FATF and beyond

  • Pakistan’s many challenges

The challenge at Financial Action Task Force (FATF) was unprecedented. It all started when before the Paris meeting, the US State Department held a press conference to announce its plan to move a resolution, with the support of Germany and Great Britain, to place Pakistan on the grey-list. Pakistan has been agitating that the risks due to residual deficiencies in its anti-money laundering and combating the financing of terrorism (AML/CFT) regime are overstated. Also, these risks are overblown by India and even though the Indians have been working behind the scene the move was essentially an Indian inspired initiative. This was most visible in the Indian media where a frantic picture was painted of doom and gloom about to fall on Pakistan, an occasion for celebration and delight. Despite this, Paris should not have happened.

First, it was not a forum where the UN Security Council type of politics is played out. It is a serious forum, with closed-door proceedings, which deliberate on methods for curbing money laundering and preventing financing for terrorism and proliferation.

Second, Pakistan authorities mishandled the proceedings. Whatever steps Pakistan had taken before going to Paris, even though belated, were actually the demand of the Forum and initially all relevant players took a favourable view that the results of these steps should be allowed to emerge before considering any further action. Unfortunately, a premature celebratory tweet by a high government official was the unraveling of this goodwill. In fact, the tweet was construed, perhaps justifiably so, as the declaration of Pakistan’s victory over the US-led effort to put Pakistan on the watch-list. An element of defiance was clearly visible, even if it was not meant, for those who took it for that, wrote stories, especially those from Russia, claiming that Pakistan was no longer in the US camp and it has defeated US efforts to put it on the watch-list.

Third, the actual FATF resolution is still unclear. The foreign office spokesman has sort of confirmed that Pakistan would be formally placed on the grey-list in June. This is a curious development since the FATF public statement, the main instrument of classification of countries posing risks to AML/CFT, did not contain any reference to Pakistan. Advisor Finance has given contradictory statements, saying at one place that we are not there and at another that ‘we should consider being in the grey-list’. A clear and concise statement from him, as the subject of FATF was his responsibility, would have gone a long way in removing confusion in the public mind. More importantly, the Chinese Foreign Office spokesman has said that: ‘In the financial area for the counter terrorism, Pakistan has made enormous effort. We call on the relevant parties of the international community to view the efforts by Pakistan in objective and just way instead of politicising Pakistan with bias’. Besides refuting the propaganda of China abandoning Pakistan, this statement is a testimony to the fact that FATF was politicised.

The EU had also cleared Pakistan for GSP-Plus status in its biennial assessment. That speaks volumes about how the European Community as a whole views Pakistan

A frenzy was unleashed in the backdrop of Paris episode. The designs and machinations of those who wanted to disrupt the serenity and poise of Pakistani business and finance – particularly in the wake of the current political upheavals – were not entirely successful. The Indian media and some of their ilk in our ranks were predicting the arrival of disruptive forces engulfing Pakistan in the aftermath of FATF meeting. In the end, they proved nothing more than making a mountain out of a molehill. But we would hasten to say that while we have a breather we must continue to be on our guard. FATF has proved one fact, unquestionably, that our detractors would not hesitate to transform any or every forum to discredit Pakistan as a responsible member of the international community. Surprisingly, the effects on Pakistan media were no less frenzied. Many anchor persons were gloating in their ‘didn’t I tell you’ mode lamenting the isolation to which the country has been allegedly reduced. Indeed, the isolation brigade had a field day and went into overdrive. Some went so far as to condemn Pakistan for deceiving the world community and using terrorist groups as ‘instruments of foreign policy’.

Pakistan is not suffering from any isolation. It is a responsible country that provides the largest number of troops for UN peacekeeping missions. Its armed forces are commissioned, organised and trained on highest traditions of professional military service evolved over centuries. No other country has rendered more sacrifices for the free world, first, by standing up to the advance of communist forces and, second, against the War on Terror. Pakistan has lived in the eye-of-the-storm for the last forty years and it has survived many fashions and changing environments in global ideologies and politics. It knows how to protect its freedom and preserve its territorial integrity.

It is not a coincidence that the US sent its NSC Director Lisa Curtis to Pakistan in the backdrop of the Paris episode. Clearly, what happened was not a pleasant thing irrespective of who contributed, and in what measure. The nuanced statement from the US Embassy at the conclusion of her visit, was essentially positive as four-fifth of it expressed the US desire ‘to move toward a new relationship with Pakistan, based on a shared commitment to defeat all terrorist groups that threaten regional stability and security as well as on a shared vision of a peaceful future for Afghanistan’. There was an unqualified acknowledgment of ‘Pakistan’s considerable sacrifices in fighting terrorism’ and it also noted that ‘the US South Asia strategy represents an opportunity to work together to bring about a stable, peaceful Afghanistan which would enable the dignified return of Afghan refugees to their homeland’. Toward the close, the statement asked Pakistan to address American concerns on ‘the continuing presence of the Haqqani network and other terrorist groups within its territory’, and also used the occasion to convey ‘the international community’s long-standing concern about on-going deficiencies in Pakistan’s implementation of its anti-money laundering/counterterrorism finance regime’. The last part, undoubtedly, is a consistent position the US has maintained and Pakistan has a response to it too.

Just as the reverberations of FATF were sounded out, in a testimony on 27 February before the House Armed Services Committee, the Chief of CENTCOM, General Joseph Votel made a significant departure from the belligerent rhetoric so often voiced since the start of the Trump presidency, by appreciating the cooperation Pakistan has provided on the ground. He said he was frequently in touch with Pakistan army chief General Qamar Bajwa and they had uninhibited access to each other. General Votel and General Bajwa are contemporary military officers who have served in the proximity of Pak-Afghan border. Their chemistry seems to be gelling as a number of reports have emerged indicating that the two of them have evolved a basis to build mutual trust and confidence. In his testimony, General Votel, specifically underlined Pakistan’s border management efforts, including building barriers and walls to prevent cross-border movements, something that Afghan leadership and many American officials had opposed in the past.

The EU had also cleared Pakistan for GSP-Plus status in its biennial assessment. That speaks volumes about how the European Community as a whole views Pakistan. An overwhelming majority of more than 420 members of EU Parliament voted for giving extension to Pakistan in its GSP-Plus status. Surely, this is not the result of isolation but an active cooperation with states that matter for our economy and security.

As we said earlier, there is no room for complacency. We have to redouble our efforts to win over the most antagonistic of our detractors. We are not seeking enmity, rather we are working to build amity. The amending ordinance issued days before Paris meeting should be converted into an Act. The measures taken against Jamaat-ud-Dawah (JUD) and Falah-i-Insaniyat (FIF) should be reinforced and evidence collected to ensure to that they are prosecuted under the Anti-Terrorist Act, 1997. But if evidence is lacking, these bodies should be enabled to seek relief from UN Appellate Forums for their undue placement in the UNSC Resolution 1267.


  1. Pakistan should not give a damn about US, UK, Germany etc…. but confidently embrace the FATF grey/blacklist certification. If it means paying a little more money… be it

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