PNB April 2023 in Review
Pakistan Agriculture Research (PAR)
An agri-tech firm focused on providing agriculture information services to enhance decision making.
This is a review of the major news trends across the month of April. Continue reading to stay on par!
COMMODITIES - CROPS, LIVESTOCK & HORTICULTURE
Despite the government proclaiming a bumper crop for wheat, Pakistan is currently facing a wheat crisis, with shortages, high prices, and procurement challenges. The Punjab Food Department has launched the wheat buying campaign for 2023, while the Sindh provincial government is struggling to meet its wheat procurement target of 1.44 million tonnes. The price of wheat flour has reached a record high of Rs 6300 per 40kg in Mansehra. To address this crisis, the Punjab government has set up 40 procurement centers to facilitate farmers.
On April 10th, the Sindh government banned the purchase of wheat from the open market and confiscated wheat purchased causing consumers to protest against the government's free flour distribution scheme. Meanwhile, wheat growers in South Punjab are reporting a higher-than-expected output despite weather-related challenges such as lodging and rains.?
In late April 2023, the government continued its crackdown against hoarding and smuggling of wheat, sugar, and urea. Law enforcement agencies seized thousands of metric tonnes of wheat and sugar, with fines imposed. The Federal Board of Revenue also designated specific border areas adjacent to Afghanistan, India, and Iran as designated areas to prevent smuggling.
The Punjab Food Department increased its wheat procurement target to 4.2 million tonnes due to a larger-than-expected crop yield. The Punjab government fixed the support price of wheat at Rs 3,900 per maund. In late April, the Punjab Food Department stopped releasing wheat quota from its godowns, resulting in an increase in the price of flour, and flour millers accused the Punjab government of unannounced restrictions on wheat procurement. Additionally, Pakistan's Customs authorities seized hundreds of metric tonnes of essential commodities, including sugar, flour, and fertilizers worth Rs 80m during several operations to prevent smuggling, and DCs across Sindh were directed to take legal action against hoarding and smuggling of commodities to Afghanistan.?
Finally, the Naanbai Association announced a strike in Rawalpindi and Islamabad, and officials predict a wheat flour shortfall until fresh wheat is acquired. The crisis remains a significant challenge for the government, which continues to take action to address the issue through various measures, including increased procurement targets, crackdowns on smuggling and hoarding, and facilitating farmers with procurement centers and gunny bags.?
Pindi-Islamabad citizens managed to reduce the prices of various fruits by 100% in early April, following a successful boycott campaign against exorbitant prices. Pakistan’s inflation crisis continued to worsen, with consumer inflation reaching a record high of 35.4% in March. This has had devastating consequences for the country's poor, with at least 20 people killed in crowd crushes at distribution centers during Ramadan. The inflation rate hit 35.37% during early April, leading to shortages of affordable groceries across the country. The situation was exacerbated by the absence of functional price control committees and more taxes in line with IMF preconditions.?
The World Bank reported that food prices in Pakistan have been increasing for 11 consecutive months, with consumer price inflation for food items reaching 47.2% in March, eroding the purchasing power of households by as much as 38%. Inflation dampened the spirit of Eid celebrations, with the Eid economy projected to have shrunk by around 40% in 2023, the lowest in a decade. According to data released by the Pakistan Bureau of Statistics, short-term inflation as measured by the Sensitive Price Index (SPI) increased to 44.61% year-on-year for the week ended April 13. On April 19, short-term inflation based on the SPI reached an unprecedented 47.23% year-on-year for the combined income group. Inflation has been steadily rising since August 2021, driven by factors such as a record rupee devaluation, high petrol prices, an increase in sales tax, higher electricity charges, and higher transportation costs.
Gold and silver prices in Pakistan soared to record highs in April. On April 5th, gold hit a historic high of Rs 214,500 per tola, surpassing the previous record set in January 2023. The next day, spot gold briefly touched $2,031.89 per ounce, reaching its highest level in a year, while US gold futures fell slightly. On April 11th, gold prices surged again, with an increase of Rs 3,100 per tola, reaching Rs 217,700 per tola, and silver rates touching a lifetime high of Rs 2,480 per tola. On April 12th, gold and silver prices hit all-time highs, with gold reaching Rs 218,300 per tola and silver rising to Rs 2520 per tola. By April 17th, gold prices reached another record high, with 10-gram gold and tola gold both hitting new highs. However, on the same day, gold prices fell sharply due to the dollar's increase and a Federal Reserve official's comments on the need for another interest rate hike. Nonetheless, by April 19th, gold prices bounced back above $2,000 per ounce, with spot gold gaining 0.7%, as investors speculated on whether the US Federal Reserve would stop hiking interest rates after May's meeting.
