FOUR years after being placed on the “grey list” through the Financial Action Task Force (FATF), Pakistan’s request was removed despite everything on Friday. money laundering and had also worked in the fight against the financing of terrorism. The watchdog, the FATF, said that in addition to correcting technical shortcomings, Pakistan had improved the effectiveness of its cash laundering formula and worked to combat terrorist financing.
FATF Chairman T. Raja Kumar said: “They (Pakistan) have been removed from the grey list, but there is still work to be done on their part. I inspire Pakistan to continue to work with the Asia-Pacific organization to continue to take action to fight terrorist financing.
What is the FATF?
The Financial Action Task Force is an intergovernmental framework established in 1989. It was created to combat money laundering, terrorist financing, and other similar threats to the integrity of the foreign monetary system. As a decision-making framework, the FATF works to generate the mandatory political will to adopt national legislative and regulatory reforms in these areas.
What is list and blacklist?
The FATF monitors and reviews jurisdictions with terrorist financing activities that would potentially jeopardize the global monetary system. On this basis, the FATF identifies these countries in express lists.
Grey List: Global Watchdog’s grey list includes countries that are considered safe havens for terrorist financing and money laundering. Any country that is included in this list is considered a warning that it would possibly enter the FATF blacklist.
Blacklist: so-called non-cooperative countries are on the blacklist. The countries on this list have terrorist financing and cash laundering activities. The vote of 3 countries is required to be blacklisted.
Why is Pakistan on the grey list?
Pakistan has been placed on the grey list because it has failed to combat the threat of cash laundering, which leads to terrorist financing and corruption. The Dawn newspaper reported that it also included in the biggest threat to track deficiencies in its legal, monetary and regulatory system. investigations, prosecutions, judicial and non-governmental sectors.
Since then, it has maintained high-level political commitments to address those problems through a 27-point plan. Subsequently, the number of shares rises to 34.
Earlier, in June, the FATF found that Pakistan largely complied with all 34 issues and submitted a draft to determine this before pronouncing its removal from the grey list.
Pakistan had still addressed elements of the 34-point action plan regarding Lashkar-e-Taiba (LeT) founder Hafiz Saeed, Jaish-e-Mohammed (JeM) chief Masood Azhar, and the group’s “operational commander. “”, Zakiur Rehman Lakhvi.
Why did Pakistan get rid of the list?
One of the main reasons Pakistan dropped off the grey list is that, in June, Pakistan found that it met or “largely complied” with FATF requirements.
In June 2018, the FATF suggested Islamabad put in place a 27-point action plan to combat money laundering and terrorist financing by the end of 2019. However, the coronavirus outbreak has led to an extension of the deadline.
Subsequently, the 27 issues went to 34 numbers.
The FATF then took the draft resolution to the country to verify this in person.
Between 29 August and 2 September, a joint delegation of 15 FATF and its regional affiliate, the Sydney-based Asia-Pacific Group, visited Pakistan to assess the country’s compliance.
Post-launch benefits
First, the country’s foreign status would likely be affected by its delisting, which will also expand Pakistan’s economic clients at a time when it struggles to control inflation and attract foreign investment.
Islamabad has found it increasingly difficult to obtain financial assistance from the IMF, World Bank, Asian Development Bank (ADB) and European Union due to Pakistan’s current “grey list” position, further aggravating the country’s already dire financial situation. Pakistan can now seek foreign help for its dire economic scenario because it is no longer on the “grey list”.
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