CRR), the share of deposits banks must keep with the central bank by 25 bps to 4.00 percent, which will infuse an additional 180 billion rupees into the banking system.

Copyright Reuters, 2013

Early gains expected on share market

By finance reporter Rebecca HyamPosted January 21, 2013 08:53:47

It is expected to be a good start to the trading week, with Australian shares tipped to capitalise on Wall Street’s gains from last Friday.

News that US Republicans might agree to raise the debt ceiling helped push the Dow Jones Industrial Average up 53 points to 13,649.

The S&P 500 gained 5 points to 1,486.

Those are the highest closing levels for each index since late 2007.

Poor earnings from Intel weighed on the Nasdaq, which closed down 1 point to 3,134.

In local futures trading, the Share Price Index 200 was up 17 points, indicating gains of about 0.4 per cent when the Australian market opens.

The Australian dollar was reasonably steady at 105.12 US cents by 8:50am (AEDT).

Topics: business-economics-and-finance, markets, currency, futures, stockmarket, australia

Unemployment expected to rise


Economists are unanimously tipping that today’s official figures will show unemployment rose in December, as job creation slowed.


The Bureau of Statistics figures are expected to show the jobless rate rose to 5.4 per cent in December, up from 5.2 per cent in November.


There is not a single bank economist among the 27 surveyed by Bloomberg forecasting that unemployment will fall or even remain steady, with some expecting a modest rise to 5.3 per cent, most an increase to 5.4 per cent, and one analyst forecasting a jump in the jobless rate to 5.5 per cent.


Job creation is expected to have been weak, with indicators of hiring intentions all suggesting that employers are hesitant to take on new workers.


Estimates of job creation range from the addition of 16,000 positions to the loss of 10,000 jobs, with forecasts centring on a rise of just 4,500.


NAB senior economist Spiros Papadopoulos says, while the headline unemployment rate is low, it is hiding weakness in the labour market.


“Given that the participation rate has also been easing, we expect that that easing in job ads and also the softening in employment growth does mean that the unemployment rate will trend higher,” he predicted.


Mr Papadopoulos expects unemployment to keep rising to reach 5.75 per cent by the end of the year.


“Although the unemployment rate still looks pretty good at 5.25 per cent, it is obviously being held down somewhat by the fact that less people are looking for work as a percentage of the total population, and the fall in the participation rate in recent months has helped sustain the unemployment rate at these low levels,” he explained.


Many economists say the expected rise in unemployment could clear the way for more interest rate cuts from the Reserve Bank, possibly as early as its next meeting in February.

Topics: business-economics-and-finance, economic-trends, unemployment, australia

Road link to be opened earlier than expected


Almost 40 years since it was first touted, the Peninsula Link freeway connecting Carrum Downs and Mount Martha will open to traffic on Thursday night.


The toll-free road will shave 40 minutes off the average peak hour journey.


The Premier Ted Baillieu says the road, started by the former Labor government, will attract more tourists to the Mornington Peninsula.


“This freeway will assist many communities to spend less time in traffic and more time with family and friends,” he said.


Mr Baillieu said Victorians will be able to travel all the way from central Melbourne to the Mornington Peninsula without encountering a single traffic light.


“Peninsula Link will give people the choice to bypass the nine sets of traffic lights and six major roundabouts that exist on the current route,” he said.


The 27 kilometre road has been under construction since 2010.


It will be fully operational by Friday morning’s peak.

Topics: road, road-transport, state-parliament, vic, mount-martha-3934, carrum-downs-3201

First posted January 16, 2013 13:26:38

Nokia sales better than expected

10 January 2013 Last updated at 22:10 GMT Continue reading the main story Nokia shares have risen sharply after the Finnish group said mobile phone sales in the fourth quarter exceeded its own expectations.

Nokia said it sold 86.3 million devices in the last quarter, with revenues totalling 3.9bn euros ($5.2bn; £3.2bn).

It said its mobile phone business had achieved underlying profitability, thanks to better-than-expected sales of its Lumia smartphone.

Nokia shares closed up 11% in Helsinki and 18.7% higher in New York.

The firm sold 4.4 million Lumia smartphones in the fourth quarter, up from 2.9 million in the third quarter.

It also sold 2.2 million Symbian smartphones and 9.3 million of its lower-priced Asha full-touch smartphones.

Nokia said it was also helped by lower-than-forecast operating expenses.

But it expects seasonality and a competitive environment to have a negative impact on the handset division’s profitability in the first quarter of 2013.

Nokia has been losing ground to rivals Apple and Samsung in recent years.

Redeye analyst Greger Johansson said it was still too early to call it a turnaround.

“They will have to prove a lot more until you can say that,” he said.

“I’m not still convinced that they are going to manage to succeed with those new smartphones. They have to sell a lot more in volumes until you can say that.”

Nokia sales better than expected

Continue reading the main story Nokia shares have risen sharply after the Finnish group said mobile phone sales in the fourth quarter exceeded its own expectations.


Nokia said it sold 86.3 million devices in the last quarter, with revenues totalling 3.9bn euros ($5.2bn; £3.2bn).


It said its mobile phone business had achieved underlying profitability, thanks to better-than-expected sales of its Lumia smartphone.


Nokia shares closed up 11% in Helsinki and 18.7% higher in New York.