Pakistan saw a steady increase in sugar prices over the past month. The retail market witnessed a Rs 20 per kg surge, while the wholesale market jumped from Rs 4,500 to Rs 5,600 per 50-kg bag, with prices increasing by Rs 100-200 per bag every week. On April 1, 2023, Federal Minister Naveed Qamar, addressed concerns about a sugar shortage in the country. He dismissed the reports, stating that there were ample surplus stocks available, revealing that private sectors imported 5,827 metric tons of sugar worth $4.750 million between April 2022 and January 2023.
To combat sugar smuggling, Caretaker CM Punjab, Mohsin Naqvi, called for a meeting on April 10, 2023, to review a proposal to enforce an Inventory Management System in sugar mills. The meeting decided to monitor sugar transportation at exit routes to prevent smuggling. On April 15, 2023, Prime Minister Shehbaz Sharif ordered a major crackdown on these stop sugar smuggling, hoarding, and profiteering. During an ordered crackdown against the sugar mafia in the Hazar Ganji area of Quetta, Customs Intelligence seized 2,550 parcels of sugar, 128 metric tons of sugar, and 200 tires on April 20, 2023, most probably being readied for smuggling to Afghanistan.
The government set the retail price of sugar at Rs 98.82/kg in response to the recent 30% surge in retail sugar prices on the 25th of April. This surge in domestic retail prices was triggered by the export of 172,180 tonnes of sugar in February-March 2023, compared to zero foreign sales in the same period last year, as well as rising international sugar prices.?
Pakistan's cotton industry has seen a sharp decline in production levels. On April 4th, the Pakistan Cotton Ginners Association reported that cotton production had decreased by 34% to 4.91 million bales, the lowest level in 40 years. The textile industry, which requires 15 million bales annually, will need to import around 10 million bales to meet its needs. Experts have attributed this decline to the climate crisis, which has caused unexpected rains, excessive heat, and dry weather, leading to a reduction in harvest quantity and quality. Cotton production has almost halved in the past decade, from 13.6 million bales in 2011 to around 7 million in 2021. Cotton Imports have also been halted due to the unavailability to open Letters of Credit due to depleting exchange reserves.?
Moreover, there are concerns about cotton sowing, with policymakers delaying setting targets until May 1, 2023, due to higher prices, a slow thinking process, and competing crops. Farmers have still shown a growing interest in cotton planting, and early sowing had already been completed on 0.4 million acres by the 13th of April, where experts have advised using approved varieties of cotton seed to avoid losses. The government has announced a support price of Rs. 8,500 per 40 kg and subsidies for cotton seed to encourage cultivation. By April 26th, the situation remained largely uncertain, with no target set for cotton sowing, and competing crops gradually pushing cotton out. The 2023-24 season presents a dismal picture for cotton and the textile sector.
In March 2023, Pakistan's cement sales dropped by 24.19% due to a decline in construction activities resulting from political instability, but exports of cement increased significantly after a long break. The industry witnessed a 48.46% increase in exports during the same period. Meanwhile, the country's merchandise exports fell by 14.76% year-on-year to $2.36 billion in March, marking the seventh consecutive month of decline. For the first nine months of the current fiscal year, from July to March, exports totaled $21.04 billion, down 9.87% from the same period in the previous year, fueling fears of job losses in the export sector.?
Despite this, some products have seen positive growth in exports, including spices, meat, fish, and men's garments, which saw an increase of 16.47%, 59%, 107%, and 36%, respectively. On the other hand, cotton yarn exports fell by 34%, while textile group exports decreased by 12.4%, with cotton yarn exports showing negative growth of 36.92% and rice exports declining by 10.79%. However, despite the damage to the last crop due to floods and heavy rains, Basmati rice exports from Pakistan surged by 45% in March from February, and the country is expected to cross the $2 billion export target.?
