WASHINGTON (Reuters) – The International Monetary Fund will give Pakistan $450 million in emergency flood aid and disburse funds in September to help the country's economy cope with the devastation, the head of the IMF said on Thursday.
Severe flooding in Pakistan has destroyed cropland and livestock and displaced millions of people, causing damage the
government has estimated at $43 billion, or almost one quarter of the South Asian nation's 2009 GDP.
"The IMF ... will be the first agency likely to disperse very rapidly money which is absolutely needed," IMF Managing Director Dominique Strauss-Kahn told reporters after a week of discussions with Pakistani officials. "The most important thing is to keep the Pakistani economy .. on track."
(For a slideshow: Children of the flood, click http://in.reuters.com/news/pictures/slideshow?articleId=INRTR2HTZZ)
Talks with a delegation led by Pakistan's Finance Minister Abdul Hafeez Shaikh on the terms of an $11 billion IMF loan program left him satisfied with the country's commitment to reforms, the IMF chief said.
Under the 2008 IMF loan program, Islamabad pledged to implement tax and energy sector reforms and give full autonomy to the State Bank of Pakistan.
"What is important is what was decided by the government to do to improve the economic situation, especially in the tax sector but in other fields also," said Strauss-Kahn.
"What I heard from the authorities is that they really want to move on with the program," he said.
Shaikh said Islamabad remained committed to loan terms, including fiscal authority and tax reforms.
Pakistan's ambassador to the United States, Husain Haqqani, said IMF faith in its reform commitments could help boost international "solace and confidence" in the country's economic prospects and fiscal discipline despite the flood calamity.
"We expect the markets to respond positively and we also expect other donors in a more aggressive manner now that they know Pakistan is going to continue with economic reforms," he told Reuters in an interview.
Describing the flood damages as "manifold worse than the (2005) tsunami, the Haitian earthquake and the 2005 earthquake in Pakistan," Haqqani appealed to Washington to take steps to allow Pakistan to export more textiles to the U.S. market under special low-tariff programs.
One program, the "Reconstruction Opportunity Zones" trade package that allows tariff goods for certain Pakistani garments, remains stalled in the U.S. Senate and faces opposition from some American textile groups.
"Because of the magnitude of the impact of the floods, as well as the fact that Pakistan is a front-line state in the global war against terrorism, there is a case to be made that Pakistan needs to be given that preferential access," said the ambassador.
(Editing by Andrew Hay)
WASHINGTON (Reuters) – The White House stressed on Thursday that no second economic stimulus package is being considered as part of new measures under review by President Barack Obama's team.
Obama said on Monday he and his advisers are discussing further tax cuts for businesses to help create jobs, as well as an extension of tax cuts for the middle class, rebuilding U.S. infrastructure and increasing investments in clean energy and research and development.
The Washington Post reported on Thursday that the business tax cuts could be potentially worth hundreds of billions of dollars.
"There have been a lot of reports and rumors on different options being considered -- many of which are incorrect," said White House spokeswoman Amy Brundage.
"The options under consideration build on measures the president has previously proposed, and we are not considering a second stimulus package. The president and his team are discussing several options, as they have been for months, and no final decisions have been made," she said.
Obama is expected to outline in the coming days and weeks several targeted initiatives to help spur the recovery and hopes Congress will approve them before stopping work to focus on November 2 elections.
Obama is to travel to Milwaukee to speak to a labor rally on Monday, the Labor Day holiday, and is to visit Cleveland on Wednesday. He is to hold a White House news conference on September 10.
Obama is under strong election-year pressure to increase U.S. job growth after an $814 billion stimulus plan he and his Democrats pushed through Congress in February 2009 saved or created millions of jobs but has not reduced the U.S. jobless rate of 9.5 percent.
Experts say a Labor Department report due on Friday could show an uptick in the U.S. jobless rate in August to 9.6 percent from 9.5 percent in July. Obama is expected to comment on the figures on Friday.
The Washington Post reported that among the options under review by the Obama team are a temporary payroll tax holiday and a permanent extension of the research and development tax credit.
(Reporting by Steve Holland and Alister Bull; Editing by Cynthia Osterman)
LOS ANGELES (Reuters) – Video game maker Take-Two Interactive Inc (TTWO.O) on Thursday smashed Wall Street expectations for its fiscal third quarter and raised its forecast for the current fourth quarter, citing strong sales for its "Red Dead Redemption" title.
The company's shares rose 12.4 percent in after-hours trading.
The New York-based company raised its outlook for the fourth quarter and said it expects to be profitable for the full fiscal year, after previously forecasting a net loss.
"It's a hit or miss business and 'Red Dead Redemption' definitely played a big role in the turnaround," said Atul Bagga, an analyst with ThinkEquity LLC.
Take-Two Interactive confounded analysts who had expected the company to suffer without a game release tied to "Grand Theft Auto," its most popular franchise.
If the company can stay profitable this fiscal year, it will be the first time it has achieved an annual net profit without releasing a "Grand Theft Auto" game.
Strauss Zelnick, chairman of Take-Two Interactive, said the company must continue to release quality games.
"It's true of all entertainment businesses, as they begin to mature so called 'B' titles stop selling and even 'A-' titles stop selling and only 'A+' titles continue selling," he told Reuters in an interview.
"Red Dead Redemption" has sold 6.9 million units since its release in May. The franchise is about half as popular with gamers as its older cousin "Grand Theft Auto," Bagga said.
The company has not said when it will release the next "Grand Theft Auto" title.
"If they can again turn a profit in 2011 I think that will be a big boost for investor sentiment," Bagga said.
The company posted a net profit for the quarter ended July 31, of $5.9 million, or 7 cents per diluted share, compared with a net loss of $56.5 million, or 73 cents per share, in the year-ago period.
Excluding items, the company earned 28 cents per share, ahead of the average of analysts' estimates of a loss of 6 cents a share, according to Thomson Reuters I/B/E/S.
The company, best known for its top-selling "Grand Theft Auto" game franchise, posted net revenue of $354.1 million, more than triple its revenue of $94.9 million in the year-ago period.
For the fiscal fourth quarter ending on October 31, Take-Two forecast a profit, excluding items, of 20 cents to 30 cents a share. It raised its outlook from an earlier forecast of a fourth-quarter loss, excluding items, of 10 cents to 20 cents, citing continued strong sales of "Red Dead Redemption."
Analysts on average had expected a loss of 12 cents a share for the current quarter, according to Thomson Reuters I/B/E/S.
Shares of Take Two rose 12.4 percent in after-hours trading to $9.95 after closing 3.4 percent higher at $8.85 on Nasdaq.
(Reporting by Alex Dobuzinskis; Editing by Carol Bishopric)