The firm sold 4.4 million Lumia smartphones in the fourth quarter, up from 2.9 million in the third quarter.


It also sold 2.2 million Symbian smartphones and 9.3 million of its lower-priced Asha full-touch smartphones.


Nokia said it was also helped by lower-than-forecast operating expenses.


But it expects seasonality and a competitive environment to have a negative impact on the handset division’s profitability in the first quarter of 2013.


Nokia has been losing ground to rivals Apple and Samsung in recent years.


Redeye analyst Greger Johansson said it was still too early to call it a turnaround.


“They will have to prove a lot more until you can say that,” he said.


“I’m not still convinced that they are going to manage to succeed with those new smartphones. They have to sell a lot more in volumes until you can say that.”

Nokia sales better than expected

10 January 2013 Last updated at 22:10 GMT Continue reading the main story Nokia shares have risen sharply after the Finnish group said mobile phone sales in the fourth quarter exceeded its own expectations.

Nokia said it sold 86.3 million devices in the last quarter, with revenues totalling 3.9bn euros ($5.2bn; £3.2bn).

It said its mobile phone business had achieved underlying profitability, thanks to better-than-expected sales of its Lumia smartphone.

Nokia shares closed up 11% in Helsinki and 18.7% higher in New York.

The firm sold 4.4 million Lumia smartphones in the fourth quarter, up from 2.9 million in the third quarter.

It also sold 2.2 million Symbian smartphones and 9.3 million of its lower-priced Asha full-touch smartphones.

Nokia said it was also helped by lower-than-forecast operating expenses.

But it expects seasonality and a competitive environment to have a negative impact on the handset division’s profitability in the first quarter of 2013.

Nokia has been losing ground to rivals Apple and Samsung in recent years.

Redeye analyst Greger Johansson said it was still too early to call it a turnaround.

“They will have to prove a lot more until you can say that,” he said.

“I’m not still convinced that they are going to manage to succeed with those new smartphones. They have to sell a lot more in volumes until you can say that.”

Nokia sales better than expected

Continue reading the main story Nokia shares have risen sharply after the Finnish group said mobile phone sales in the fourth quarter exceeded its own expectations.


Nokia said it sold 86.3 million devices in the last quarter, with revenues totalling 3.9bn euros ($5.2bn; £3.2bn).


It said its mobile phone business had achieved underlying profitability, thanks to better-than-expected sales of its Lumia smartphone.


Nokia shares closed up 11% in Helsinki and 18.7% higher in New York.


The firm sold 4.4 million Lumia smartphones in the fourth quarter, up from 2.9 million in the third quarter.


It also sold 2.2 million Symbian smartphones and 9.3 million of its lower-priced Asha full-touch smartphones.


Nokia said it was also helped by lower-than-forecast operating expenses.


But it expects seasonality and a competitive environment to have a negative impact on the handset division’s profitability in the first quarter of 2013.


Nokia has been losing ground to rivals Apple and Samsung in recent years.


Redeye analyst Greger Johansson said it was still too early to call it a turnaround.


“They will have to prove a lot more until you can say that,” he said.


“I’m not still convinced that they are going to manage to succeed with those new smartphones. They have to sell a lot more in volumes until you can say that.”


View the original article here

Borrowing grows more than expected

21 December 2012 Last updated at 18:03 GMT ONS chief economist Joe Grice: “There are straws in the wind that look promising”

The government had to borrow slightly more than expected in November.

It borrowed £17.5bn, £1.2bn higher than a year earlier, official figures show. Economists had predicted borrowing would fall slightly to about £16bn.

However, the Office for National Statistics said a 0.1% growth in the all-important services sector of the economy was “promising”.

It also revised down its estimate for growth between July and September to 0.9% from 1%.

The UK’s official statistics authority regularly revises its data on the value of the output of the economy as more information is collected from businesses.

Economists were divided as to what the different figures said about the state of the UK economy.

“All in all, the UK appears to be ending 2012 not in particularly great shape,” said James Knightly from ING.

However, for Alan Clarke from Scotiabank, the growth in services “makes it all the more likely that the UK did not slip into a triple-dip recession at the end of the year”.

The Bank of England said earlier this week that it thought the UK economy would contract again in the last three months of the year following the strong growth between July and September, when the economy received a boost from Olympic ticket sales.

Continue reading the main story ‘Significant’ investment The services sector grew 1.2% over the period and “held on” to those gains in October, the Office for National Statistics said.

Joe Grice, chief economist at the ONS, described the service sector gains as “promising straws in the wind” for the UK economy.

He also described a £1.1bn rise in business investment to £31.5bn as “significant”.

But the economy as whole still remains 3% below its pre-recession 2008 peak, he said.

Meanwhile consumer confidence remains volatile, according to a survey by research firm GfK on Friday showing a “dramatic” fall in confidence in December, contrasting strongly with an equally sharp rise in November.

Public borrowing The BBC’s Declan Curry explains just what GDP stands for, and why we should care

The bigger-than-expected increase in government borrowing adds to the problems faced by Chancellor George Osborne as he struggles to reduce public borrowing in the face of a stuttering economy.

November’s figure takes total borrowing so far this financial year to £92.7bn, £8.3bn more than the same period in 2011.

Danny Alexander, Chief Secretary to the Treasury said: “These figures reflect the fact that this country continues to be on a hard and difficult road back to economic prosperity.

