IMF expands talks scope to Reko Diq | The Express Tribune
Key Takeaways
- The IMF has requested a detailed briefing from the Pakistani government regarding the status of the Reko Diq mining project.
- This request signifies an expansion of the IMF's oversight from standard financial reviews to scrutiny of major national projects.
- The project is nearing financial close, backed by substantial international loans, including significant commitments from the US Exim Bank.
- The Pakistani Finance Ministry views sharing information as crucial because the project represents the largest FDI in Pakistan and will significantly benefit the national economy and foreign exchange reserves.
- The estimated cost for Phase I of the Reko Diq project has seen multiple recent increases, now standing at $7.72 billion, with projected net cash flows of $70 billion over 37 years.
The International Monetary Fund (IMF) has expanded its scrutiny in Pakistan by bringing the massive Reko Diq mining project under its purview, requesting a detailed briefing from the government on its current status. This move is unusual as the IMF typically focuses on balance-of-payments support rather than major private sector-involved projects, although the government views the project's scale as relevant to the national economy. The request comes as the project, operated by the Reko Diq Mining Company where Barrick Gold holds a 50% stake, is approaching financial close backed by approximately $3.5 billion in international loans. The project is touted as the largest single Foreign Direct Investment in Pakistan, expected to significantly boost mineral sector output and strengthen foreign exchange reserves. Despite recent cost revisionsāwith Phase I now estimated at $7.72 billionāthe project projects a net cash flow of $70 billion over 37 years, attracting interest from global players like the US and China. The briefing is scheduled for next week as part of the ongoing second review of Pakistan's $7 billion bailout program.
