Pakistan faces huge losses worth $38 billion due FATF greylist

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Pakistan faces huge losses worth $38 billion due FATF greylist

The Financial Action Task Force (FATF) is expected to announce later today whether Pakistan has done enough to exit the grey-list as it wraps up its four-day plenary meeting.

The FATF president will give a press briefing on the outcomes of the FATF plenary at 4:30 pm Pakistan time.

Earlier last week, the Foreign Office (FO) spokesman had said that Pakistan had made substantive progress on the remaining six items of the FATF action plan and was duly acknowledged by the wider FATF membership.

The FATF had placed Pakistan on the grey list in June 2018 and placed 27 conditions for review for complying in one year, till September 2019. Pakistan was so far given three extensions of three months each, every time to comply with the 27-point action plan.

Until the last assessment, Pakistan was found deficient in acting against the organisations allegedly linked to the terror groups listed by the UN Security Council, prosecuting and convicting banned individuals and tackling smuggling of narcotics and precious stones.

Recently, the authorities had taken further steps including the prosecution of Lashkar-e-Taiba chief Hafiz Saeed and his associates in terror financing cases.

Meanwhile, a new research paper published by an independent think-tank, Tabadlab, has stated that Pakistan sustained a staggering $38 billion economic losses due to FATF’s decision to place the country on its grey list thrice since 2008.

The losses are worked out on the basis of reduction in consumption expenditures, exports, and foreign direct investment (FDI).

The paper, titled ‘Bearing the cost of global politics — the impact of FATF grey-listing on Pakistan’s economy’ by Dr Naafey Sardar, underlines that the decision of placing Pakistan on the grey list in 2018 appears to be against the FATF norms, as, normally, the decision materialises by taking into consideration the Mutual Evaluation Report (MER) of the respective country.