Pakistan not on FATF grey-list

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PakistanToday
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  • FATF spokesperson says organisation not responsible for media reports pertaining to Pakistan’s inclusion to the list 
  • List includes Ethiopia, Iraq, Serbia, Sri Lanka, Syria, Trinidad and Tobago, Tunisia, Vanuatu and Yemen.
  • Finance adviser says Pakistan won’t be significantly affected by the list as fundamentals of economy were strong

PARIS: In spite of the media reports regarding Pakistan’s inclusion into the Financial Action Task Force (FATF) grey-list, Pakistan has not been included in the money-laundering watchdog’s list that pertains to countries with strategic deficiencies’.

The countries in the list issued by the FATF on February 23 include Ethiopia, Iraq, Serbia, Sri Lanka, Syria, Trinidad and Tobago, Tunisia, Vanuatu and Yemen.

Neither public statement–that contains Iran and North Korea– issued by the FATF nor the statement pertaining to the outcomes of the plenary meeting features Pakistan’s name.

However, it remains ambiguous if Pakistan would be included in the list, as a statement on the website of the watchdog says: “A number of jurisdictions have not yet been reviewed by the FATF. The FATF continues to identify additional jurisdictions, on an on-going basis, that pose a risk to the international financial system.”

Earlier in the day, there were reports of Pakistan’s inclusion in the list, with Reuters quoting sources that Pakistan has been placed on the FATF list. “A global money-laundering watchdog [FATF] has decided to place Pakistan back on its terrorist financing watchlist,” the news agency said.

After the conclusion of the task force’s plenary session, the FATF spokesperson added that the FATF was not responsible for reports which claimed Pakistan’s inclusion in the list. She said: “A final decision will come after the meeting reviewing the matter concludes.

The FATF session in Paris, which concluded on Friday, was being held to review proposals that include putting Pakis­tan back on a list of countries which have failed to prevent terrorist financing. The United States (US) and Britain had put forward a motion to place Pakistan on the FATF terrorist-financing watch list. If adopted, the resolution would place Pakistan on the FATF’s grey-list.

Responding to the reports, Interior Minister Ahsan Iqbal denied the report, saying that the official FATF decision still has to come, therefore “we should not speculate till official statement is released”.

‘STRONG ECONOMY’:

Meanwhile, Adviser to Prime Minister on Finance Miftah Ismail said that Pakistan won’t be significantly affected by being put on the list as fundamentals of the economy were strong.

“Nothing is going happen before June…[but even then]nothing really will happen to Pakistan. It is not a big issue,” he told a local media outlet.

The adviser said that Pakistan was placed on the list between 2012 and 2015 too but the stock market still grew by three per cent.

Ismail added that Pakistan already has strong anti-money laundering measures in place.

PAKISTAN CONCERNED OVER THE MOVE:

Meanwhile, Pakistan Foreign Office Spokesperson Muhammad Faisal had said that a request to include Pakistan in the grey-list was made earlier in January by the United States and Britain. “Pakistan has serious concerns over the motion moved by US and UK at the Financial Action Task Force to put the country on the grey list,” the FO spokesperson had added.

The reservations tabled before the FATF are those of America, the spokesperson added. He specified that Pakistan has already taken action against most of the reservations, including implementing the National Action Plan (NAP).

Separately, in the weekly news briefing, the FO spokesperson expressed his surprise over the recent US intelligence reports that Pakistan is drifting away from Washington.

The spokesperson pointed out that the US took several unilateral steps in recent months which have actually impacted the relationship. It is for the US to rebuild the trust.

Regarding the motion moved by the US and the UK at the FATF to put the country on the greylist, he pointed out that most of the concerns by the US regarding deficiencies in anti-money laundering and combatting the financing of terrorism had already been addressed in 2015 when Pakistan got an exit from the greylist.

Earlier this week, Foreign Minister Khawaja Asif had said that Pakistan had been given a three-month reprieve before being placed on the list, which could hamper banking and hurt foreign investment.

