IT seems that, despite the seriousness with which Pakistan had committed itself to complying with FATF standards, the global financial watchdog is still not convinced of its progress and requires more action on some of the targets that it says have not been achieved.

For now, then, Pakistan remains on the grey list.

The taskforce has indicated that Pakistan will have to satisfactorily address all 27 points of the action plan by June, otherwise stricter action could be taken. For a while, there were government officials who were hopeful that Pakistan would be removed from the grey list, although some ministers did strike a cautious note, reminding people that the outcome of the February talks was not a foregone conclusion. It turns out that the optimists did not win the day.

Certainly, the task before Pakistan has been gargantuan, and the fact that it has still met several FATF conditions should be appreciated. But the difficult part is clearly not over; the top tiers of government must now take a hard, honest look at all the hurdles in the way of meeting the global body’s expectations and ensure that these are removed quickly.

A perception had been created that the arrest of UN-designated terrorist Hafiz Saeed, would pave the way for Pakistan to be removed from the list but this has not happened.

Clearly, the gaps in the implementation of the action plan have overshadowed the progress that the government wished to project. Now the country needs, and deserves, clarity on exactly what is happening on the FATF front.

The FATF statement released after the deliberations in Paris contains language more specific than did previous statements.

It says Pakistan needs to make “significant and sustainable progress especially in prosecuting and penalising” terror financing, and should such progress not be made, the watchdog would take action “which could include the FATF calling on its members and urging all jurisdiction to advise their [financial institutions] to give special attention to business relations and transactions with Pakistan.”

The question for the country’s economy in the next four months is: what does “special attention” mean here? What are its ramifications?

Despite having touted all the progress that has been made thus far, including a high-profile arrest on terror-financing grounds, and despite that fact that Pakistan enjoys the confidence of the US in delivering a peace plan for Afghanistan and has an ally in China that is the president of the watchdog body, it is obvious the danger of blacklisting has not gone away, and the authorities are still struggling to implement the entire action plan.

The stakes are higher, as are the challenges confronting the government. It is time to for the government to make clear where the operational difficulties lie and expedite its efforts to satisfy FATF demands. Without this, Pakistan’s progress will never be viewed as enough.

Published in Dawn, February 23rd, 2020