Monthly imports of various goods in Pakistan have shown fluctuations recently. In February 2023, the import value of raw cotton was Rs 36.8 billion, up 63.75% from the same period last year. Similarly, gold imports amounted to Rs 662 million, up by 79%. However, scarcity of imported unstitched fabric has hit the markets due to poor economic conditions, rising inflation, and ongoing crackdown on smuggled fabrics by the Customs Department. On April 10th, the import value of spices was reported at Rs 3.14 billion, up 1.2% compared to February 2022. Synthetic fiber imports have declined by 17%, amounting to Rs 7.47 billion in February 2023.?
Wheat imports in February 2023 were reported at Rs 26.9 billion, up 22.7% compared to the same period last year, according to PBS. However, power-generating machinery imports decreased by 37.4%, amounting to Rs 10.4 billion in February 2023. Pakistan's cotton imports for the fiscal year 2022-23 are set to be the lowest in three years, with a decline of 18% and 10% in cotton yarn and cotton cloth production, respectively. Petroleum imports have decreased by 20% during the current fiscal year. Finally, on April 27th, it was reported that spice imports in the first eight months of FY’23 amounted to Rs 23.9 billion, down by 11% compared to the same period last fiscal year.
AGRI-INPUTS, WEATHER, WATER & POWER
In recent weeks, Pakistan's National Electric Power Regulatory Authority (NEPRA) has been making several decisions regarding electricity tariffs across the country. On April 3rd, NEPRA approved a surcharge of Rs 3.23 per unit for all consumer categories, except for protected domestic consumers. The surcharge was intended to pay off markup on Power Holding Limited loans and clear circular debt in line with an agreement with the International Monetary Fund.
NEPRA also approved the recovery of Rs 20 billion from Karachi Electric (KE) consumers in 3 months through 2 quarterly tariff adjustments. This was due to the government reducing its subsidy. However, NEPRA reserved its decision on the government's request to increase the electricity tariff for Karachi consumers by Rs 6 per unit after conducting a public hearing.
On April 13th, NEPRA approved an increase of 47 paisa per unit in tariffs for DISCOs, allowing the recovery of an additional amount of Rs 15.454 billion from consumers during the second quarter of the current fiscal year. On April 26th, K-Electric requested approval from NEPRA to charge an additional Rs 6.636 billion consumers at the rate of Rs 4.49 per unit for electricity used in March.
It is expected that power distribution companies in Pakistan will increase electricity tariff by Rs 1.17 per unit after a petition was filed by the Central Power Purchasing Agency Guarantee Limited seeking fuel cost adjustment for March 2023. As a result of these decisions, electricity tariffs have been changing frequently, affecting many consumers in Pakistan as the summer onset nears.
The government announced that they would maintain the prices of petrol and high-speed diesel for the first half of April 2023. Meanwhile, kerosene oil and light diesel oil prices were reduced by Rs 10 per liter for the same period. This decision came after the Oil Marketing Companies (OMCs) estimated a significant reduction in ex-depot fuel prices of up to Rs 14 per liter. Pak-Arab Refinery Limited (PARCO), is facing a shutdown due to the historic level of diesel stocks in Pakistan, causing domestic demand for diesel and petrol to drop to half. This is due to historic levels of diesel stockpiles caused by the smuggling of Iranian oil flooding the market. The declining demand for diesel and petrol has dropped to half, leading to revenue losses for the country.
Interestingly, Pakistan's own diesel reserves are skyrocketing due to the country's reliance on Iranian diesel, which is around 60-70 PKR cheaper per liter compared to Pakistani diesel. The Iranian diesel is smuggled through speed boats operating in the ocean and Balochistan's Dasht River, leading to a massive influx of diesel in the country.
It was expected that petrol and high-speed diesel prices would increase in the second half of April 2023. Petrol prices were predicted to rise by Rs 15 per liter, while high-speed diesel may see a modest hike of 30 paisa. However, as of now, the prices have remained unchanged. Starting from May 1, 2023, the price of high-speed diesel is expected to decrease by Rs 5.41 per liter due to the decrease in global oil prices. This is expected to benefit farmers who rely on diesel for their farming activities, while the Pakistani government's attempt to reduce fuel prices for motorbikes and small cars met opposition from petroleum dealers, who fear they won't receive reimbursement on time.?
Additionally, the price of Liquefied Petroleum Gas (LPG) has increased sharply by Rs 10, with the official price at Rs 229 per kg, but sold in all major cities of the country at Rs 310 per kg. The Oil and Gas Regulatory Authority (OGRA) has recommended that Pakistan avoid importing Iranian LPG due to the risk of drawing sanctions from the US and Western countries. They have also found the quality of Iranian LPG to be substandard, and the transfer facilities at Taftan to be hazardous, posing a serious risk of explosion during transfer.