Asif had tweeted that Pakistan’s “efforts have paid (off)” during a Tuesday meeting on the US-led motion, suggesting there was “no consensus for nominating Pakistan”.

He had also suggested the meeting proposed a “three months pause” and asked for the Asia Pacific Group, which is part of FATF, to consider “another report in June”.

“Grateful to friends who helped,” Asif had added.

On the same day as Asif’s tweet, The Wall Street Journal had named China, Turkey and Saudi Arabia as the ‘friends’ who had come forward to rescue Pakistan, saying that the three countries had blocked the US’s motion to put Pakistan on the list.

Following the remarks of the FM, the US State Department had dismissed the claims made by Asif that it had granted the country a reprieve over a watch list vote, stating that it has yet to take a decision on the matter.

IMPACT ON PAKISTAN:

Pakistani officials and diplomats say that being put on the FATF watchlist could deal a blow to Pakistan’s economy, making it harder for foreign investors and companies to do business in the country.

Military successes against militants and massive Chinese infrastructure investments have restored some vim to an economy hobbled by a long-running religious insurgency and wrecked by the 2008/09 global financial crisis.

Officials are aiming for economic expansion to hit six per cent this fiscal year (July-June) and Prime Minister Shahid Khaqan Abbasi’s ruling party will want to avert a slowdown in the lead up to a general election due in about six months.

Being placed on the FATF watchlist carries no direct legal implications, but brings extra scrutiny from regulators and financial institutions that can chill trade and investment and increase transaction costs, according to experts.

Mike Casey, a partner at law firm Kirkland & Ellis in London, said being put back on the grey list would heighten Pakistan’s risk profile and some financial institutions would be wary of transacting with Pakistani banks and counterparties.

“Others might elect to avoid Pakistan altogether, viewing the legal risks associated with doing business there to outweigh any economic benefits,” he said.

According to the Interior Minister Ahsan Iqbal, it would be counterproductive to put Pakistan on the watch list as it would hurt its capability to fight terrorism.

“This time (the effects) would be even greater because there are other pressures on Pakistan,” political commentator and retired Lt Gen Talat Masood told Arab News, speculating on what might happen should Pakistan be included on the watch list again.

“Pakistan’s balance-of-payments position is very adverse at the moment and internal stability is not good. It will have a greater impact than it had last time,” he continued, urging the government to take “appropriate measures” to combat the imminent danger of sanctions.

Senior economist Dr Syed Nazre Hyder described the potential impact of Pakistan’s inclusion on the watch list — should it happen — as “near lethal.” He pointed out that the cost to banks’ customers will rise, investors in the international capital market would request a much higher rate of return from Pakistan, and multilateral financing organizations would add risk premiums on any money borrowed.

Furthermore, financial experts fear the International Monetary Fund (IMF) may reject any loan extension Pakistan might request as a bailout to curb its widening trade deficit or offer a new deal with stricter guidelines dictated by the US and the European Union.

“Pakistan will need a loan to pay off its debt burden,” Hyder told Arab News. “If it’s included on the list, the country will face a serious challenge sourcing funds for repayment leading to the possibility of default. This would cripple Pakistan economically.”

 

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35 COMMENTS

  2. For long we’ve harbored terrorist under the garb of revolutionaries. Maybe this is a wake-up call before we hand over our economy to China.

  3. Pakistan was is and will a terrorist country whose foreign policy is based on India. Poor paki brothers why not do some research to grow economy instead of forming terror.

        • Lol you don’t even know the basics kiddo? Pakistan came into being on 14th Aug and endia on the 15th. Who’s the elder obviously eh?

          Stop being so jealous and stop poking your nose in our matters. Shoo!

        • We cut India, bharat or whatever you call it and made Pakistan and the Hindus could not do shhhhiiiittt about it. ?

      • By that same token, will Pakistan also accept the costs for killing 100s & 1000s of children in India and Afghanistan ? The jihadis who killed children in Peshawar were the ones trained & brainwashed by ISI mullahs. If you blame India or Afghanistan for the attack, shouldn’t equal blame rest with the ISI which created these monsters in the first place to please the US ? It may very well have been an outside act but its definitely not the first time when children were killed. When you care for Pakistani children, shouldn’t you have the same concerns for other children as well? Or are the childrens of non-Pakistanis or non-Muslims not worthy of living a safe life?

