- Dar says new integrated capital market would be well received internationally, says Pakistan would soon be regarded as an emerging capital market
A formal memorandum of understanding (MoU) was signed Thursday in the presence of Finance Minister Ishaq Dar to merge the stock markets of Karachi, Lahore and Islamabad into a single entity by the name of ‘Pakistan Stock Exchange’.
Finance Minister Ishaq Dar on the occasion said the new integrated capital market would be well received internationally, adding that soon Pakistan would be regarded as an emerging capital market.
Dar said Pakistan’s economy was growing on the back of the government’s hard work and comprehensive economic policies.
“Financial and oil experts have predicted that Pakistan would be the 18th most stable economy of the world by the year 2018; but the government wants to attain this aim in half the time,” said the finance minister.
Dar said the government’s primary goal after coming into power was to avert the threat of default, and to strengthen the national economy.
On Tuesday, a meeting was held at the Securities and Exchange Commission of Pakistan (SECP) to discuss the way forward for the country’s capital market in view of the global trend towards consolidation and integration of stock exchanges.
The integration is expected to help reduce market fragmentation and create a strong case for attracting strategic partnerships necessary for providing technological expertise and assistance.
Ishaq Dar termed the scheme of integration a win-win situation for all the stakeholders and a landmark achievement which would go a long way towards sustainable development of capital market of the country.
He appreciated the SECP and assured full support of the government to achieve divestment of shares of public sector enterprises to get the full benefits of the exercise. The government, he said, was determined to promote standards and quality for the corporate sector and capital market in collaboration with the SECP adding that the government was also working to implement a robust reforms agenda with focus on strengthening good governance practices.
Ishaq Dar also lauded the SECP for getting Pakistan’s index reclassified in upcoming annual market classification review of MSCI and pushed the SECP for reclassification of Pakistan’s capital market as MSCI emerging market.
The minister also reaffirmed the government’s resolve to build forex reserves by $21 billion by the end of current calendar year besides narrowing the gap between income and expenditure of the government.
Dar said that fight against terrorism and extremism was heading towards success and expressed the hope that soon the country would become a peaceful and prosperous country.
The minister said that after achieving the macro-economic stability, the government was focusing on growth and set a target to get 7 percent GDP growth rate during next two years.
For achieving higher growth rate, the government has initiated work on the development of mega energy generation projects to generate about 24,000 MW electricity.
He said about 10,000 MW electricity would be added to the national grid by the end of December, 2017, which would help in GDP growth and economic uplift of the country.
About the recent fluctuation in international capital market, the minister said it was temporary and local economy had strengthened with strong fundamentals the ability to absorb these shocks. He called for avoiding the speculations and panic as it was a routine exercise in capital market and would soon be settled.
Speaking on the occasion, SECP Chairman Zafar Hijazi said that the SECP had achieved successes including de-mutualization and legislation and played a key role to make the capital market of the country as hub of foreign investment.
He informed that the integration process was not a new as many developed economies like Hong Kong, Singapore and Malaysia have one capital market and recently India has also merged its 23 stock exchanges into single stock exchange.