Transcript GROWTH IN FEDERAL GOVERNMENT REVENUE

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THE ECONOMY OF PAKISTAN
- Some Thoughts
Presentation by:
PROF. DR. KHAWAJA AMJAD SAEED
Principal
HAILEY COLLEGE OF BANKING & FINANCE
University of the Punjab, Lahore.
Email: [email protected]
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WELCOME
TO OUR
PROGRAM
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PRESENTATION
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Overall Framework PEST Formula
Constitution of Pakistan
Global Tributes to Pakistan
GDP
Federal Budget 2006-07
Growth in Federal Government Revenue
Corporate Income Tax Rates
Energy
China Factor
Pakistan-Economy Final Review
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1: OVERALL FRAMEWORK
P
E
S
T
Political
Economic
Sociological
Technological
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2: CONSTITUTION OF PAKISTAN
Article
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Focus
Elimination of Exploitation
Freedom of Trade, Business
or Profession
Promotion of Social Justice
and Eradication of Social
Justice
Promotion of Social and
Economic Well-being of the
People
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3: GLOBAL TRIBUTES TO PAKISTAN
1:
World Bank - Managing Director
October 2006
1. Rich in Human Capital
2. Impressive Record
- Growth
- Development
- Poverty Alleviation
3. Continuous Economic Reforms
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4. Inflation-Down
5. Government: 5-10 Years Plans
- Water
- Energy
- Food Security
- Infrastructure
- HRD
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6. Privatization Program
7. Gawadar-Corridor
- Trade
- Transportation
- Energy
- Central Asia & China.
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2: IMF-September 2006
Tributes
1. Excellent Medium Term Planning
2. Strong FDI
3. Growing Domestic Investment
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3: Economic Freedom Index 2006
Pakistan
110 better than India
India
121
4: Opacity Index
Economist London Pakistan rated higher
than India
5: Moody’s Investors Service-2006
Pakistan’s Rating Improving
B2 to B1
Foreign and Local Currency Bonds
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4: GDP
Pakistan
Average Four Years
2005-06
Others
World
Euro
USA
Japan
Germany
7.0%
6.6%
4.8%
1.3%
3.5%
2.7%
0.9%
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China
Asian South Asian
- India
- Pakistan
- Sri Lanka
- Bangladesh
9.9%
5.0%
8.0%
6.6%
5.9%
5.8%
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5: FEDERAL BUDGET 2006-07
Outstanding Features
1. Record ADP Rs 435b
2. Record Allocation to Provinces:
Revenue Budget Rs 378b
ADP Allocation Rs 115b
3. Record forecast for Rs 1,083b
Current Revenue
4. Special Allocations ADP
Programs Rs 34b
Areas Rs 17b
ERRA Rs 50b
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6: GROWTH IN FEDERAL
GOVERNMENT REVENUE
Year
Rs b
% Growth Index
2005-06
-05
-04
-03
-02
-01
1999-00
1,096
900
791
721
624
553
513
214
175
154
141
122
108
100
Source: Excerpted from Pakistan Economic Survey
2005-06, Statistical Appendix, Table 4.3.
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7: CORPORATE INCOME TAX RATES
Year
Public Company
%
2004
2005
2006
2007
35
35
35
35
Private Company Bank
%
%
41
39
37
35
44
41
38
35
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8: ENERGY
A: Needed
1. Cheap
2. Abundant
3. Environmental Friendly
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B: Electricity Use
1. Households
2. Industry
3. Agriculture
4. Commerce
5. Others
%
43
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83
07
10
100
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C: Energy Perspective
Short Term
2007
Medium Term
2008-2010 45 Power Plants
Long Term
31 Projects (Hydel & Nuclear)
MW
1,000
8,600
19,150
28,750
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Impact
Job Creation
- Direct
- Indirect
08 Lac
16 Lac
24 Lac
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D: Installed Generation of Electricity
Capacity
%
1. Wapda
(Hydel 58% + Thermal 42%) 58
2. IPPs
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3. KESC
09
4. Nuclear
83
100
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E: Issues
MW
1. Untapped Hydel Potential
50,000
2. Line Losses
3. Solar Energy
4. Wind Energy
5. Austerity/Consumption Planning
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9: CHINA FACTOR
1. Population
Currency
1.3b
Renminbi (Yaun)
2. Language
Mandrin
3. World Ranking & other Economic Data
Exports
4th
GNP
6th
Per Capita
$960
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3. World Ranking & other Economic Data
Inflation
0.8%
Unemployment
2%
4. Strengths
1. High Domestic Market
2. Food Self Sufficiency
3. Mineral Resources
4. Diversified Industrial Sector
5. Low Wages
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6.
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Rapid Sustained Growth
Growing Exports
Hong Kong as a Financial Sector
Heavy Investment in Communication
and in IT Sectors
5. Weaknesses
1. Corruption
2. Underemployment
3. Geographical Disparities
4. Poor transportation
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Export-Destination
1. USA
2. HK
3. Japan
4. Taiwan
5. South Korea
6. Germany
7. Others
Total
%
22
18
18
13
10
06
13
100
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6. Contributions to Pakistan
1. Karakrum Highway
2. Heavy Mechanical Complex
3. Chasma Nuclear Plant
4. Gawader
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7. Upcoming Investment
1. Five years Linkage
2. Private Sector Industrial
Estate in Punjab
- Gawader
Refinery
Other Investment
- 32 Point joint statement
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10: PAKISTAN-ECONOMY FINAL
REVIEW
Positive
1. GDP Growth
2. KSE
3. FDI
4. Consumer Credit from
5. Poverty Alleviation
Levels
7%
Bullish
Robust
Growing
10% down
since 2000
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Negative
1. Income Distribution
2. Trade Gap
3. Growth
Skewed
Widening
Non
Sustainable
Source: Edited from IBP Newsletter, November 2006.
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THANK YOU
FOR
JOINING US
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