The Special Investment Facilitation Council (SIFC), which is jointly managed by Pakistan’s government and military, has authorized the appointment of advisors to help the Saudi Arabian government acquire a majority stake in the Reko Diq gold and copper mine project from Pakistan and Canada’s Barrick Gold.
The SIFC’s highest committee reportedly made the official decision this week to include another country in the Reko Diq project, according to sources speaking to The Express Tribune.
General Asim Munir, Chief of the Army Staff, and Prime Minister Shehbaz Sharif met at a forum presided over by Sharif.
The SIFC has authorized in principle 28 projects worth billions of dollars that will be presented to Gulf countries for investment, including the construction of the Diamer-Bhasha dam and mining operations at Reko Diq in Balochistan’s Chagai district, as reported by The Express Tribune last month.
According to government insiders, at his final meeting as SIFC chairman, the prime minister ordered the Ministry of Energy to retain financial advisors in order to sell stakes in the Reko Diq mining project to investors.
Shares held by Pakistan and Barrick Gold should be lowered in a proportional fashion in accordance with the judgment.
Reko Diq mine is jointly owned by Barrick Gold and the governments of Pakistan and Balochistan, each of which holds a 50% share.
The prime minister also determined that Rising Pakistan would serve as the SIFC’s official logo, reflecting the shared goal of the country’s civilian and military leaders to use the SIFC to reduce Pakistan’s reliance on foreign loans.
Pakistan established the SIFC to promote cooperation between the federal government and the provinces in order to speed up the decision-making process, reduce wasteful duplication of effort, boost confidence among investors, and guarantee efficient project rollout.
The SIFC’s highest body also made up its mind to have the Ministry of Energy propose a negotiation committee to start talking to Saudi Arabia about joining the project as a partner.
In a similar vein, the Ministry of Energy would initiate the sale of the federal government’s stake in the Reko Diq project through the sale of shares held by three state-owned enterprises.
Shares in the mining project are owned by the federal government through Government Holding Private Limited, Oil and Gas Development Company, and Pakistan Petroleum Limited.
According to the Ministry of Energy, the SIFC has set a deadline of December 25, 2023 for the completion of the transaction, which includes the signing of bidding documents.
CEO Mark Bristow of Barrick Gold stated this week that the company “won’t be diluting its equity in the project but will not mind if Saudi Arabia’s Public Investment Fund (PIF) wants to buy out the equity of the Pakistan government.”
In addition, it was agreed that the transaction would be finalized by December 2023 without the requirement for any regulatory or legal exemptions from the SIFC.
At the third meeting, the prime minister voiced his approval of the work done by the SIFC’s affiliated ministries.
The SIFC recognized the secretariat’s efforts in moving things along quickly.
To encourage capital investment in such industries, the prime minister has ordered the relevant ministries to stabilize financial models and transaction possibilities.
In addition, the SIFC determined that the Ministry of Information and Broadcasting and the Inter-Services Public Relations (the military’s media wing) would work together to promote the good work being done by the council.
The prime minister gave orders for SIFC to promote the need for investment in more than just the Gulf countries.
The Board of Investment Act has been updated to provide legal protection for the SIFC’s operations.
The Army Act has also been amended to make the military’s economic role more official and lawful.
To date, the government of Pakistan has transferred seven companies’ assets totaling Rs2.3 trillion to the Pakistan Sovereign Wealth Fund. Three of these companies have stakes in the Riko Diq project, and their dividends would go toward funding SIFC initiatives.
Following a recommendation by the SIFC Secretariat, the Ministry of Interior has agreed to grant visas within a day, alleviating a significant concern of international investors.
The federal and provincial Sindh administrations agreed to construct the Thar Coal Railway Connectivity project in a timeframe of one and a half years.
The SIFC also voted to give the federal government more authority over minerals, which are traditionally handled at the provincial level.
Consultants have been commissioned by the Ministry of Energy to draft a unified legislative and regulatory framework for the mining industry.
The Council of Common Interests has chosen to limit the federal government’s involvement to that of a facilitator, with the federal government assisting the provinces in developing model laws, rules, and regulations.