“We’re making real progress getting public spending down; we’ve reduced the deficit by a quarter over the last couple of years and a million jobs have been created in the private sector.”

“But these figures today on borrowing and on growth reflect the fact that this country continues to face tough economic challenges, and that will continue to be the main priority for the coalition as we go into the new year.”

Rachel Reeves MP, Labour’s shadow chief secretary to the Treasury, said: “For all the chancellor’s smoke and mirrors in the autumn statement, these figures show that borrowing is rising and is up by almost 10% so far this year.

“The failure of David Cameron and George Osborne’s policies on jobs and growth means they are now even failing on the one test they set themselves – to get the deficit and debt down.”

Unemployment expected to edge higher

By finance reporter Elysse MorganPosted November 08, 2012 09:31:20

Most economists expect official figures due out today will show the unemployment rate is continuing its rise.

The data is widely tipped to show that fewer than 1,000 full-time jobs were added in October, with the jobless rate rising to 5.5 per cent.

The employment rate jumped from 5.1 to 5.4 per cent in September.

However, Commonwealth Bank senior economist Michael Workman is one of the few who believe the jobless rate will remain unchanged at 5.4 per cent.

“The way the jobs the labour markets working currently is that there are jobs growth centres, and that’s mainly out of the services areas like health and education and some parts of retailing, and there’s quite noticeable and widely reported job losses going on in manufacturing and those other parts of the economy, so the net result is a pretty flat jobs market,” he said.

HSBC Australia chief economist Paul Bloxham also believes unemployment will remain steady, as the RBA’s earlier rate cuts start to take effect on some labour intensive sectors.

“We’re expecting to see an upswing in the housing construction cycle, so construction will get a bit of support in terms of employment,” he explained.

Michael Workman says if he is wrong and the unemployment rate does rise again, it could be one of the key pieces of data that might bring more interest rate relief for borrowers.

“I think it would be one of the factors that would help the argument for a rate cut in December,” he said.

“There’s a few more bits of information coming out over the next few days that may help them frame that – there’s the wages data, which is obviously fairly important as well, because wages are one of those costs that has a fairly big influence over the inflation numbers.”

Topics: business-economics-and-finance, economic-trends, money-and-monetary-policy, unemployment, australia

Office rents in Abu Dhabi expected to drop further

Office rents in Abu Dhabi are expected to drop further in the next six months in single digit figures, as new commercial developments continue to further swell supply, a new report said.

Demand for offices in the capital is anticipated to improve over the next 12 months, as the private sector sees improving conditions amid continued government investment, but supply will continue to overtake new demand, according to the Abu Dhabi Office and Residential Marketview Q3 report.

“Despite the sustained downward movement of rental rates, the rate of decline is slowing and is now at its lowest level since the start of the property slump,” the report stated.

Article continues below

Average rents in the emirate fell by two percent in the third quarter over the previous quarter while prime office rents in Abu Dhabi’s premium developments were flat at Dh1,600 to Dh1,900 metre square per year.

In the residential market, average rents have dropped six percent compared in the third quarter compared to the previous quarter with some properties seeing static rents and others having a decline of 3 to 9 per cent, the report showed.

“At this point in the development cycle, we see no immediate end to this trend with better quality inventory entering the market, adding pressure to ageing and/or inferior units,” it stated.

Emirates expected to buzz with tourists this Eid holiday

Dubai: Expect bumper-to-bumper traffic and shoulder-rubbing crowds around Dubai as tourists from the Gulf countries descend on the UAE for the Eid holidays, which falls on a long weekend.


Hotels are anticipating 80 to 100 per cent occupancy during Eid and some are already fully booked, hotel managers said. Travel agents are seeing an increase of up to 20 per cent in inbound travel bookings compared to last Eid Al Adha.


The Department of Tourism and Commerce Marketing (DTCM) is expecting a 10 per cent increase in the number of hotel guests to Dubai this Eid compared to the same season last year, Eyad Ali Abdul Rahman, executive director of media relations and business development at DTCM, told Gulf News.


For tourists visiting the UAE this Eid, Dubai seems to be the number one destination, but some visiting families prefer the quiet ambience of areas around the Northern Emirates, especially Ras Al Khaimah and Fujairah, according to travel agents, hoteliers and analysts.

Article continues below


The Dubai 24-Hour Shopping initiative is also expected to draw more crowds from the GCC this year as trawling the malls and staying up late into the early hours of the morning is part of the culture, they said.


They said the majority of visitors to the UAE this Eid are coming from Saudi Arabia, followed by Qatar and Kuwait.

Related Links Capital emerges as big tourist attraction

In Dubai, Arabian Courtyard Hotel and Spa is expecting 100 per cent occupancy during Eid and a higher average daily rate than last year, said general manager Habib Khan.


The Ramada Downtown in Dubai is forecasting 90 per cent occupancy during Eid and is currently at 85 per cent of bookings, said general manager Wael Al Behi.


Al Bustan Centre and Residence in Dubai is anticipating 75 to 85 per cent occupancy in its 640 units with 80 per cent of visitors from GCC countries, said hotel chief executive Mousa Al Hayek.


Dubai will be getting the lion’s share of the visitors, said Peter Goddard, managing director of TRI Hospitality Consulting.


