DP World and CMA CGM form Chile container depot

DP World and CMA CGM have created a new company Chile Inland Services (CIS), a joint venture to operate a container depot and bonded storage facility 10 km from the Port of San Antonio.

In April, CIS began its first phase of operations, consisting of a five-hectare facility providing maintenance, repair, and specialized refrigeration services for maritime containers.

By the end of 2023, CIS services intend to expand to 11 hectares and include additional container storage space, a secure customs area for full container storage and a bonded warehouse for cargo consolidation and deconsolidation.

"We are pleased to officially open Chile Inland Services. This investment represents an important milestone for us as we continue to develop smart logistics solutions for our customers. Our goal is to develop integrated logistics services in key locations, making it easier for Chilean companies to move their goods through the Port of San Antonio," said Curtis Dorion, CEO of DP World Chile.

Efrain Osorio, General Manager of CMA CGM for Chile, Peru, and Bolivia said "Our strategic participation with DP World in CIS seeks to differentiate us in the market, raise the level of service by taking what we do at sea and in ports to specialized logistics services on land, and offer our customers a preferential service throughout the country. Chile continues to grow in exports and cargoes are becoming more and more sophisticated".

 

Arab League readmits Syria

The Arab League readmitted Syria on Sunday after more than a decade of suspension, consolidating a regional push to normalize ties with President Bashar al-Assad in a move criticized by Washington.

The decision said Syria could resume its participation in Arab League meetings immediately, while calling for a resolution of the crisis resulting from Syria's civil war, including the flight of refugees to neighbouring countries and drug smuggling across the region.

While Arab states including the United Arab Emirates have pressed to end Assad's isolation, some have been opposed to full normalization without a political solution to the Syrian conflict, seeking conditions for Syria's return.

Qatar, which had previously opposed Syria's return to the League, said its position on normalization had not changed and it hoped regional consensus on Syria could be a motive for the Syrian regime to address the roots of the crisis, a foreign ministry spokesperson told state news agency QNA.

"The reinstatement of Syria does not mean normalization of relations between Arab countries and Syria," Arab League Secretary-General Ahmed Aboul Gheit told reporters in Cairo. "This is a sovereign decision for each country to make."

Syria called on Arab states to show mutual respect.

A US State Department spokesperson said Washington shared the goals of Arab partners in Syria, including building security and stability, but remained skeptical of Assad's willingness to take the steps necessary to resolve Syria's crisis".

"We do not believe Syria merits readmission into the Arab League at this time," the spokesperson said, adding that US sanctions would remain in full effect.

But Russia, an Assad ally, hailed Syria's readmission.

"Moscow welcomes this long-awaited step, the logical result of the process, which has gained momentum, of returning Syria to the 'Arab family,'" Maria Zakharova, spokesperson for Russia's Foreign Ministry, said in a statement.

 

Saudi Crown Prince discusses regional stability with US, UAE and Indian officials

Saudi Crown Prince Mohammed bin Salman met with senior officials from the United States, United Arab Emirates and India on Sunday. In Jeddah, he received Ruler of Abu Dhabi and National Security Advisor of the United Arab Emirates (UAE) Sheikh Tahnoun bin Zayed Al Nahyan; the US National Security Advisor Jake Sullivan; and the National Security Advisor of India Ajit Doval.

During the meeting, they discussed ways to strengthen relations and ties between the three countries in a way that enhances growth and stability in the region.

Crown Prince and Prime Minister received on Sunday the US National Security Advisor Jake Sullivan in Jeddah

During the meeting, they reviewed the strategic relations between the two countries and ways to enhance them in various fields. They also discussed the latest regional and international developments.

Attending the meeting from the American side were US Ambassador to Saudi Arabia Michael Ratney; the US National Security Council Coordinator for the Middle East and North Africa Brett McGurk; Special Presidential Coordinator at the Department of State Amos Hochstein; and Senior National Security Advisor Ariana Berengaut. 

Pakistan Stock Exchange benchmark index posts 1.6%WoW increase

Market remained in green throughout the week ended on May 05, 2023 as buyback announcements from LUCK and HBL’s Sponsors boosted investor’s confidence.

The benchmark index gained 661 points during the week to close at 42,242, posting 1.6%WoW increase. Participation also witnessed an increase of 17.5%WoW as average daily trading volume rose to 244.5 million shares as compared to 208.0 million shares a week ago.

On the macro front, IMF reviews still hang in the balance and as the Fund will review the budget plans for upcoming year.

While political instability still persists, as deadlock remains on the election dates between PTI and the incumbent government.

