When Foreign Minister Khawaja Asif tweeted on February 21 about the Financial Action Task Force (FATF) failing to achieve consensus on grey listing Pakistan and the matter being put off for another three months, it seemed as if the imminent challenge had been delayed and everyone heaved a sigh of relief.
The relatively good news was short-lived. Over the following days, reports began to trickle in that Pakistan has been put on the grey list. However, when FATF’s press statement on the plenary came, Pakistan’s name was missing, which added to the confusion about the outcome with respect to the country. Then we were left to interpret the explanations from officials speaking in the background and unnamed sources, quoted by different news outlets, to understand what was the actual situation.
There have been different versions of what happened, but if you still feel confused, here is another attempt to explain it.
Is Pakistan on the grey list? What next for Pakistan?
Yes. Pakistan has been put on the grey list. This would, however, take effect from June. According to the normal process, a country is put on the grey list after ‘mutual evaluation’ and an action plan is also prepared when the deficiencies in its anti-money laundering and counter-terror financing regimes are identified. So when the country goes on the grey list, it knows what is being required of it. But, in Pakistan’s case that action plan has yet to be negotiated because the regular process was bypassed. Pakistan’s ‘mutual evaluation’ has to otherwise to commence this year and the process may take 18 to 24 months.
Now that the decision to grey list Pakistan has been taken, an action plan would be prepared and negotiated by FATF and Pakistan by June. Pakistani officials say that some of the concerns being expressed by the countries that nominated Pakistan, which include the US, UK, France and Germany, are unreasonable and unjustified. Therefore, that leaves the question about how far can Pakistan go to address the concerns. Pakistan does not have a choice. It has to successfully conclude the negotiations with FATF, otherwise blacklisting could be its fate. That’s the real pressure. In other words, if Pakistan was looking for ways to avoid the grey list ahead of the February plenary, it now has a harder job of escaping the blacklist at the June plenary.
The concerns started with the alleged non-implementation of UN Security Council sanctions against Hafiz Saeed, his associates, and his organizations, the Jamaat-ud-Dawa (JuD) and Falah-e-Insaniat Foundation (FIF). But when Pakistan belatedly and reluctantly moved on this count, after realizing that the world would not relent, world powers changed the goal posts. They are no longer satisfied with a presidential ordinance removing the discrepancy between the UN and national lists of proscribed groups and individuals. They are now pointing fingers at the integrity of Pakistan’s overall financial system, and the inadequate monitoring and regulatory mechanisms. Questions are being asked about how come the country has a low conviction rate on unlawful transactions. Moreover, they demand that Hafiz Saeed be put behind bars.
How did this happen? Why did our friends ditch us? The foreign minister’s tweet was premature. He celebrated it after a meeting of the working group that took place ahead of the plenary. It wasn’t fully his fault either. Mr Asif was then in Moscow and that was how the situation was reported to him. However, it was his call to go public with a tweet, little realizing that he was violating the diplomatic protocols of confidentiality at such meetings.
The Pakistani diplomats looking after the situation failed to realize that the issue would be again taken up at the plenary meeting that started on Feb 21 (Khawaja Asif had tweeted in the early hours of Feb 21). So when the plenary started and Pakistan’s nomination was discussed even our friends, China and the GCC, chose to stay silent because of their own interests. The motion was carried and Pakistan was picked for the grey list starting June.
China preferred silence for a couple of reasons. First, it did not deem it fit to fight a losing battle and, secondly it did not want to court controversy ahead of becoming the vice chair of FATF. China was elected to the position on Feb 23. The GCC, which is led by Saudi Arabia, meanwhile was also mindful of the upcoming full FATF membership of the Kingdom in June.
China and Saudi Arabia are normally considered Pakistan’s ‘best friends’ on the world stage. But the fact that foreign policy is driven by narrow views of self-interest was on full display at the FATF plenary.
The Chinese sought to downplay the embarrassing situation for the “iron brotherhood” and the relationship that boasts to be “higher than the Himalayas and deeper than the deepest sea in the world, and sweeter than honey”. When specifically asked about China not helping Pakistan at FATF, Chinese Foreign Minister Spokesman Lu Kang, at the media briefing in Beijing on Feb 27, said: “In recent years, Pakistan has made important progress in actively strengthening financial regulations to combat terror financing. China highly recognizes that and hopes all relevant parties of the international community could arrive at an objective and fair conclusion on that.” He clearly avoided saying why the Chinese did not stand up for Pakistan at the FATF meeting, their kind views about Pakistan, notwithstanding.
It is now a reality that Pakistan is on the grey list. There can be a long debate about the implications of this development. The officials seem dismissive, they probably want to put on a brave face after the Paris fiasco, but what needs to be watched out for now is whether or not the government and its institutions learn their lesson or not. The National Security Committee has rightfully called for a ‘re-calibration of the foreign policy’. One can only hope that if this exercise is ever going to be taken it would be a little more than window-dressing.
