• PM credits civil-military leadership; Bilawal congratulates nation
• Hina hopes exit will provide much-needed boost to economy
• Myanmar joins Iran, N. Korea on FATF’s blacklist

ISLAMABAD: After a tough grind of almost four and a half years, Pakistan finally came out of an international watchdog’s so-called “grey list” of countries that do not take full measures to combat money laundering and terrorism financing.

“Pakistan worked through two concurrent action plans and completed 34 action points to remove strategic deficiencies in anti-money laundering and combating financing terror (AML/CFT) regime,” Raja Kumar, the president of the Financial Action Task Force (FATF), announced at a news conference on Friday in Paris, where the watchdog is based.

“Pakistan is therefore no longer subject to the FATF’s increased monitoring process,” he said.

He said a FATF team’s on-site visit to Pakistan at the end of August verified that relevant reforms were in place for the security and sustainability of the financial systems and noted high-level commitment to sustain these reforms and continue making progress in upgrading AML/CFT along international standards.

The FATF welcomed “Pakistan’s significant progress in improving” its anti-money laundering and counter-terrorism financing policies.

Mr Kumar acknowledged that Pakistan had strengthened the effectiveness of its AML/CFT regime and addressed technical deficiencies to meet the commitments of its action plans on strategic deficiencies that the FATF identified in June 2018 and June 2021, the latter of which was completed ahead of the deadlines, encompassing a total of 34 action items.

The FATF put Pakistan on its grey list in June 2018. Being on the watch list can scare away investors and creditors, hurting exports, output and consumption, and can make global banks wary of doing business with a country.

Friday’s announcement means Pakistan will no longer be subject to increased monitoring by the Paris-based watchdog.

The decision was immediately welcomed by Prime Minister Shehbaz Sharif. “Pakistan exiting the FATF grey list is a vindication of our determined and sustained efforts over the years. I would like to congratulate our civil and military leadership as well as all institutions whose hard work led to today’s success. Aap sab ko bohat bohat mubarak,” he tweeted.

The premier particularly commended the role of Foreign Minister Bilawal Bhutto-Zardari, Army Chief Gen Qamar Javed Bajwa and their teams and all political parties for “putting up a united front to get Pakistan out of the grey list”.

“Congratulations to the people of Pakistan,” Mr Bhutto-Zardari tweeted.

At the news conference in Paris, Minister of State for Foreign Affairs Hina Rabbani Khar said: “We want to be seen as a responsible and active member of the international community that is well aware of its international obligations.”

The FATF plenary discussed a report prepared by its team who completed its visit to Pakistan in the first week of September.

Ms Khar said that as a result of sustained efforts during the last four years, acknowledgement of unwavering political commitment and the successful on-site visit, the FATF “fully recognised completion all substantive, technical as well as procedural requirements of Pakistan’s 2018 and 2021 action plans”.

“This would not have been possible without complete national consensus across the political spectrum,” she said.

She said that in many areas, Pakistan was now “more compliant with global standards than most of the developed countries” and hoped this exit from the grey list would give a much-needed boost to Pakistan’s economy and increase its economic and financial engagement with the outside world and attract foreign investment.

The United States also recognised Pakistan’s progress. “We encourage Pakistan to continue its efforts to strengthen its anti-money laundering and counter financing of terrorism regimes,” a State Department spokesperson said.

The grey list is composed of countries with a high risk of money laundering and terrorism financing but which have formally committed to working with the task force to make changes.

The FATF is made up of 37 member countries, including the United States, and two regional groups, the Gulf Cooperation Council and the European Commission.

The watchdog has also added Myanmar to its blacklist, which also includes Iran and North Korea.

Anwar Iqbal in Washington also contributed to this report

Published in Dawn, October 22th, 2022