Having successfully finalized a crude oil deal with Russia, Pakistan is to receive its first shipment of discounted Russian crude oil in May. The move is aimed at easing Pakistan's economic woes and is expected to help the country avert a balance of payments crisis as it awaits an IMF deal. The single oil cargo sent by Russia on April 4, 2023, was seen as a test case to build trust between the two countries. The two countries had also been in talks to finalize the details of the agreement, including the mode of payment. The purchase of crude oil is expected to reach 100,000 barrels per day if the first transaction goes smoothly, with Russia agreeing to receive payment in three currencies. On April 27, 2023, the US stated that Pakistan's decision to purchase Russian crude oil is a "sovereign" choice.?????????
The Met Office said heavy rainfall and thunderstorms were expected to hit various areas including Kashmir, Gilgit-Baltistan, Peshawar, Islamabad, and Lahore, from 3-4 April. While recent heavy rains caused a heavy landslide in the Mount Sulaiman range, leading to the suspension of traffic on the Balochistan-Khyber Pakhtunkhwa highway. On April 13, the National Disaster Management Authority warned of a 72% chance of devastating floods this year due to temperature increase, glacier melting, and early monsoon. However, Pakistan's chief meteorologist reassured the public that normal rainfall was expected between July and August 2023.?
Heavy rains on the 19th of April caused floods and landslides, leading to the suspension of traffic on the Karakoram Highway and the deaths of transporters. On April 27, the Met Department and Sindh Provincial Minister for Environment warned of strong rains and thunderstorms from April 30 to May 5 in various cities of Sindh, including Karachi, and ordered immediate cleaning of the rivers due to the entrance of a westerly wave system entering the country at the end of April.
领英推荐
In the past month, several developments have occurred in Pakistan's power generation sector. On April 3rd, the Pakistani Planning Commission declined to extend funding for the 600-MW solar plant project in Muzaffargarh due to resource constraints during the current fiscal year. Meanwhile, on April 10th, the Saudi Fund for Development signed an agreement to extend a $240 million loan to Pakistan for the construction of the $1.2 billion Mohmand Multipurpose Dam project. Additionally, authorities approved the construction of two new dams, Mujahid and Mohata, in Rawalpindi due to the acute shortage of water and plummeting groundwater sources.
The cost of the Diamer Bhasha Dam project in Pakistan has increased by over Rs 1000 billion from the initial estimated cost of Rs 894 billion to over Rs 1,936 billion due to the devaluation of the Pakistani rupee vis-à-vis the US dollar. On a positive note, Indus Earth Trust has installed 19-kilowatt mini-grids powered by solar energy in Ishaq Jokio, a small settlement in the Sindh province of Pakistan, to provide a life-changing solution to residents who are accustomed to enduring long hours of power cuts during peak consumption in summer. Finally, on April 26th, the Neelum Jhelum Hydropower Project, which was closed for a year due to a tunnel collapse, is set to resume power generation by the end of July, with significant progress having been made in restoring the blockade in the tail race tunnel.
On April 6th, Pakistan State Oil (PSO) reported a financial crisis due to the devaluation of the Pakistani rupee against the US dollar, with the company struggling to receive payments for its supplies since it entered the LNG business in 2015. On April 11th, PSO further delayed the import of two cargoes of diesel from Kuwait Petroleum Corporation (KPC) due to low consumption of diesel from legal channels, as smuggled Iranian oil has taken over the local market.?
Meanwhile, on April 18th, the Pakistan Association of Large Steel Producers (PALSP) appealed to Prime Minister Shehbaz Sharif to intervene and stop the large-scale smuggling of steel from Iran and Afghanistan. PALSP estimates that around 500,000 MT of steel is smuggled annually into Pakistan from these two countries, resulting in a revenue loss of approximately 25 billion rupees to the national exchequer and pushing the country towards de-industrialization. Pakistan's import of steel and scrap iron has also declined by more than 50% in the first 9 months of FY23, reflecting a decline in the Large-Scale Manufacturing sector in February and declining steel consumption in Pakistan for the last 5 years.?