“It’s going to be exceptionally busy… Dubai is a market now in its own right, it has its own critical mass and unique selling propositions that people like: shopping, nice hotels, beaches and it is seen as a safe destination,” he said, adding that until the political problems in Egypt and Lebanon subside, Dubai will continue to benefit from the visitors coming here.


The Northern Emirates will be attracting some Eastern European visitors, hoteliers and travel agents have said.


The Iberotel Miramar Al Aqah beach resort and Concorde Hotel Fujairah are expecting 100 per cent occupancy during Eid from expats, GCC nationals and CIS states, hotel managers said.


“Dubai remains number one, but when you look at the investments made by Ras Al Khaimah it is quite progressive because they have resorts and their own airport. It’s very much a secret weapon for RAK. They’re there for the future. People are always looking for something away from the city,” said William Horsley, general manager of the travel division in Al Futtaim Group.


Though popular with GCC visitors, the number of Saudi visitors to Dubai reached 900,000, according to Gassan Aridi, chief executive of Alpha Tours. However, the UAE is also drawing more visitors from India.


“There are a lot of bookings from Indians this year in the five-star hotel segment… Discretionary incomes have gone up big time and Dubai is close to India,” said Sunil D’souza, regional travel director of Kanoo Travel.


Travel agents reported brisk business this Eid, with Kanoo Travel reporting 20 per cent increased bookings and Alpha Tours seeing 21 per cent, they said.


The long weekend and the 24-hour shopping opportunity are clear draws for GCC visitors, according to the DTCM.


“It’s part of the mentality, some people sleep by day, are awake all night and their morning starts late. They go to the malls,” Aridi said.


UAE residents wishing to take staycations might find it difficult as hotels fill up quickly and raise their prices during Eid, Horsley said.

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HIA says house building starts expected to surge

Updated October 22, 2012 13:22:01

The Housing Industry Association says a report out today which points to weak housing construction figures in Western Australia is out of date.

A report by CommSec shows building approvals in the state have slumped by 27 per cent compared to the long term average.

The HIA’s John Dastlik says State Government changes to the Building Act earlier this year caused problems which saw building approvals fall sharply.

“The slump is predominantly due to a fall in building approvals in the June quarter and that was as a result of the introduction of the new Building Act,” he said.

“There were a lot of new processes to be put in place and both builders and local governments had to get their minds across the issue as to how the new process worked.”

Mr Dastlik says those problems have been rectified and there has been a surge in building approvals in recent months.

He says dwelling starts are expected to surge by more than 20 per cent this financial year.

“We’re starting to see some very significant improvement, for example, in building finance; last month, in August, we recorded the highest level of building finance for new housing construction for the last ten years.

“So, the initial signs for an improvement in the number of building starts in the September and December quarters is certainly there.

“We’re forecasting an improvement of some 23 per cent throughout the 12/13 financial year in comparison to the 11/12 financial year.

“The market certainly has turned in Western Australia and I think give it another couple of quarters and you’ll start to see that WA is probably leading the nation in terms of its growth in dwelling housing starts.”

Topics: housing-industry, perth-6000

First posted October 22, 2012 13:05:34

Brisbane Airport Link use drop ‘expected’

Posted October 03, 2012 10:57:34

The operator of Brisbane’s newest toll road says a drop in the number of cars using Airport Link in September was expected.

There were 74,500 vehicles a day on average, down about 7,000 on the August figures.

BrisConnections says September was not a typical month because it had five weekends and school holidays.

Discounted Airport Link tolling starts in a fortnight.

Topics: road-transport, public-sector, brisbane-4000

Unemployment expected to rise

Updated October 11, 2012 09:08:24

The official employment figures are expected to confirm a weakening labour market when they are released later today.

The consensus forecast of economists is for 5,000 jobs to have been added to the economy in September.

However, that would not be enough to stabilise the jobless rate which is expected to rise to 5.3 per cent from 5.1 per cent in August.

The Reserve Bank will be looking closely at the figures after noting in recent statements the labour market may be weaker than the data suggests.

Economists say the shelving of a number of projects in the mining sector is slowing the pace of jobs creation.

UBS senior economist George Tharenou says the mining sector has been responsible for much of the country’s recent job creation.

“Over the past three months we saw the first fall in mining employment in the last couple of years since the GFC, that was previously the strong driver of jobs growth,” he said.

“Given the weakness in commodity prices over the year, it does look like we’ve seen the best of times for the mining sector.”

Mr Tharenou says the benefit to other sectors of the economy from lower interest rates will not be seen in the employment figures for some time.

“There has been persistent softness in leading indicators of employment which implies that jobs growth will remain subdued over the coming year at around the lowest level in a couple of decades,” he observed.

“It is a tough period of adjustment in the economy, but at the same time the RBA is cutting interest rates quite substantially.”

The official Bureau of Statistics employment figures will be released at 11:30am (AEDT).

Topics: business-economics-and-finance, economic-trends, money-and-monetary-policy, work, unemployment, australia

First posted October 11, 2012 09:06:47

Small share gains expected following mildly positive lead

By finance reporter Justine ParkerPosted October 04, 2012 08:52:08

Global markets have seen small gains, after positive news on the US economy helped trade on Wall Street, but oil prices dropped amid concerns about global economic growth.

In the United States, a study showed the services sector grew at a faster rate in September.