Internationally, crude oil prices dropped during the week due to lower than anticipated demand from China and FED rate hike by 25bps. WTI/Brent declined by 8.0%/8.1%WoW to currently trade at US$70.6/74.7/bbl, respectively.

Foreign exchange reserves of Pakistan remained largely flat on a weekly basis to US$4.46 billion as of April 28, 2023.

PKR remained stable during the week to close at PkR283.59 to a US$, a gain of 0.1%WoW.

Other major news flows during the week included: 1) Trade deficit for first 10 months of FY 23 declined 39.62%YoY to US$23.71 billion, 2) Food pushes inflation was record at 36.4% in April, 3) FBR suffers shortfall of over PKR100 billion in April, 4) POL products sale in April declined 46%YoY to 1.17 tons, 5) April cement dispatches declined 16.55%YoY to 2.95 million tons, 6) Circular debt crossed PKR4 trillion mark.

Synthetic & Rayon, Woollen, and Leasing Companies were amongst the top performers, while Fertilizer, Property, and Refinery were amongst the worst performers.

Flow wise, major selling was recorded by Foreigners with a net sell of US$6.1 million. Individual absorbed most of the selling with a net buy of US$8.0 million.

Top performing scrips during the week were: PGLC, IBFL, PKGS, UPFL, and LUCK, while the laggards included: ENGRO, DAWH, PAKT, JVDC, and JDWS.

Going forwards, any positive development on the IMF front and political stability would further boost the investor’s confidence. However, market upside is expected to remain limited due to record high interest rates in the country and rampant inflation.

Analysts advise investors to take a cautious approach while building positions in the market and continue to advocate the stocks with dollar-denominated revenue streams (Technology and E&P sector), to hedge against the currency risks or companies with healthy forward dividend yields.

Pakistan: Markup payments exceed net revenue collection

Economic analysts have been warning about the adverse impacts of indiscriminate borrowing and persistent hike in the interest rate, in the name of containing inflation. However, economic managers never paid any attention to this.

Today, I am inclined to refer to a report by Topline Securities, one of the leading brokerage houses of Pakistan. According to the report total markup payments during 9MFY23 were up 69%YoY on the back of higher interest rates and increasing debt stock.

Budget Deficit of Pakistan for 9MFY23 has been reported at PKR3.08 trillion or 3.7% of GDP as against PKR2.56 trillion or 3.8% of GDP in 9MFY22. Budget Deficit for 3QFY23 was reported at PKR1.39 trillion as against a deficit of PKR1.19 trillion for 3QFY22. IMFs has projected budget deficit for the full year FY23 at 4.6%.

The government for 9MFY23 recorded a primary surplus of PKR0.5 trillion or 0.6% of GDP as against a primary deficit of PKR0.45 trillion in 9MFY22. For 3QFY23 primary deficit was posted at PKR0.39 trillion as against a primary deficit of PKR0.53 trillion for 3QFY22. IMFs had projected primary surplus for FY23 at 0.2% of GDP. 

Total Revenue collection for 9MFY23 has been reported at PKR6.94 trillion as against PKR5.88 trillion for 9MFY22, a growth by 18%YoY. Total expenditures increased by 19%YoY to PKR10 trillion for the period under review.

Federal Government Markup Payments for 9MFY23 have been reported at PKR3.58 trillion as against net revenue receipts of PKR3.44 trillion. Total Markup payments during 9MFY23 were up 69%YoY on the back of higher interest rates and increasing debt stock.

Indirect Taxes contributing 55% of FBR revenue were reported at PKR2.84 trillion while Direct Tax collection was PKR2.31 trillion.

 

Trade between Iran and Turkey reported at US$1.379 billion for Jan-Mar 2023 quarter

The value of trade between Iran and Turkey has been reported at US$1.379 billion during the first quarter of 2023, down 14% from US$1.619 billion in the first three months of 2022, according to the figures recently released by the Turkish Statistical Institute.

Turkey’s export to Iran rose 2% to US$702 million in the three-month period of this year, from $682 million in the same period of the previous year.

Iran’s three-month export to Turkey declined 27% to US$677 million from US$932 million.

Based on the data released by the Turkish Statistical Institute the value of Iran’s exports to Turkey increased by 19% to US$3.35 billion in 2022.

Turkey had imported over US$2.82 billion worth of commodities from the Islamic Republic in 2021.

Based on the mentioned data, Iran’s imports from the country also marked an 11% rise to US$3.07 billion in the past year, in comparison with 2021, when the figure was US$2.77 billion.

Trade between the two countries has registered a 15-percent rise in 2022.