AGRI UPDATES & PAKISTAN POLICY
On April 3, the coalition government in Pakistan held a meeting to discuss a possible negative decision by the Supreme Court bench in the Punjab elections delay the case. The government declared that any decision by the three judges on the issue would be unacceptable. The following day, the Supreme Court ruled that the Election Commission of Pakistan's decision to delay the polls to the Punjab Assembly until October 8 was unconstitutional. The court set May 14 as the new date for the polls in the province, and the Federal government was ordered to give Rs. 21bn in funds to ECP by April 10. According to the electoral schedule issued on April 6 by the electoral body of Punjab, nomination papers for the candidates were to be submitted by April 10, the list of candidates was to be published on April 19, and electoral symbols were to be issued on April 20.
On April 11, the Joint Sitting of Parliament passed the Supreme Court (Practice and Procedure) Bill, 2023, which limits the powers of the Chief Justice of Pakistan. The federal cabinet referred the matter of releasing funds to the Election Commission of Pakistan for conducting elections in Punjab on May 14 to parliament. PTI launched a white paper on April 10 to commemorate the first year of the Pakistan Democratic Movement (PDM) in power, which criticized how the ruling coalition had "devastated" the economy and "contravened" the Constitution.
The Supreme Court of Pakistan issued notices to political parties regarding the holding of elections in Punjab and Khyber Pakhtunkhwa and directed the federal government to provide Rs 21 billion to the Election Commission of Pakistan by 27th April 2023 for the general elections. Despite expressing readiness to show flexibility, the court stated that it would be difficult to change the date of the upcoming elections for the Punjab Assembly.?
President Arif Alvi of Pakistan rejected the Supreme Court (Practice and Procedure) Bill 2023 which would curtail the chief justice's powers. President Alvi rejected multiple other PDM-passed bills as well. Meanwhile, the ruling coalition planned to hold a meeting of heads of parties after Eid-ul-Fitr. The PTI and PPP finalized their candidates for the Punjab Assembly polls. Anwar-ul-Haq was elected unopposed as the new PM of Azad Jammu and Kashmir, with the support of the PDM.
The Pakistan Army confirmed the defense ministry's input to the Supreme Court and Election Commission of Pakistan regarding troops' availability for election security based on ground realities and active facts. Moreover, the federal cabinet approved the Finance Ministry's summary to provide Rs 21 billion to the Election Commission of Pakistan for the general elections of Punjab and Khyber-Pakhtunkhwa. The Supreme Court of Pakistan is set to hear a petition on Thursday seeking general elections to the national and provincial assemblies on the same date.
Pervaiz Elahi’s house was attacked by the Punjab government as the PDM government and the PTI sat down for negotiations on when the elections were to take place on the orders of the Supreme Court. The negotiations remained unsuccessful despite a couple of rounds.?
Pakistan's current account posted a surplus of $654 million in March 2023, after a gap of over two years, supported by higher remittances inflows and contraction in imports. This surplus marks the highest monthly surplus in eight years, and it has helped to reduce the current account deficit by 74% during the first nine months of the fiscal year 2022-2023. Pakistan's borrowing has also declined by 39.18% to $7.764 billion from various financing sources during the same period. Meanwhile, foreign direct investment (FDI) increased by 62% to $163.4 million in March compared to last year, with China and Japan being the major contributors. However, some experts have raised concerns about the ad-hoc import restrictions that have led to the current account surplus, as these restrictions may hinder economic growth and employment opportunities in the long run.
In early April, Pakistan's Finance Minister, Ishaq Dar, attended the World Bank and International Monetary Fund's spring meetings in Washington to campaign for the renewal of Pakistan's IMF package. The country was waiting for verification from the UAE on an additional $1 billion deposit to secure a staff-level agreement with the International Monetary Fund (IMF) after getting confirmation from Saudi Arabia on $2 billion additional deposits.
Pakistan met another World Bank condition on April 6th, in order to qualify for a $450 million loan to bridge a $6 billion financing gap. According to the World Bank, the federal government's spending on devolved ministries has increased from 0.4% to 0.6% of GDP over the past decade, amounting to over Rs 315 billion per year. The government is also engaging in devolved subjects through semi-autonomous bodies such as the HEC and NCHD, with the HEC spending around Rs 70 billion in FY2022.
On April 12th, the International Monetary Fund (IMF) revised Pakistan's GDP growth rate projection for the current fiscal year from 2% to 0.5%, with a projected rise in inflation from 19.9% to 27.1% and unemployment from 6.2% to 7%. The World Bank and Asian Development Bank also revised downward their GDP growth projections for Pakistan. The IMF projected a decrease in Pakistan's government gross debt from 75.8% of GDP in 2022 to 73.6% in 2023 and a further decline to 68.9% in 2024. The IMF also warned of rising unemployment in Pakistan, and the government is in talks with the IMF to receive a key tranche of a $6bn bailout package signed in 2019.