Figures also showed that job creation by private companies beat expectations.

The Dow Jones was 0.1 per cent higher at 13,495, the S&P 500 rose 0.3 per cent to 1,451, and the Nasdaq Composite Index rose 0.5 per cent to 3,135.

Shares in computer giant Hewlett-Packard dropped to a nine-year low after its chief executive, Meg Whitman, said she expected full-year profit to come in below expectations.

The company is struggling to turn around its weak performance. It has had six chief executives in seven years.

Over in Europe, results were mixed after a survey showed economic conditions worsened in the eurozone last month.

Investors are also still waiting for some clarity on when Spain will request a bailout.

The FTSE 100 in London gained 0.3 per cent to 5,826 and the DAX in Germany rose 0.2 per cent, but the CAC 40 in France fell 0.25 per cent.

In futures trade locally, the ASX SPI 200 index was 12 points higher at 4,447, suggesting a positive start to trade on the Australian market.

In commodity trade, spot gold remains at year highs, worth $US1,778 dollars an ounce.

West Texas crude oil dropped to $US88 a barrel, amid concerns about demand for crude oil and global growth.

In currency trade, the Australian dollar was down further against the greenback after figures yesterday showed Australia’s trade deficit ballooned in August.

It was buying point 102.1 US cents, 79.2 euro cents, 80.2 Japanese yen, 63.5 British pence and nearly $NZ1.25.

Topics: business-economics-and-finance, markets, currency, stockmarket, futures, australia

Petrol price expected to decrease

ISLAMABAD: The price of petrol is expected to be reduced by Rs.3 per litre where as diesel is expected to be increased by Rs.3 from 15th October. The price of CNG is also expected to go down by Rs.2.75 because of the reduction in petrol prices.

According to sources in the petroleum ministry, the price of all petroleum products except petrol is expected to rise.

Price of Kerosene oil and light diesel is expected to rise by Rs.1 and Rs. 1.50 per litre respectively.

A final summary by OGRA based on the prices used by the oil marketing companies will be sent to the petroleum ministry on Saturday.

Hospitality market in GCC expected to grow 8.1%

Abu Dhabi: The GCC’s hospitality market is expected to grow at an annual rate of 8.1 per cent to $28.3 billion by 2016 compared to $19.2 billion in 2011, according to Alpen Capital’s industry report published on Sunday on the hospitality sector in the GCC.


The report focuses on key performance indicators of the GCC region’s hospitality industry such as the number of hotel rooms, average daily rate (ADR), occupancy rates, RevPAR, growth rates, and the industry’s outlook over the next five years.


According to the report, occupancy rates are expected to average around 67–73 per cent between 2012 and 2016. ADR is likely to average around $212–$247 between 2012 and 2016, it said.


It is difficult to look at the GCC region as a whole when referring to the hospitality industry “as each market has its own idiosyncrasies,” said Christopher Hewett, consultant with TRI Hospitality Consulting. “We would look at each country and evaluate a cross section of variables,” he said.


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According to the report, Saudi Arabia remains the largest GCC market in terms of revenues, followed by the UAE. “Qatar is expected to be one of the fastest growing markets, driven by rising business tourism and leisure tourism as the country prepares itself for the Fifa World Cup 2022, and in order to achieve its 2030 national vision,” it said.?


As for the UAE, which is strongly marketing itself as a world tourist destination, the hospitality sector is expected to grow at a CAGR (compounded annual growth rate) of 10.4 per cent over 2011-2016, which would be due to strong tourist inflows and steadily strengthening operating metrics, the report said.


Tourist arrivals in the UAE is likely to grow at a CAGR of 5.3 per cent between 2012 and 2022. Hotel supply in the UAE is expected to increase at a CAGR of 5.3 per cent from 96,992 hotel rooms in Dubai and Abu Dhabi to 125,383 in 2016. There are currently 93 properties in the planning and construction phase in the UAE.


Hewett told Gulf News that the projects for future room supply is in line with their data. “We believe that the increase in rooms, particularly in Abu Dhabi, will put continued pressure on a market which is currently facing challenges from increased supply,” he said. “Dubai hotels have witnessed an increase in performance in 2012 as the city benefits from an increase in leisure tourism as a result of the ongoing unrest in the Levant region. In addition, Dubai has witnessed an improvement in business sentiment which has resulted in stronger demand from the corporate segment.”


Occupancy rates are expected to grow from 71 per cent in 2011 to 75.1 per cent in 2016 as the tourist arrivals growth momentum picks up. As business travel in the country continues an uptrend, leisure demand for the upscale segment grows. ADR is expected to increase at a CAGR of 3.7 per cent from $183.5 in 2011 to $220 by 2016.


As hotel room supply in the region is expected to grow with the rise in demand, oversupply of hotel rooms could be a challenge for the market going forward. It could affect the performance of the industry by reducing occupancy rates and by putting pressure on ADRs.


“Although the market will witness an increase in supply in late 2012 and early 2013, particularly around Shaikh Zayed Road, we feel the hotels will be able to achieve solid performance levels albeit with marginally lower occupancies and average daily rates,” he said.