  6. China allowed Pakistan to slip into this list so that Pak is left with no choice but to increase dependence on China by taking more loans at higher interest rates..

  7. India is sending rockets to the Moon and Mars…Pakistan is sending terrorists to India….Don’t worry Pakistan…If US stops giving you alms you can always take your begging bowl to China…

  8. Very soon Pakistan will become a Chinese colony, they will be treated the same way Britisher treated .. Pakistanis will work for chinese companies, pakistani babies will look more like chinese under chinese influence

  9. Pak shd introspect over this.all civil society orgs and liberal Pakistanis shd pressurise military and isi to reduce their debilitating hold on Pakistani state and allow the civilian govt to have a greater say in policy matters…otherwise nothing can stop pak from going down the north Korean way

  10. This is what happens when you pull more than your weight. This is a consequence of taking Panga with India which is 10 times bigger and stronger. Some times I wonder what our generals and civilian leaders are drinking. On what basis they think they can fight with giants like India and US? At least look at your economy and country. People do not have food to eat. Even Pak sports people are failing due to physical weaknesses. Many kids have no food to eat, schools nor toilets. Every general has a house in western world and their kids are already in US or Europe. No wonder they do not care for common Pakistani child. Only their inflated Ego matters. I hate My Pak army. They brought us to this stage.

  11. pakistan will suffer a little bit BUT V WILL NEVER FIGHT FOR AMERICA WITH NO CREDIT, NATION HAS CONSENSES ON THIS ,USA DEFEATED IN AFGHANISTAN, WILL NEVER SUCCED WITHOUT RECOGNISING PAK SACRIFICES. PAKISTAN ZINDAABAD

    • your leaders —when they go to US to beg….also clean toilets there and take tips….”Never fight for America”…grow up ….madrasas have made you guys dumb….

  12. Even if PK is included in the list, once this corruption riddled government is gone, we’ll strengthen controls and improve risk profile and request a review. Its a US UK move to burden us.

  13. Is or was India ever a asecular country . I am reading lots of venom and atrocities at religious minorities and low cast poor in India.

    • Yes India is a secular country and was all along the history. Stop reading the lousy madarsa reports and read real news from reputable news papers. Its funny that you can’t read about atrocities on pakistani minorities and poor but red about well-living Indian minorities:)

      • Endia and secular? Buahahaha! “well living minorities” in endia? Buhahahahaha! You are funny dude. Quite cheap and surely ugly but hell funny!

        First decide what’s the name of your country? Is it endia, hindustan or bharat? Oh and remember we aren’t like the dumb brained, burqa wearing, slaves muslims of your country we are Proud Pakistanis, highly educated professionals living an awesome independent free life in our country! So stop being so envious.

  14. this is the failure of diplomates of our country & especially nawaz shareef who had the portfolio of foreign ministry during his tenure but the worst circumstances you r mentioning here is so ridiculous,
    I think u r an Indian and just pretending as a Pakistani , that’s why showing the things which r either not exist or exist in low scale like other countries of south asia including ur’s favourite “GIANT INDIA” , plz dnt elobrate those things which r only find on canvas of Indian media,

  15. Endians and their petty jealousy and envy lol! Always poking their noses in each and every Pakistan related page. Whether its a Pakistani tourism page, military, economical or political – the first comment will be by an ugly indian spreading fake envious venom.

    Gosh how much faarigh you people are! how much Raw pays you to do this eh? And seriously, fake id’s are so obvious. Just by putting a fake muslim name won’t make you a Pakistani or even Afghani. How about you idiots do something about the horrible problems in your country like no toilets for 70% of your ugly population, open daylight rapes on a daily basis, killing of minorities, worshiping cow and torturing dalits and females etc to name a few. Stop being so crazily obsessed with our country/matters and start minding your own business.

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