An IMF report revealed that Pakistan will miss the fiscal and debt reduction targets of this fiscal year and the situation will become worse in the next fiscal year with a budget deficit peaking at 8.3% of the size of the nation's economy. However, Pakistan secured financial support from China and the United Arab Emirates worth $1.3 billion, with the UAE promising $1 billion to support Pakistan's forex reserves, and China releasing the last tranche of a $1.3 billion rollover loan. In addition, the Asian Development Bank expressed willingness to defer Audited Entity Financial Statements (AEFS) of electricity distribution companies (DISCOs) till December 31, 2023, to bring Second Power Distribution Enhancement Investment Program on track.
Pakistan's exports continue to face significant challenges as the country's merchandise exports fell by 14.76% YoY to $2.36 billion in March, marking the seventh consecutive monthly decline. The Pakistan Bureau of Statistics released data revealing that exports in the first nine months (July to March) of 2022-23 were down 9.87% at $21.04 billion compared to $23.35 billion in the same period last year. This situation has raised fears of significant job losses in the export sector, which is crucial for the country's economy. A new circular from the State Bank of Pakistan (SBP) imposes restrictions on exporters who delay repatriating their export proceeds. Exporters argued that delayed remittances can be caused by factors out of their control. The opposition by exporters highlights the dire situation and uncertainty around Pakistan's struggling exports.
On April 3rd, Finance Minister Ishaq Dar announced that China had rolled over its $2 billion loan to Pakistan for another year, dismissing media reports that suggested otherwise. Pakistan's public debt increased to Rs 52.721 trillion by December 2022, with domestic debt accounting for 63% and external debt for 37%. On the other hand, the capital gains tax (CGT) collection from Pakistan's stock exchange decreased by Rs 1.3 billion compared to the previous year, standing at Rs 4.3 billion from July-March 2022-23. On April 4th, the State Bank of Pakistan (SBP) held a meeting of the Monetary Policy Committee (MPC) to discuss key economic issues and decide on the key policy rate. Analysts predicted that the monetary policy would tighten further due to rising inflation, where SBP later announced an increase in its Policy Rate from 20% to 21%.
Pakistan's trade deficit was reduced by 35.51% to $22.9 billion during the first nine months of the current fiscal year, while on April 6th, investors in Pakistan withdrew Rs 32.38 billion ($190 million) from national saving schemes due to low rates of return compared to banks on fixed investments. On April 11th, Pakistan's home remittances for March 2023 reached $2.5 billion, the highest in seven months, due to seasonal inflows and an improved exchange rate.
INTERNATIONAL – OVERVIEW & MARKET OUTLOOK
China's exports surged by 14.8% YoY, the first rise in six months, while imports fell a smaller-than-expected 1.4%. China and India have also been recording rising LNG imports due to lower spot prices. Americans are increasingly seeing China as an "enemy" of the US rather than a competitor, according to a new survey, while China's RMB Yuan has surpassed the US dollar to become the most-used currency in China's cross-border transactions. Finally, on April 27th, the US dollar is facing a growing challenge to its status as the top global currency, with China leading the drive against over-reliance on the greenback. China has also warned the US and South Korea against provoking confrontation with North Korea, urging all parties to play a constructive role in promoting a peaceful settlement of the issue.
On April 26, 2023, President Joe Biden announced via Twitter that he is running for re-election in the 2024 US presidential election, despite concerns over his age of 80. This announcement comes in the midst of what experts have called an impending economic catastrophe.
This is because, in recent months, the US stock market has experienced substantial instability, with various events impacting its performance. On April 3, Wall Street rallied and the Nasdaq saw its biggest quarterly percentage gain since June 2020, due to cooling inflation and hopes that the Federal Reserve would soon end its aggressive interest rate hikes. However, on April 6, concerns over the US economy entering a recession caused by the Federal Reserve's rapid interest rate hikes and weak economic data led to declines in the S&P 500 and Nasdaq. On April 10, US stock indexes rose on the news that Alphabet's Google unit plans to add AI features to its search engine. The US dollar also strengthened on April 10 after data revealed a rise in jobs, indicating the Federal Reserve may consider increasing interest rates next month. The benchmark S&P 500 edged higher on April 12, with economy-sensitive energy and material stocks leading gains ahead of Wednesday's inflation data. On April 14, US stock indexes rose after a Labor Department report showed producer prices unexpectedly fell in March and there were signs that underlying producer inflation was subsiding. However, concerns over a potential US default loomed on April 26, as Treasury Secretary Janet Yellen warned that a failure by Congress to raise the government's debt ceiling could trigger an "economic catastrophe" that would send interest rates higher for years to come. It remains to be seen how the US stock market will be impacted by these events.