“Abu Dhabi hotels will continue to experience challenges from an increase in supply and limited demand generators over the next two to three [years]. The current development of leisure infrastructure, notably on Saadiyat with the Cultural District, is a positive step in strengthening leisure tourism. However, in the meantime, hotels will need to ensure that they do not fall into a looming rate war with new entrants, and look at providing value for money for new and existing guests.”

$5b in hotel upgrades expected

BloombergA room is prepared for guests at a hotel in Los Angeles. Hotels in the US are adding many new amenities.

All of those shiny new amenities you’ve seen at your hotel lately — fitness equipment, flat-screen TVs and redesigned lobbies — are part of a trend across the country.


Hotels are expected to spend $5 billion (Dh18.3 billion) on improvements in 2012, a 33 per cent increase over 2011, said Bjorn Hanson, a dean at New York University’s Preston Robert Tisch Centre for Hospitality, Tourism and Sports Management.


The spending still falls below the high mark of 2008, when the hotel business was booming and the industry spent $5.5 billion.


What are hotels spending all that money on? The added amenities include redesigned rooms, new bedding and beds, high-speed internet access, flat-screen TVs, renovated restaurants and upgraded exercise rooms, Hanson said. Most of the spending has gone to renovate lobbies.


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“If the lobby looks like it’s recently been renovated, it projects on the rest of the hotel,” Hanson said. Hotel owners are spending more partly because they are enjoying higher occupancy rates and daily fares than in the last few years, he said. The managers of big-chain hotel brands are also pressing independent hotel owners to make upgrades that had been deferred because of the tough economy. Not to mention, hotel guests have been complaining about tired-looking hotel facilities.


“Individual brands and hotels are receiving complaints in comment cards and things like that,” Hanson said.


Among the high-tech amenities that many pricey hotels have been adding in the last two years is the in-room iPad.


In many hotels, the tablet is loaded with software that lets guests tap the screen to order room service, call for a taxi or request a bill to check out. The Hotel Bel-Air in Los Angeles and the Four Seasons Hotel Los Angeles at Beverly Hills both offer in-room iPads.


A new study by the company that makes the software for iPads at 53 hotels across the country found that 82 per cent of guests who had access to the tablets used them an average of 11 times per stay.


Of the guests who used the hotel iPads, 41 per cent ordered in-room food, 21 per cent requested a wake-up call and 7 per cent called for a housekeeper, according to the study by Intelity.


“In-room tablets have quickly become the new mark of luxury service in hotels,” said David Adelson, chief executive of the Orlando, Florida, company. Despite the popularity of iPads, hotels don’t seem to have a problem with guests taking home the tablets. Some hotels attach the iPads by a cable to furniture in the room. Others warn guests when they check in that if the iPad goes missing, the hotel will tack a fee of up to $800 on their bill.


In the last two years, Intelity said it has received only two reports of damaged iPads and no reports of missing devices.


Depending on whom you talk to, Spirit Airlines is either the industry’s top innovator or greatest abuser of passenger fees.


The Florida airline, which lists 72 fees in eight categories on its website, announced last week that starting on November 6 it will charge passengers $100 for a carry-on bag, up from the current fee of $45.


In 2010, Spirit became the first US airline to impose a fee for carry-on bags.


The higher fee will be levied against passengers who wait until they reach the gate to pay the fee. The airline said it is raising the fee to discourage passengers from slowing the boarding process by waiting until the last minute to pay the fee.


“Our goal is for no customer ever to pay the $100 fee,” Tony Lefebvre, chief operating officer for the airline, said in a statement


Spirit passengers who pay the carry-on bag fee online before getting to the airport will pay $35, an increase from the current $30 fee.


If you’re having a hard time finding short-haul flights to small and medium-size cities, it’s not your imagination.


A new study by the Office of Inspector General of the US Department of Transportation concluded that the elimination of thousands of flights of less than 804km is one result of the airline industry’s efforts to prosper in the face of higher fuel costs and economic turbulence in the last few years.


Another strategy airlines have used to rebound from the dismal financial times that followed the September 11 terrorist attacks and the Great Recession: Packing more passengers in bigger planes so that the chances of stretching out to an adjacent empty seat are almost nil.


The good news is that airlines have seen profits grow in the last few years, the report said. It noted that the nation’s largest airlines earned about $5 billion in profits in 2011, compared with 2002 when the industry lost a combined total of $9.2 billion. In addition, the airlines have improved on-time performance and cut the number of cancelled flights.


But the bad news for passengers is that five airlines now serve 85 per cent of the market in the US, compared with 2000 when 10 airlines served more than 90 per cent of the market. In addition, airlines have eliminated thousands of flights, especially short-haul flights using smaller planes.


Of the 457 airports in the country, 61 have lost half or more of the carriers serving their communities over the last five years. Meanwhile, the number of flights of less than 804km have been cut by 3,000 a day in that same period, according to the report.


The hardest hit cities have been Cincinnati, with a 63 per cent cut in scheduled flights; Pittsburgh, with 40 per cent fewer flights; and Memphis, with 35.5 per cent fewer flights, according to the report.


“The industry’s strategies of consolidating airlines, cutting flights and raising fares have produced positive financial results,” the report concluded.


A spokeswoman for Airlines for America, a trade group that represents the nation’s airlines, said the industry has cut many domestic flights and reduced seating but only to better match demand.


Looking to save money on a flight? Your best bet is to book your flights 21 days before departure, according to a new study by the travel booking website Kayak.


