ISLAMABAD – Washington last week persuaded member states of the FinancialAction Task Force (FATF) to place Pakistan back on the “grey list” ofnations with inadequate terrorist financing or money laundering controls.Pakistan was on the list for three years, until 2015.
The diplomatic setback has sparked anger in Islamabad against the US, whichchampioned the motion against Pakistan at the FATF meeting in Paris. Itrepresented another blow to the worsening relationship between the uneasyallies, who have long differed on how to combat militants waging war inAfghanistan.
It has also heightened concerns that Pakistan is becoming internationallyisolated, and that its economy could suffer if global banking intuitionscut links with the nuclear-armed nation, or otherwise increase the cost ofdoing business with Pakistan.
Mr Miftah Ismail, who led Pakistan’s negotiations in Paris, told *Reuters*thatWashington did not seem genuinely eager to see Pakistan boost its terroristfinancing regulations and was instead bent on humiliating the country.
“If the Americans were interested in working with us and improving our CTF(counter-terrorist financing) regulations, they would have taken the offerI was making them,” he said. “But their idea was just to embarrassPakistan.”
Mr Ismail said that he had urged the US to allow Pakistan until June to fixany outstanding CTF issues and ceded ground in negotiations to strike adeal, but that the US was determined to see Pakistan suffer.
The adviser said Pakistan’s law-enforcement shortcomings were oftenconfused for lack of desire, especially at provincial level, where policeofficers are poorly trained when it comes to terrorist financinglegislation.
“The will is there,” he added.
Mr Ismail ruled out Pakistan’s retaliation against Washington over theFATF listing. He said the country would keep working to improve its CTFcapabilities and win the confidence of Britain, Germany and France, whoco-sponsored the US motion in Paris.
Pakistan hoped to be removed from the grey list in six to 12 months fromJune, when it would be officially placed on the watchlist, Mr Ismail added.
The adviser said he did not foresee the FATF decision acting as a brake onPakistan’s economy, which, with growth above five per cent, is expanding atits fastest pace in a decade.