The value of trade between the two neighbors reached US$6.42 billion in 2022, while the figure stood at US$5.59 billion in the preceding year.

Iran's trade balance with Turkey has been US$280 million positive in favor of Iran in the past year.

As announced by an official with Iran’s Trade Promotion Organization (TPO), the value of Iran’s export to Turkey increased by 23% in the past Iranian calendar year 1401.

Farzad Piltan, the director-general of TPO's Office of West Asian Countries, said that based on the data released by the Islamic Republic of Iran Customs Administration (IRICA), Iran exported commodities worth $7.45 billion to its neighbor in 1401, while the figure was $6.079 in 1400.

Saying that Turkey was Iran’s third top export destination in the past year, the official named natural gas, aluminum, urea, polyethylene, copper cathode and cathode parts, copper wires, iron and steel ingots, and polyethylene as the major products Iran exported to Turkey in the previous year.

Piltan further announced that Iran’s import from Turkey also rose 15 percent to about $6 billion in 1401, from $5.2 billion in 1400.

Stating that Turkey was the third source of import for Iran in the previous year, the official named sunflower seed oil, road tractors, corn, bananas, generators, barley, soybeans, synthetic fibers, crude soybean oil, and solid acrylic polymers as the main items Iran imported from its neighbor in 1401.

In last July, Iran and Turkey discussed ways of expanding economic relations along with political ties at the Turkish-Iranian High-Level Cooperation Council in Tehran.

During the meeting, which was co-chaired by Iranian President Ebrahim Raisi and Turkish President Recep Tayyip Erdogan, the two sides negotiated the extension of the gas export contract between the two sides for the next 25 years.

In the meeting, President Raisi noted that the Islamic Republic of Iran is determined to expand economic relations with neighboring countries.

The president also evaluated Tehran-Ankara ties as positive and progressive, saying that the two countries should pursue appropriate policies to move towards increasing their annual trade exchanges to $30 billion.

On the sidelines of the mentioned meeting, Iranian Energy Minister Ali-Akbar Mehrabian also held talks with Turkish Minister of Energy and Natural Resources Fatih Dönmez in which the two sides exchanged views on cooperation in energy fields.

Later on, Head of Turkey’s Small and Medium Enterprises Development Organization (KOSGEB) Hasan Basri Kurt met with Head of Iran Small Industries and Industrial Parks Organization (ISIPO) Ali Rasoulian to discuss ways of expanding cooperation between the small and medium-sized enterprises (SMEs) of the two countries.

In this meeting Rasoulian referred to the signing of a memorandum of understanding (MOU) between the two countries on cooperation between SMEs, saying: “President Raisi has emphasized setting up joint industrial parks in the country’s special economic zones, considering the good infrastructure for setting up such parks in the free and special economic zones and the active presence of economic enterprises in these areas.”

 

Jeddah talks could end Sudan conflict

Foreign Minister Prince Faisal Bin Farhan hoped that talks being held in Jeddah between the Sudanese warring parties will lead to an end to the conflict.

The Sudanese Armed Forces (SAF) and the Rapid Support Forces (RSF) started direct talks on Saturday in Jeddah, Saudi Arabia and the US announced in a joint statement.

Prince Faisal welcomed the presence of representatives of the Sudanese Armed Forces and the Rapid Support Forces in Jeddah to engage in dialogue.

“We hope that this dialogue will lead to the end of the conflict and the return of security and stability to Sudan.”

“This dialogue comes as a result of international collaboration and vigorous efforts of the Kingdom with the United States and in partnership with the Quartet countries and partners from the tripartite mechanism,” said minister.

Riyadh and Washington urged both parties to actively engage in talks toward a cease-fire and an end to the conflict.

They also urged continued, coordinated international support for an expanded negotiation process that should include engagement with all Sudanese parties.

US Secretary of State Anthony Blinken thanked Saudi Arabia for hosting the talks. He urged the parties to engage in these talks seriously as a path toward ending the conflict.

Fighting between two rival generals — army chief Gen. Abdel Fattah Al-Burhan and RSF commander Gen. Mohammed Hamdan "Hemedti" Daglo — broke out April 15, leaving more than 550 people dead.

RSF commander welcomed on Saturday the joint statement by Saudi Arabia and the United States, initiating talks between the conflicting parties in Jeddah.

He appreciated all regional and international efforts to establish a ceasefire, open humanitarian corridors, and provide essential services to the people of Sudan.

“We are committed to democracy and the transition to a civilian-led government,” he said.

Daglo expressed his gratitude to Saudi Arabia and the United States for sponsoring this initiative, and extended a special thanks to the Saudi leadership for hosting the talks.