TOTAL FOREIGN INVESTMENT DURING FIRST HALF OF FY 2006-07 EXCEEDS US $ 3.3 BILLION- Zahid Hamid

Islamabad, January 23, 2007

Pakistan is heading for new records for total Foreign Investment this year, which has already exceeded to US $ 3.3 billion during the first half of the current Financial Year. Mr. Zahid Hamid Federal Minister for Privatisation & Investment and Chairman, Privatisation Commission stated this while addressing the Privatisation Commission Board meeting here today.

The Minister informed the Privatisation Commission Board that Foreign Investment figures continued to reach record levels during the current financial year. FDI during the first half July-December 2006 was US $ 1.87 billion, which is 69 % higher than the amount during the corresponding period last year. Portfolio investment in this period was US $ 627 million while GDR receipts of MCB and OGDCL are US $ 150 million and US $ 731 million respectively. Hence total Foreign Investment during the first half of FY 2006-07 exceeded US $ 3.3 billion, he said.

The PC Board reviewed the progress regarding privatisation of Pakistan State Oil Company Limited (“PSO”) through sale of 51% shares along with management control. The PC Board expressed satisfaction regarding the encouraging response from reputable local and foreign investors to the PC notice inviting fresh EOIs, which was an indication of their appreciation of the country’s economic performance and confidence in the privatisation and investment policies of the government.

The Board constituted a six-member Transaction Committee to supervise various stages of the process including pre-qualification of parties to enable them to enter into the data room for necessary due diligence. The Committee will make every effort to expedite the process so as to bring the transaction to the bidding point as soon as possible.

The PC Board noted with appreciation that the domestic retail offering of OGDCL have been oversubscribed by 38 % following the successful GDR offering last month. The Board reviewed the progress on transactions relating to IPO of HBL and GDRs of UBL, NBP, KAPCO and HBL and gave necessary directions to expedite the same.

The Jamshoro Power Company transaction was also discussed in depth and it was decided to expeditiously resolve all pending matters so as to bring it to the bidding stage.

The PC Board was in formed that the PC has received ten (10) Expressions of Interest (EoI) and Statements of Qualification (SOQ) from the interested parties to participate in the privatisation process of Heavy Electrical Complex (HEC), while eight (8) Expressions of Interest and Statements of Qualifications have been received in respect of Hazara Phosphate Fertilizers Ltd (HPFL). The Board was also apprised that process has been initiated for the privatisation of Pakistan Mineral Development Corporation’s (PMDC) Coal and Salt mines by inviting Expression of Interest (EOI) for appointment of Financial Advisor.

The PC Board also discussed the work of the ‘Future Portfolio Committee’ constituted to formulate recommendations for processing new transactions from the approved list of the Council of Common Interests (CCI).

The PC Board members and the senior representatives of the respective Ministries and departments were present during the meeting.