Over a six-month period before departure, the average fare for a domestic flight is $370, according to a study of millions of flights booked by Kayak users. But that fare drops to its lowest level — $342 — when booked 21 days before departure, according to Kayak.


For international flights, the lowest fare can be booked 34 days before departure, when the average price is $977, compared with $1,016 for the six-month period before take-off, the study said.


Other tips: If you’re taking a quick domestic trip, you can save as much as 16 per cent on an airfare by departing on a Saturday and returning Monday. For trips more a week long, you can save as much as 10 per cent by leaving on a Tuesday and returning on a Wednesday.


For quick international flights, you can save 21 per cent if you leave on a Tuesday and return the following Wednesday. For international trips longer than a week, you can save 9 per cent if you leave on a Saturday and return on a Sunday.


If you think booking a flight online is too complex, CheapAir.com says it may have the solution for you. The travel website recently unveiled a search feature that lets you type in your travel needs in a simple statement, instead of punching in destination, dates and times in several fields.


For example, people who use the feature, called Easy Search, can type in a sentence such as “LA to Newark on July 3, returning on the 10th.” The software at the travel site will decipher the airport codes and calendar dates and display the flights that best fit your needs, according to CheapAir. “Easy Search is one more thing we’re doing differently than the competition to make it easier to book travel arrangements,” said Jeff Klee, chief executive of CheapAir.


Still, there may be one easier way to book travel: Call a travel agent.

Expo expected to fetch $1b worth of orders

Buyers from at least 70 countr­ies coming to visit flagsh­ip fair. “At least 670 buyers from 70 countries had confirmed their participation in the Expo, which will continue until October 7,” says Tahir Raza Naqvi. PHOTO: TDAP

KARACHI: 

With more international buyers committing to arrive this year, the Trade Development Authority of Pakistan (TDAP) is targeting business deals of $1 billion from its annual flagship exhibition – Pakistan Expo 2012 – starting from October 4 in Karachi.

“Last year, we got foreign orders worth $517 million when 500 overseas buyers visited the Expo. Going a step further, this year we are targeting $1 billion worth of orders,” said TDAP Chief Executive Tahir Raza Naqvi while speaking at a pre-event press conference at the TDAP head office here on Monday.

Naqvi, who took office two months ago, said at least 670 buyers from 70 countries had confirmed their participation in the Expo, which will continue until October 7, and expected the total number to cross 1,000.

“This year, we are expecting more foreign buyers than last year, so we anticipate much more business deals between local and foreign businessmen,” he said.

“This is our flagship event and provides a good opportunity to dispel the negative impression of Pakistan from the minds of foreign businesspersons,” said Naqvi. “We are using all our resources to make the event successful because Pakistan desperately needs such events to showcase ‘Made in Pakistan’ products.”

He claimed that gradually the Expo was gaining popularity not only among local exhibitors, but also among foreign buyers.

Replying to a question, he put expenditures made on Expo 2011 at Rs90 million and said the expenses would be restricted to Rs100 million this year. “We know we have limited funds, which is why we are trying to make the most from our limited resources.”

TDAP will try to take the help of technology to follow up expected business deals. “We want to make sure that local exhibitors and foreign buyers build up long-term partnerships so that we can attract more foreign buyers in coming years.”

Among foreign visitors, 35 buyers are expected to come from Japan, 68 from Malaysia, 35 from Poland, 22 from Spain, 23 from India, 18 from Russia and 16 each from Brazil and Nigeria.

Like previous year, TDAP is also organising a fashion show to promote the country’s textile products and designer lawns, which have got extraordinary response in Indian and other foreign markets in recent years.

TDAP officials are very pleased to see the popularity of Pakistani brands of designer lawns in foreign markets, especially India, something they especially promoted in recent years.

TDAP has booked all six halls at the Karachi Expo Centre and 300 stalls have already been sold to local and foreign exhibitors. Its officials claim that they have sold all stalls without giving any concession to local exhibitors in order to attract only serious exhibitors to make the event successful.

They are expecting better response this year and have booked 500 rooms in five-star hotels in Karachi at a discounted rate of $100 a day, which is at least 50% less than the market rate.

The first two days of the exhibition will be open for foreign buyers only while the last two days will be for general public.

Published in The Express Tribune, October 2nd, 2012.

German retail sector weaker than expected

BERLIN: Retail sales in Germany rose slightly in August, but by less than expected, data showed Friday, adding to evidence that the Eurozone’s long-running debt crisis is affecting its biggest economy.

Sales were up 0.3 percent compared with the previous month, according to provisional figures released by the federal statistics office Destatis.

But analysts surveyed by Dow Jones Newswires had expected a stronger bounce of 0.6 percent on the month following the steep decline of 1.0 percent in July.

Colombia holds interest rate at 4.75 percent, as expected

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central-bank-of-colombia-mBOGOTA: Colombia’s central bank held its benchmark interest rate steady on Friday as expected after above forecast second quarter growth gave the authority room to pause rate cuts.

Faster growth in Latin America’s fourth-biggest economy led the bank to keep its overnight lending rate at 4.75 percent after two straight cuts to protect Colombia from a slide in overseas demand.

POL prices expected to increase next week

ISLAMABAD: The price of petroleum products is expected to increase next week following a rise in the per barrel price of crude oil in the international market.


