The setback at FATF


Shahid M Amin
DESPITE all claims made by our officials about this week’s meeting in Paris of the Financial Action Task Force (FATF), it is clear that Pakistan has suffered a setback. There has not only been clumsy diplomacy but more so it is a case of systemic failure by government, media and civil society, over a period of time, to take effective action against terrorists, including financing of terrorist outfits. FATF is the global standard setting body for anti-money laundering (AML) and combating the financing of terrorism (CFT). Based in Paris, with 39 members, it is an inter-government organization founded in 1989 on the initiative of G7 to develop policies to combat money laundering. In 2001, its mandate was expanded to include terrorism financing. It monitors progress in implementing FATF decisions through ‘’mutual evaluations” of member countries. Two of its members are regional bodies, Gulf Cooperation Council (GCC) and European Commission (EC). Apart from GCC, Muslim member countries are Turkey and Malaysia, while Saudi Arabia is an Observer.
Let us recall the proceedings of this particular FATF meeting. Pakistan’s Foreign Minister Khwaja Asif, prematurely, claimed a diplomatic victory on 20 February through a tweet that there had been no consensus on US-led motion to put Pakistan on the watch list. The proposal of USA and UK, backed by France and Germany, to put Pakistan on the Grey List was opposed by China, Saudi Arabia and Turkey. Asif said there was no consensus on the US proposal and another report would be considered in June: in other words, Pakistan had won a reprieve of three months. This was seen as a success of Pakistani diplomatic efforts.
Asif’s tweet might well have prompted the US to circumvent rules in order to review the issue. In the second meeting, only Turkey supported Pakistan, while China and Saudi Arabia kept aloof. The US had evidently persuaded these two countries to change their stance. A Pakistani official confirmed that FATF had decided to put Pakistan on the Grey List i.e. its terror financing watch-list of countries that financially aid terrorism, with effect from June 2018. FATF would require Pakistan to submit an Action Plan in May in order to be removed from the list. After FATF considers the Action Plan, it will formally decide Pakistan’s position on Grey List. In case FATF remains dissatisfied, it can even put Pakistan on its Black List, which is far worse.
Pakistan was on the Grey List from 2010 to 2015, after which its name was taken off from the list. According to acting Finance Minister Miftah Ismail, even during this period, Pakistan had signed agreements with IMF and issued sovereign bonds in international capital markets. In other words, being on the Grey List again would not make much of a difference in real terms. However, it is a stigma on the country’s international face. The FATF action is clearly a part of Trump’s pressure tactics on Pakistan. Even the change of procedures in FATF is a result of US pressure.
In the context of foreign policy, we can draw some conclusions. Firstly, our diplomacy led by Asif should have been more effective but circumspect, and we should have avoided premature boasting. Secondly, the Paris meeting is food for thought for those who have been talking about taking on a super power, without understanding the extent of its ability to harm us. Thirdly, FATF proceedings showed the extent of our isolation in the international arena, mainly due to the perception that we are not doing enough to eradicate terrorism, which includes financing of terrorist outfits. While shortly before the FATF meeting, action was taken against Hafiz Saeed and his dummy organizations, it was doing too little too late. Fourthly, we need to ponder why we were let down by two of Pakistan’s closest friends. How was it that, at the end, only Turkey stood up for us? What happened to China, Saudi Arabia, GCC, and Malaysia? And why did Russia support the American position at FATF though it is at daggers’ drawn with US? Those in Pakistan who fancy Russia as a strategic ally need a reality check.
However, the real problem concerning terrorism lies inside Pakistan. For too long, we allowed Islamist extremism and terrorism to rise in our country. We made artificial distinctions between good and bad Taliban. Nawaz Sharif held out vainly for talks with Taliban, egged on by opposition leaders including Imran Khan and Fazlur Rahman, and kept delaying military action until much harm had already been done: the Peshawar school horror more or less forced his hand. No doubt, our armed forces have done very well against terrorists, but the corresponding action on the civilian front under National Action Plan has been lethargic. Brainwashing continues in religious circles, in numerous mosques and seminaries, producing new crops of terrorists.
Then there is the strange love affair some of us have with Hafez Saeed. His sympathisers need to answer the question: what exactly has he achieved through militancy? Has Kashmir been liberated or India weakened? All that his efforts have produced is stamping the image of terrorism on Pakistan’s face and even on the Kashmiri political struggle for liberation. India has been able to divert world attention from its atrocities by linking the freedom struggle with Islamist terrorism, fed by cross-border infiltration, while citing Saeed as the living proof. World opinion at present is solidly against terrorism, and this explains our isolation at Paris. Things would have been very different had we taken tough action long ago against extremists like Saeed.
— The writer served as Pakistan’s Ambassador to Saudi Arabia, Soviet Union, France, Nigeria and Libya.

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