Terror attack slows Pakistan’s polymer trade

04 March 2009 08:52  [Source: ICIS news]

SINGAPORE (ICIS news)--Polymer trade has slowed to a crawl in Pakistan due to the ongoing political instability in the country and following Tuesday’s terror attack in Lahore, traders said on Wednesday.

"Trade in polyethylene (PE) and polypropylene (PP) has been rather tepid lately, and the attack by terrorists has worsened the situation,” a Karachi-based polymer trader said.

“We don’t know when the situation will improve,” he added.

The attack on the Sri Lankan cricket team, which injured several players and killed eight people including six policemen, has intensified the anxiety among traders and processors about its possible fallout on Pakistan’s economy.

“Sentiment was already weak due to the political wrangling between Pakistan’s ruling party and the opposition, and Tuesday’s attack has made things worse,” said a second polymer trader based in Pakistan.

A third Pakistani trader, who was in Lahore at the time of the attack, said PE and PP buyers had retreated to the sidelines and were waiting for stability to be restored before making fresh purchases.

The Karachi Stock Exchange’s benchmark KSE-100 index shed 84.80 points or 1.5% on Tuesday to close at 5,596.49 on a turnover of 75.72mn shares.

The KSE-100 fell 5% on 25 February in its worst single-day performance in 32 months after the Supreme Court nullified last year’s election of opposition leader and former prime minister Nawaz Sharif.

Pakistan has no PE or PP capacity and is totally dependent on imports. Annual consumption of PE and PP in the country in the year ending June 2009 is estimated at 200,000 tonnes and 220,000 tonnes, respectively.

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By: Prema Viswanathan
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