FATF session: Why it’s important for Pakistan to get out of the ‘grey list’?

As the Financial Action Task Force (FATF) virtual three-day plenary session is scheduled to begin from October 21 (today), all eyes are set on the Paris-based watchdog over its decision regarding Pakistan.

Whether Pakistan would stay on the grey list is vital for the country, especially if taking into account the economic implications of the body's decision.

It is pertinent to inform that the FATF put Pakistan on its list in 2018, even before this, Pakistan has been part of the list from 2013 to 2016 but was removed from the list due to the country's satisfactory performance.

Meanwhile, a federal government spokesman while talking to a private channel, said that it is important for Pakistan to get out of this list because investors at the international level consider investing in Pakistan a risk.

“For example, if a country is lending to you or doing business, it will charge higher interest rates, which will increase the economic burden on Pakistan. Getting off the list is our main problem right now," the spokesperson said.

In this regard, the FATF meeting held in Paris in February this year and earlier in October 2019 was very important but in both these meetings, Pakistan could not get out of the grey list.

As per details, Pakistan would need the support of at least 12 of the 39 members of the FATF to be removed from the list at this time.

Concerns however remain as in its September 2020 "Mutual Evaluation of Pakistan" report the Asia-Pacific Group (APG) noted that only one technical compliance deficiency has been re-rated as fully compliant.

The FATF gave Pakistan a four-month grace period in February 2020 this year to complete its 27-point action plan against ML&TF while noting that Pakistan had delivered on 14 points but missed 13 other targets.