The price of petroleum products are expected to increase by up to Rs7 per litre. According to sources, the per litre price of petrol and diesel could be increased by Rs5 while the price of HOBC may increase by Rs6-7.


The price of crude oil has rise by $10 per barrel in the international market and is currently being sold at $116.

Incoming funds: Huge Indian investment in Pakistan’s bourses expected

Law does not restri­ct portfo­lio invest­ment from India.  ” India’s stock market is expensive while Pakistan’s is fairly cheap,” MD of Emerging Economics Research Muzzamil Aslam. PHOTO: FILE.

KARACHI: 

Stock market analysts have shown optimism that huge portfolio investment from India to Pakistan will follow the recent easing of investment restrictions that have hindered the cross-border movement of capital for decades.


India allowed Pakistani citizens and companies incorporated in the country to make investments in India in all sectors other than defence, space and atomic energy in the beginning of August. This announcement was followed by the reduction of items in the sensitive trade list by almost one-third besides the grant of permission to Pakistanis to buy shares in Indian companies.


“There’s likely to be more inflow into, rather than outflow from, Pakistan with regard to the recent developments. India’s stock market is expensive while Pakistan’s is fairly cheap,” says Muzzamil Aslam, Managing Director of Emerging Economics Research.


“You can have an oil share in Pakistan at half the price you’ll pay in India,” adds Aslam, who served as chief economist at JS Global until recently.


There was no provision in Pakistan’s laws that specifically restricted portfolio investment from Indian citizens, he said. Just like any other national, Indians would also buy shares in the Pakistani market through their regular trading accounts in international brokerage houses, he added.


“But Indian brokerage companies are now likely to collaborate with their Pakistani counterparts in a way that global financial services’ firms, like JPMorgan and Morgan Stanley, do by joining hands with local brokerage firms to trade on the Pakistani stock market. This development has a strong symbolic value,” Aslam said.


The recent abolition of some investment restrictions is likely to result in Indian and Pakistani brokerage houses joining hands to promote stock trading in each other’s country, which is expected to increase portfolio investment across the borders.


News stories in the Pakistani media say that Pakistani and Indian brokerage houses have decided to set up representative offices in the two countries after the successful conclusion of the recent visit of a Pakistani parliamentary delegation to Delhi.


There was an outflow of private portfolio investment from Pakistan amounting to $71.1 million in 2011-12. In 2010-11, the net private portfolio investment was $344.5 million. Similarly, in the first month of fiscal 2012-13, portfolio investment stood at $28.8 million, which came from the United Kingdom, Hong Kong, Switzerland and Australia, among others.


However, the volume of private portfolio investment from India to Pakistan has traditionally been negligible.


While Pakistan exported goods worth $272 million to India in calendar year 2011 as opposed to the imports from India costing $1.6 billion in the same year, media reports have quoted members of Indian and Pakistani business communities as saying that the volume of illegal trade between the two countries is approximately $10 billion annually.


Aslam stated that the size of Pakistan’s stock market was relatively small. “Of the approximate market capitalisation of $40 billion, free float is just about 25%, which means $10 billion,” he said, referring to the shares that are available to investors for trading on the stock market.


“Out of the $10 billion, about $2 billion is already foreign-owned,” he noted, saying that even a considerably small inflow, which is between $300 and $400 million, will leave a huge impact on the prices of Pakistani stocks.


Published in The Express Tribune, August 31st, 2012.

Investment up to $2.7b expected in wind projects

Potent­ial to genera­te 3.2m MW from renewa­ble resour­ces identi­fied.  RENEWABLE ENERGY: 150,000 megawatts of energy can be generated through exploiting the wind energy resources in Pakistan, according to a USAID report. PHOTO: EXPRESS/FILE


KARACHI: The government expects an investment between $1.2 billion and $2.7 billion merely in the wind energy projects in the country; though many alternative energy projects are on the cards to attract foreign investment and bridge the power deficit.


According to official estimates, Pakistan has the potential to generate 143,000 megawatts (MW) through solar and wind energy. Currently, the country is developing wind power plants in Jhimpir, Gharo, Keti Bandar and Bin Qasim in Sindh which will not only reduce electricity shortages, but will also help ease the burden of oil imports costing over $12 billion annually to the national exchequer. The fair category of wind speed in most parts of the world is between 6.2 and 6.9 metres per second (m/s). However, the wind speed in the Sindh corridor is stronger and stands in the excellent category of 7.5m/s and 7.7m/s.


According to a United Stated Agency for International Development (USAID) report, Pakistan has the potential of producing approximately 150,000MW of energy through wind, of which only the Sindh corridor can produce 40,000MW.


Government plans to achieve up to 2500MW by end of year 2015 from wind energy.


Work on Zorlu energy wind power project with 50MW generation capacity is underway in Jhimpir and will start trial production soon. Pakistan’s Alternative Energy Development Board (AEDB) recently approved a New Park Energy Phase-I, 400MW wind project near Port Qasim.


According to a study, Pakistan has identified cumulative potential to generate 3.2 million MW from renewable energy resources – 340,000MW from wind, 2.9 million MW from solar, 50,000MW from hydro (large), 3,100MW from hydro (small), 1800MW from bagasses cogeneration and 500MW from waste.


Published in The Express Tribune, August 7th, 2012.