What is FATF? why FATF is important for Pakistan ?

 What is FATF? why FATF is important for Pakistan ?

FATF and Pakistan

Financial action task force (FATF) also known by its French name Groupe d'action financière, is an intergovernmental body established in 1989 on the initiative of G-7 countries and it’s headquarter is in Paris, France. It is a body to combat money laundering initially and later on terror financing and other potential threats to international financial system were included in 2001. Structure of FATF consists of 39 members including two international institutions the European Commission and Gulf Cooperation Council respectively. Pakistan is not a member state of FATF, instead it is a FATF associate Asia Pacific group (APG) member on money laundering.

Paris based global watchdog to curb money laundering and terror financing will review performance of Pakistan on action plan in its virtual session from October 21 to 23.

Pakistan was placed on a grey list of FATF in June 2018 and given 27 action plan points to prevent from going into blacklist by the end of 2019, but timeline was extended due to coronavirus and effective foreign policy of the current government.

The report said, 21 action points related to money laundering have been completed and complied. Remaining six point’s progress is twenty percent related to terror financing.

The international cooperation review group of FATF has acknowledged the Pakistan has complied with 21 points completely, the report said.
Financial Action Task Force 

In July, Pakistan has passed four FATF related bills from parliaments lower and upper house to avert blacklist. In September, parliament joint session passed 15 bills as required by FATF to match international standards.

Furthermore, it is important to move from grey list to white list because international financial institutions International monetary fund (IMF), Asian development bank (ADB), World Bank (WB) and European Union (EU) deny financial aid. It is becoming difficult for a country like Pakistan which is already in a precarious economic condition.

In February, Prime minister Imran Khan reiterated publically, if we will not comply with FATF requirements and blacklisted, our economy will be destroyed due to inflation and devaluation of rupee.

It is necessary for a country like Pakistan to comply with the FATF standards. Otherwise, there is possibility that FATF will place Pakistan on blacklist with Iran and North Korea. 



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