In good news for Pakistan, the country's name has been struck off the dreaded 'grey list' of the Financial Action Task Force (FATF), a classification that made it very difficult for the South Asian nation to get international aid for issues like disaster management.
The global terrorism watchdog FATF added Pakistan to the list four years ago based on allegations of terror financing and money laundering. Now, the global body has found that Pakistan has worked on strengthening safeguards against money laundering. The global watchdog has also stated that Pakistan has made efforts in combating terror financing as well as on overcoming technical difficulties.
In a statement, the Paris-based organization announced that as of October 21 "Pakistan is no longer subject to FATF's increased monitoring process; to continue to work with APG (Asia/Pacific Group on Money Laundering) to further improve its AML/CFT (anti-money laundering & counter-terrorist financing) system".
What is the FATF 'grey list'?
When the FATF places a jurisdiction under increased monitoring, it means the country has committed to resolving swiftly the identified strategic deficiencies within agreed timeframes and is subject to increased monitoring. This list is often externally referred to as the “grey list”.
Being on the grey list can make it difficult for a country to secure any funding that it may require for a variety of legitimate purposes. Such a nation may find it difficult to get aid from the International Monetary Fund (IMF), World Bank, Asian Development Bank (ADB) and the European Union.
For Pakistan, such sanctions resulted in intensifying infrastructural issues as it required several rounds of extra checks and security before approving any aid to Islamabad.
How Pakistan got out of the 'Grey List'
Pakistan made it to the infamous list in 2018 following its inability to check money laundering leading to the financing of terror activities and corruption.
To get out of the list, the nation currently under Prime Minister Shebaz Sharif needed to secure the support of 12 out of 39 votes. In that case, it would move to the white list. To avoid the blacklist, the nation needs the support of at least three nations.
So far, China, Malaysia and Turkey have been their permanent supporters.
