Federal Finance Minister Senator Ishaq Dar Friday announced that the government would present the Companies Ordinance 2016 in the joint session of the parliament for its approval. He also announced that the government will introduce CPEC Infrastructure Development Fund through bonds that would be listed and traded through Pakistan Stock Exchange.
He was speaking at the signing ceremony of Share Purchase Agreement between Pakistan Stock Exchange (PSX) and Chinese Consortium here on Friday. The Chinese Consortium signed a Share Purchase Agreement for the acquisition of 40 percent strategic stake in Pakistan Stock Exchange.
The minister said ''a few people'' are opposing this law because it demands companies disclose their assets outside Pakistan. "We know who are behind the motivation to oppose this law in the Senate, but we are determined to get it approved from a joint session of the parliament," he said.
He said the Companies Ordinance 2016 is updated and very good law. He invited good suggestions from all people including opposition to make the law more effective. He said the government doesn''t want to punish anyone. Ishaq Dar said that after signing of Share Purchase Agreement with Chinese Consortium, PSX has become a regional capital market that is expected to attract more foreign investors and funds. He said the Chinese have rich experience, expertise and best corporate practices that will further increase performance of PSX.
He said PML (N) government has achieved most of the macroeconomic targets. The country''s forex reserves have increased to $24 billion, inflation has decreased to the lowest level while fiscal deficit has reduced significantly. He said the government paid its attention to increase power generation in the country and hopefully there would be no load shedding in the country in 2018. He said some people were predicting that Pakistan would default by June 2014. Now, after just four years, Pakistan is a stable and growing economy.
Governor State Bank of Pakistan Ashraf Wathra said collaboration is necessary for growth. He said no economy can grow in isolation. He said more competitive and profitable products would invite productive investment from domestic as well as global investors enabling country''s corporate and industrial sector to grow to its potential.
Chairman Securities & Exchange Commission of Pakistan (SECP) Zafar ul Haq Hijazi said PSX had entered into a strategic partnership with renowned global and local investors. Not only will deal bring about an ideal partnership for the development of capital market, it will also be another step in fostering economic development in the region.
He said it is expected that this partnership will be crucial in transforming the governance and regulatory structure of the exchange at par with global standards. The investors will bring improved governance, state of the art technology, managerial experience, investor base and listing and product development opportunities, thereby increasing visibility and improving marketability of PSX. This is especially crucial given the fact that presently Pakistan does not have an active futures or derivatives market and needs to capitalise on opportunities for market outreach, growth and expansion. It is expected that the foreign investors ensure a commercially-driven strategy for development of PSX while the local financial institutions will benefit from their knowledge of the local market and contribute towards enhancing market outreach.
Chinese Ambassador Sun Weidong said the strategic partnership between PSX and Chinese consortium would be another step towards all-round economic co-ordination between China and Pakistan.
He said that new products and co-ordinated expertise will support a reformed market and provide more financial support for enterprises. Munir Kamal, Chairman PSX, said that Pakistan stock market has been transformed from national to regional market. He sought the guidance of the government for CPEC-related trading at the stock exchange.
Arif Habib, Chairman of Arif Habib Group, said that Consortium has acquired the stakes of PSX through competitive bidding. He stressed the need for more listing at the exchange to enhance the market capitalisation. Hu Zheng, CEO, China Financial Future Exchange, said that due to the importance of the deal the Chinese government gave its approval. "With the Silk Route it is the beginning of the new era of deepening economic relations," he added.
Chairman PSX Divestment Committee Shahzad Chamdia said that the Chinese consortium had acquired 30 percent stakes in PSX while Habib Bank and Pak-China Investment Company acquired 5.0 percent each. He said the remaining 20 percent shares of PSX would be offered to general public through initial public offering.
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