- Does TTC want its money or is the latest suit just a move in the game?
Tethyan Copper Company has filed suit in a New York court for the enforcement of the $6 billion award made to it by the World Bank’s International Tribunal for the Settlement of Investment Disputes. That implies that the initial prospect being held out by the government, that the company viewed the award as a weapon in an effort to get the project restored to it, was unfounded. TTC, principals, the companies which formed the joint venture TTC, Antofagasta of Chile and Barrick Gold of Canada, seem bent on getting the money.
And who can blame them? The Award not only covers the investment the joint venture made, but probably equals what TTC would have made from the project itself. Not only does it get the money, but avoids the headaches inherent in actually carrying out the project. The only catch seems to be the very size of the award, which is so large that Pakistan has nowhere near the assets abroad needed to pay it. At home, Pakistan is in a parlous economic situation, and would not be able to make the payment in one go, not with its forex reserves expected to be about $17 billion at the end of the quarter, and badly needed to pay for vital imports of food, fuel and medicines. $6 billion is the size of both the Award and the IMF package which has caused so much grief because of its conditionalities. Is the suit thus meant to pile pressure onto Pakistan, was it merely something TTC felt it had to do, or does it mean it means to take its pound of flesh, come what may?
The government may think that it will achieve something either from its domestic investigations or its international litigation. Neither is a reliable assumption. It would be much better if the government was to work with dedication towards a settlement out of court with TTC. Not only is money involved, but this is exactly the kind of dispute designed virtually to drive away the foreign investors so anxiously sought by the government.
