ADB to invest $2 billion in Pakistan’s energy sector

In this file photo, pedestrians walk past a logo of the Asian Development Bank (ADB) displayed outside its headquarters in Manila on Sept. 2, 2010. (AFP)
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Updated 12 December 2019

ADB to invest $2 billion in Pakistan’s energy sector

  • Pakistan’s energy sector is facing a cash shortfall of Rs12 billion per month, down from Rs39 billion
  • ADB is interested in facilitating technical studies for gas storage facilities

KARACHI: The Asian Development Bank (ADB) plans to invest $2 billion in Pakistan’s energy sector within the next three years, as the South Asian nation’s power supply chain is paralyzed by Rs12 billion a month in circular debt, the Ministry of Energy said in a statement.
After a Wednesday meeting with Energy Minister Omar Ayub Khan and Special Assistant to the Prime Minister on Petroleum Nadeem Babar, the ADB’s team, headed by its director for Central and West Asia, Werner Liepach, also expressed interest in facilitating technical studies for gas storage, as Pakistan is facing a gas deficit.
The Asian lender this week released $1 billion to shore up Pakistan’s public finances and help strengthen its slowing economy, while another $300 million were released to help the government address financial sustainability, governance, and energy infrastructure policy constraints in the energy sector.
In July, the International Monetary Fund (IMF) approved a three-year $6 billion extended fund facility (EFF) to finance the government’s economic reform program that aims to put Pakistan’s economy on the path of sustainable and inclusive growth. The bailout program is expected to catalyze at least $38 billion in financing from Pakistan’s development partners.
The ADB, Pakistan’s top energy sector partner with a $2.1 billion portfolio discussed energy sector projects with the ministry’s Power Division, and it was decided that a comprehensive portfolio review meeting will be held by the end of this month.
The ADB team was apprised of the New Renewable Energy Policy, which will be placed before Pakistan’s Council of Common Interest (CCI) in its scheduled meeting by the end of the month. The team was briefed on various steps that have been undertaken to boost the efficiency of the system and campaign against power theft, the ministry’s statement said, adding that the government’s circular debt capping plan has reduced the debt’s growth from Rs39 billion a month to Rs12 billion. 
On Dec. 6, Liepach observed that Pakistan’s “is a longstanding chronic issue ailing the country’s power sector.”
“A comprehensive and realistic Circular Debt Reduction Plan, assisted by ADB in close coordination with other development partners, is the cornerstone of this subprogram. The plan aims to drastically cut the new flows of circular debt and provides policy directions on addressing accumulated circular debt,” he said.

Fraud, corruption tackled during COVID-19: Saudi Central Bank

Updated 03 December 2020

Fraud, corruption tackled during COVID-19: Saudi Central Bank

  • Governor Ahmed Abdul Karim Al-Kholifey on the measures the Kingdom has taken to fight financial crime

RIYADH: The governor of the Saudi Central Bank on Wednesday revealed measures taken by the Kingdom to combat the “risks and threats” posed by financial crimes during the coronavirus pandemic. 

Speaking at the opening session of the 12th Annual Forum for Compliance and Combating Money Laundering, Ahmed Abdulkarim Al-Kholifey said that Saudi Arabia had acted on a number of cases of money laundering, corruption and financial fraud.

“You know about the extent of the impact of the outbreak of the COVID-19 pandemic on health, social, and economic aspects, including the impact on the economies of the entire world. Among the negative impacts that affected the countries of the world are the emergence of new risks and threats,” he told delegates.

Al-Kholifey, who is also chairman of the Anti-Money Laundering Permanent Committee, added: “Among the most prominent of those risks and threats that have been observed during the pandemic period are the increase in financial fraud cases, namely, emergence of individuals claiming to invest in digital currencies or claiming to provide investment services in some major companies.

“(There has also been an) increase in cybersecurity crimes such as hacking into individuals’ smart devices, obtaining their banking information, and exploiting the pandemic period to carry out fake financial donation campaigns for those affected by the coronavirus pandemic by announcing on social networks that they will collect donations for international aid organizations or provide aid to poor countries.”

During his forum address, he noted that his team had observed cases of corruption where officials had exploited support provided by the government to reduce the effects of the health crisis, and engaged in fake or exaggerated deals in an attempt to take advantage of the backing.

Al-Kholifey also pointed out that there had been “cases associated with fraud in medical supplies.” 

Dr. Ahmed bin Abdul Karim Al-Kholifey, Governor of the Saudi Central Bank (SAMA) and Chairman of the Anti-Money Laundering Permanent Committee. (Refinitiv)

To combat these issues, Saudi authorities, including the central bank, had introduced numerous procedures and measures to manage the risks, he said. This was done by adopting procedures and international standards for combating money laundering and terrorist financing that had been developed by the Financial Action Task Force (FATF) in Paris.

Despite the challenges posed by COVID-19, Saudi officials had managed to maintain communication with the private sector and encourage financial institutions to continue providing financial services, by enhancing electronic and digital payment options, Al-Kholifey added.

This year’s virtual conference was organized by the Anti-Money Laundering Permanent Committee in cooperation with the Saudi Central Bank and global financial solutions company Refinitiv.

David Craig, CEO of Refinitiv, spoke about Saudi Arabia’s leadership in fighting financial crime and the Kingdom’s critical role in the modern global financial system. He also noted that financial criminals were becoming more sophisticated in their tactics. 

David Craig, CEO, Refinitiv. (Refinitiv)

He said: “In the Middle East — as elsewhere — we are witnessing a major increase in identity-related fraud as organizations digitally onboard customers. Not surprisingly, this has become a significant focus of Refinitiv’s recent work and investments. 

“We’re seeing financial criminals move into human trafficking, wildlife smuggling, and other green crimes like the logging of pristine forest — all of which have devastating impacts on people, society, and the biodiversity of our planet. Financial crime is never a victimless crime,” Craig added.

Speaking at the same event, Ali Al-Qahtani, deputy chief compliance officer and head of financial crime compliance at the Saudi British Bank, said that criminal cyber activity had significantly increased around the globe.

“The collective campaign, led by the Saudi Central Bank, helped local banks address these emerging challenges. In line with the local regulations, we kicked off a high-level engagement and set up a crisis management committee. We also had effective planning in place to address staff safety and rolled out precautionary measures outlined by the Ministry of Health.

“Awareness is a key component in promoting a sound compliance culture and that is why I believe that ongoing communication is a necessity,” Al-Qahtani added.