ISLAMABAD: Minister for Industries and Produc­tion Hammad Azhar on Friday acknowledged that future timelines of the Financial Action Task Force (FATF) action plan were challenging, but there was no possibility of Pakistan being blacklisted.

Addressing a press briefing a day after the FATF decided to keep Pakistan on its grey list till June, Mr Azhar said blacklisting was no more a threat because Pakistan had made significant progress in meeting the conditions.

“As you have seen, the FATF itself was saying that we are 90 per cent close to achieving this goal,” he said. “I want to assure the nation that Pakistan has successfully avoided blacklisting.”

The minister, who is also chairman of the FATF Coordination Committee, said Pakistan’s target was now to achieve all 27 points in the action plan and convey to the world that the country’s financial system was on a par with international standards.

As pointed out by the FATF that Pakistan has met 24 of the 27 requirements, the minister expressed the confidence that the remaining three points would also be fulfilled. “A lot of work has been done on the three points in which we are partially compliant and I see that we are close to being largely compliant in these areas,” Mr Azhar added.

The minister said Pakistan was perhaps the only country in the world that was under FATF’s dual scrutiny.

“It was decided that Pakistan will remain under dual scrutiny because the Mutual Evaluation Report process was also ongoing,” the minister said, praising the government departments for their hard work.

“When the coronavirus pandemic hit, Pakistan had the option not to report — an option exercised by some countries — but we took advantage of that time and continued with the reporting,” the minister said, adding that “the result is in front of you”.

The minister lauded the efforts of all state organs and gave them the credit of meeting the international body’s requirements in combating money laundering and terror financing.

“Pakistan achieved exemplary progress despite a very tough action plan, tight timelines and the Covid-19 pandemic,” Mr Azhar said.

The three FATF requirements that Pakistan has failed to achieve so far are related to terror financing investigations. One of the requirements is to demonstrate that terrorism financing (TF) investigations and prosecutions target persons and entities acting on behalf or at the directive of the designated persons or entities.

The second is demonstrating that TF prosecutions result in effective, proportionate and dissuasive sanctions while the third condition is to ensure effective implementation of targeted financial sanction against all entities and individuals listed in the United Nations Security Council (UNSC) resolutions 1267 and 1373.

However, a serious challenge for the government to meet these three requirements was implementing the FATF criteria for 84 groups and organisations proscribed by the interior ministry.

Many of these groups are listed in the UNSC resolutions 1267 and 1373, whereas enforcing international laws on individuals listed in the fourth schedule of the Anti-Terrorism Act, also called proscribed persons, was a daunting task.

The finance ministry, on the other hand, has said Pakistan has achieved all the 10 actions pertaining to the financial sector and border controls.

However, six out of the eight actions related to terrorism financing investigations and prosecutions have been achieved and one action related to ‘targeted financial sanctions’ has to be addressed.

The FATF Coordination Committee includes representatives of the Ministry of Foreign Affairs, National Counter Terrorism Authority, Financial Monitoring Unit, National FATF Secretariat and other relevant departments.

Pakistan was included in the FATF grey list in June 2018 for failing to meet international obligations related to terror financing and money laundering.

The other countries in the grey list are Albania, Botswana, Cambodia, Ghana, Mauritius, Myanmar, Nicaragua, Panama, Uganda and Zimbabwe, whereas the recent addition in the list are Burkina Faso, the Cayman Islands, Morocco and Senegal. Barbados and Jamaica have opted to defer reporting due to the Covid-19 pandemic.

Only two countries — Iran and North Korea — are on the FATF blacklist.

Published in Dawn, February 27th, 2021

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