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October 26, 2020

A little bit of sun

Editorial

 
October 26, 2020

While the grey clouds which have hung over Pakistan since the Financial Action Task Force placed it on its grey list continue to linger, there is some evidence that rays of sunlight are beginning to shine through. Although, disappointingly the FATF has ruled at its three-day meeting that Pakistan will not for now be removed from the grey list, it has also said that Pakistan has completed 21 of the 27 tasks given to it by the FATF and that the country now needs to complete the rest. The Pakistan government has responded by saying it is close to reaching this target. The FATF has set February 2021 as the date by which these tasks need to be completed and has also suggested that there will be a physical visit of the country before any change is made in Pakistan's status. This again, is welcome news. Pakistan needs to demonstrate for the world that, as the FATF mentioned, it has indeed done well in dealing with money laundering and terror-financing.

The next steps will be important. Banks are expected to tighten the procedures still further regarding sources through which money can enter or leave the country. The question of Pakistan's placement on the FATF grey list has lingered now for some years. It is time we once again enter the white zone, where many countries stand. This would help Pakistan strengthen its economy and build its systems to the benefit of people all across the country as well as boost business confidence in the country. We badly need such confidence. At the moment, business is continuing to go down with investment sinking and a consequent shortage of foreign reserves being experienced. The change has to come as quickly as possible. We hope that by next year, this will indeed be the case. The FATF has held out a carrot in exchange for the country making the remaining changes still required.

While the economic managers of the country deserve to be pleased, real success can come only when the country is off the grey list and back on the white list. It is creditable that it is coming closer and closer to achieving this task despite the fact that there are countries in the world with powerful economies who would like to see it on the black list. This is now unlikely to happen. We hope the worst fears have been removed but there's still more that needs to be done and this must be achieved as quickly as possible, along with a determination which can be demonstrated within governance to tackle terrorism and end the support for it by freezing assets used by these groups to carry out the acts of violence.