The writer is a freelance journalist based in Islamabad mamoonarubab@gmail.com
The relatively good news was short-lived. Over the following days, reports began to trickle in that Pakistan has been put on the grey list. However, when FATF’s press statement on the plenary came, Pakistan’s name was missing, which added to the confusion about the outcome with respect to the country. Then we were left to interpret the explanations from officials speaking in the background and unnamed sources, quoted by different news outlets, to understand what was the actual situation.
There have been different versions of what happened, but if you still feel confused, here is another attempt to explain it.
Is Pakistan on the grey list? What next for Pakistan?
Yes. Pakistan has been put on the grey list. This would, however, take effect from June. According to the normal process, a country is put on the grey list after ‘mutual evaluation’ and an action plan is also prepared when the deficiencies in its anti-money laundering and counter-terror financing regimes are identified. So when the country goes on the grey list, it knows what is being required of it. But, in Pakistan’s case that action plan has yet to be negotiated because the regular process was bypassed. Pakistan’s ‘mutual evaluation’ has to otherwise to commence this year and the process may take 18 to 24 months.
Now that the decision to grey list Pakistan has been taken, an action plan would be prepared and negotiated by FATF and Pakistan by June. Pakistani officials say that some of the concerns being expressed by the countries that nominated Pakistan, which include the US, UK, France and Germany, are unreasonable and unjustified. Therefore, that leaves the question about how far can Pakistan go to address the concerns. Pakistan does not have a choice. It has to successfully conclude the negotiations with FATF, otherwise blacklisting could be its fate. That’s the real pressure. In other words, if Pakistan was looking for ways to avoid the grey list ahead of the February plenary, it now has a harder job of escaping the blacklist at the June plenary.
Pakistan does not have a choice. It has to successfully conclude the negotiations with FATF, otherwise blacklisting could be its fate. That's the real pressure
The concerns started with the alleged non-implementation of UN Security Council sanctions against Hafiz Saeed, his associates, and his organizations, the Jamaat-ud-Dawa (JuD) and Falah-e-Insaniat Foundation (FIF). But when Pakistan belatedly and reluctantly moved on this count, after realizing that the world would not relent, world powers changed the goal posts. They are no longer satisfied with a presidential ordinance removing the discrepancy between the UN and national lists of proscribed groups and individuals. They are now pointing fingers at the integrity of Pakistan’s overall financial system, and the inadequate monitoring and regulatory mechanisms. Questions are being asked about how come the country has a low conviction rate on unlawful transactions. Moreover, they demand that Hafiz Saeed be put behind bars.
How did this happen? Why did our friends ditch us? The foreign minister’s tweet was premature. He celebrated it after a meeting of the working group that took place ahead of the plenary. It wasn’t fully his fault either. Mr Asif was then in Moscow and that was how the situation was reported to him. However, it was his call to go public with a tweet, little realizing that he was violating the diplomatic protocols of confidentiality at such meetings.
The Pakistani diplomats looking after the situation failed to realize that the issue would be again taken up at the plenary meeting that started on Feb 21 (Khawaja Asif had tweeted in the early hours of Feb 21). So when the plenary started and Pakistan’s nomination was discussed even our friends, China and the GCC, chose to stay silent because of their own interests. The motion was carried and Pakistan was picked for the grey list starting June.
China preferred silence for a couple of reasons. First, it did not deem it fit to fight a losing battle and, secondly it did not want to court controversy ahead of becoming the vice chair of FATF. China was elected to the position on Feb 23. The GCC, which is led by Saudi Arabia, meanwhile was also mindful of the upcoming full FATF membership of the Kingdom in June.
China and Saudi Arabia are normally considered Pakistan’s ‘best friends’ on the world stage. But the fact that foreign policy is driven by narrow views of self-interest was on full display at the FATF plenary.
The Chinese sought to downplay the embarrassing situation for the “iron brotherhood” and the relationship that boasts to be “higher than the Himalayas and deeper than the deepest sea in the world, and sweeter than honey”. When specifically asked about China not helping Pakistan at FATF, Chinese Foreign Minister Spokesman Lu Kang, at the media briefing in Beijing on Feb 27, said: “In recent years, Pakistan has made important progress in actively strengthening financial regulations to combat terror financing. China highly recognizes that and hopes all relevant parties of the international community could arrive at an objective and fair conclusion on that.” He clearly avoided saying why the Chinese did not stand up for Pakistan at the FATF meeting, their kind views about Pakistan, notwithstanding.
It is now a reality that Pakistan is on the grey list. There can be a long debate about the implications of this development. The officials seem dismissive, they probably want to put on a brave face after the Paris fiasco, but what needs to be watched out for now is whether or not the government and its institutions learn their lesson or not. The National Security Committee has rightfully called for a ‘re-calibration of the foreign policy’. One can only hope that if this exercise is ever going to be taken it would be a little more than window-dressing.
The writer is a freelance journalist based in Islamabad mamoonarubab@gmail.com