On April 14, 2023, the military in Sudan staged a coup, overthrowing the transitional government that had been in power since the removal of former President Omar al-Bashir in 2019. This move has been met with protests and opposition from various groups within the country, including the Sudanese Professionals Association (SPA), which is leading protests calling for a civil government.
The conflict has resulted in violent clashes between the military and opposition groups, with dozens of casualties, thousands wounded and hundreds of civilians displaced. The military has imposed a curfew and cut off internet and phone services, making it difficult for people to communicate and for news to come out of the country. The situation in Sudan is still volatile, with protests and violence continuing. The military has vowed to maintain control of the government, while opposition groups are calling for a return to civilian rule. This conflict has also led to a humanitarian crisis, with shortages of food and medicine, and displacement of civilians.
The military is currently in power, while the opposition groups, including the SPA and various political parties, are calling for a return to civilian rule. There are also reports of militias and armed groups operating in different parts of the country. The military has been accused of using excessive force against civilians and opposition groups, while the opposition has been accused of inciting violence. Internationally, the African Union and the United Nations have condemned the military takeover and have called for a peaceful resolution to the conflict. Both have suspended Sudan's membership in response to the military takeover. The conflict has also raised concerns about the fragile peace agreement between Sudan and South Sudan since 2018. South Sudan has expressed concern about the situation in Sudan and has called for a peaceful resolution. The United States and the European Union have also expressed concern and have threatened sanctions if the military does not return power to a civilian government.
The conflict between Russia and Ukraine continued in April, with Russian forces launching airstrikes and artillery attacks on cities in eastern Ukraine on April 11th. Meanwhile, US officials tried to locate the source of leaked classified US documents, including Ukrainian counter-offensive plans. On April 14th, Russia claimed to have blocked Ukrainian forces inside Bakhmut, but Ukraine maintained that supply lines remained open. Finland began construction of a 200-kilometer border fence with Russia on April 17th, with completion set for 2026, to reduce dependence on Russian border control effectiveness. On April 19th, Ukrainian President Volodymyr Zelensky visited frontline troops in Avdiivka, while Russian leader Vladimir Putin visited occupied zones in southern and eastern Ukraine under a veil of secrecy. Ukraine urged the international community on April 26th to exert pressure on Russia over the future of the Black Sea grain deal, which is set to expire on May 18. Finally, on April 27th, Chinese President Xi Jinping spoke with Zelensky, advocating for peace negotiations and stating that China would not take advantage of the crisis to profit.
Recent events have seen a flurry of diplomatic activity in the Middle East, as countries work to strengthen ties and end years of isolation. On April 3rd, Saudi Arabia announced that it would invite Syrian President Bashar al-Assad to an upcoming Arab League summit, which would mark the end of Syria's regional isolation. Meanwhile, Iran appointed an envoy to the UAE for the first time since 2016 on April 6th, in an effort to boost ties between the two countries. Later that week, Saudi Arabia and Iran held their first formal meeting in over seven years in Beijing, hosted by China. The two countries are working on the next steps of their reconciliation following a China-brokered deal.
On April 12th, ministers from nine Arab countries met in Saudi Arabia to discuss the possibility of Syria returning to the Arab League and re-engaging with the Arab world after years of isolation. Qatar and Bahrain also restored diplomatic ties after a three-year-long dispute, while Saudi Arabia hosted delegations from Iran and Syria in hopes of re-establishing diplomatic ties. Finally, on April 19th, Saudi Arabia's foreign minister made the first visit by a Saudi official to Damascus since the start of Syria's civil war in 2011, signaling a shift in regional relations. The United Arab Emirates and Qatar are also in talks to reopen their respective embassies and restore diplomatic ties after the lifting of a blockade on Qatar in January 2021. These recent developments suggest a hopeful turn in the complex web of Middle Eastern relations.
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