ISLAMABAD – Pakistan has managed to garner much-needed support from threemember states of the Financial Action Task Force (FATF) to avoid beingplaced on blacklist, but black clouds are still hanging over it.
Islamabad has been on the global money laundering watchdog’s radar sinceJune 2018, when it was placed on a grey list for terrorist financing andmoney laundering risks after an assessment of the country’s financialsystem and security mechanism.
Turkey was the only country that had opposed the move backed by the UnitedStates, the United Kingdom and Pakistan’s arch-rival India. However,Islamabad’s longtime ally, Beijing abstained.
Moving one step further, New Delhi — co-chair of the joint group of FATFand Asia Pacific Group — wants Islamabad to be placed on the Paris-basedwatchdog’s blacklist of the countries, which fail to meet internationalstandards in combating financial crimes.
However, an aggressive diplomatic push from Islamabad has frustrated thelooming threat with the support of Turkey, China, and Malaysia.
According to the 36-nation FATF charter, the support of at least threemember states is essential to avoid the blacklisting.
Confirming the development that took place at the five-day meeting of thewatchdog’s Plenary and Working Group meeting in Orlando, Florida last week,an official at Pakistan’s foreign ministry admitted that “the danger isstill not over”.
The group will finally announce the decision of not blacklisting Islamabadin its Plenary scheduled in Paris on Oct. 13-18.
“This is certainly a positive development that there is no imminent threatof blacklisting [by the FATF] due to crucial support from Turkey, China andMalaysia”, the official told *Anadolu Agency* on condition of anonymity ashe was not allowed to make a public statement due to the sensitivity of thematter.
But, he added, Pakistan had to meet the FATF deadline — January 2019 — tocomplete its action plan aimed at fully blocking the money laundering andother financial loopholes.
Foreign Ministry Spokesperson Mohammad Faisal refused to comment on thedevelopment.
In a statement in February this year, the FATF said: “Given the limitedprogress on action plan items due in January 2019, the FATF urges Pakistanto swiftly complete its action plan, particularly those with timelines ofMay 2019.”
The watchdog agreed that Islamabad had made progress towards implementationof the action plan — negotiated between Pakistan and the FATF members — inJune last year but still sought “dissuasive sanctions” and “ effectiveprosecution” in this connection.
Islamabad, at a meeting in Guangzhou, China last month, was reportedlyasked to “do more” as its compliance on 18 of the 27 indicators — pointedout in the action plan — was unsatisfactory.
Pakistan, in recent months, has taken some major steps in accordance withthe action plan, which includes, no foreign currency transactions without anational tax number, and ban on currency change of up to $500 in the opencurrency market without submission of a national identity card copy.
In addition to that, Islamabad has also proscribed several militant groupsand seized their assets, including Jamat-ud-Dawa’h, and Jaish-e-Mohammad(JeM) — the groups blamed for several terrorist attacks such as the 2009deadly Mumbai attacks killing over 150 people.Success of active diplomacy
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The foreign ministry official said that Pakistan was in constant touch withTurkey and other friendly countries to use their good offices to helpIslamabad move out of the grey list.
Pakistan had faced a similar situation in 2011 when it was included in thegrey list and was taken out only in 2015 after it successfully implementedan action plan.
Islamabad requires at least 15 out of 36 votes to move out of thewatchdog’s grey list, which is causing an estimated loss of $10 billion peryear.
Foreign Minister Shah Mahmood Qureshi, who is currently on a state visit tothe UK, claimed on Wednesday that London had agreed to support his countryin its efforts to move out of the list.
Political and security analysts, however, reckon it will not be a walk inthe park.
“This is good news but the danger is still looming”, Ali Sarwar Naqvi, aformer ambassador told *Anadolu Agency* and added, “This is just atemporary relief allowing us to rally more and more support to permanentlyget rid of this threat.”
He observed that Pakistan was still required to meet some key FATFconditions to move out of the list, and avoid being blacklisted.
Naqvi, who served as Pakistan’s ambassador to Jordan, Belgium, and Austriafrom 1970 to 2006, said that active diplomacy with the help of friendlycountries would give a boost to Islamabad’s ongoing efforts steer out ofFATF scanner.
“As far as I know, they [foreign ministry] is already in touch with FATFand Asia Pacific Group members and other friendly countries, and briefingthem of measures it has taken to combat terror financing and moneylaundering recently,” he said.
About the US opposition to Pakistan in the FATF, Naqvi, who also served asan acting ambassador to the US, said: “Pakistan cannot do much to persuadethe US. The fact is that the US opposition is not based on FATF charter buton political consideration, mainly because of clash of interests inAfghanistan, and Islamabad’s ever-growing relations with China.”
Mohiuddin Aazim, a Karachi-based economic analyst thinks that Pakistan islikely to be removed even from the gray list though FATF may make someobservations urging Islamabad to remain vigilant and continue to strengthenits anti-money laundering and counter-terrorism financing regime.
“The removal of Pakistan from the gray list is likely both due todiplomatic support of China, Turkey and Malaysia and due to a host ofmeasures the country has taken to stop money laundering and terrorfinancing,” Aazim told *Anadolu Agency*.
On the diplomatic front, he opined, seeking the help of other countriesnotably of Saudi Arabia and the US would be important but even with thealready available support of China, Turkey and Malaysia, it was very muchlikely that Pakistan would get out of the grey list.
On the economic front continuing with strong resolve all measures taken tostop money laundering and terror financing and initiating more measures isimportant to avoid any hostile FATF action in future, he maintained. -AA
