Pakistan was officially placed on the grey list of the Financial Action Task Force (FATF) on Wednesday after a plenary meeting in Paris. Despite Pakistan’s efforts to convince the FATF to decide otherwise, the watchdog argued that Islamabad had failed to take enough measures to curb terror financing from its soil.
Heading the Pakistani delegation, caretaker Finance Minister Dr Shamshad Akhtar pleaded Pakistan’s case earlier in the day and urged the FATF to remove Pakistan from its grey list. The Pakistani delegation also apprised the watchdog of the important steps Islamabad had taken to weed out money laundering and terror financing.
In wake of this decision, below is a re-plug of the commentary written by Imtiaz Gul, Executive Director CRSS, in February this year where he argues that Pakistan now needs pro-active, credible, smart solutions that do not unnecessarily burden our friends, solutions that project us as a forward-looking, honest and responsible member of the global community.
Lessons from FATF as Pakistan put on grey-list
By Imtiaz Gul
Pakistan escapes the inevitable – for another three months though. Beset by disagreements and opposition by some lead countries, the 37-nation Financial Action Task Force (FATF), a global watchdog on money laundering and terror financing, has put Pakistan on notice until June 18 to clear decks. This implies that Pakistan would have to comply with demands which not only come from Washington but are shared also by other leading western nations. Ostensibly, they want the country to tailor its financial mechanisms to meet global standards as a wall to terror financing. But it was bad news indeed for all those who had shouted the whole day on the “grim specter ” that they believed Pakistan faced i.e. re-inclusion in the grey list.
But public statements on the outcomes issued at the end of the FATF meeting on Feb 23rd made no mention of Pakistan. The countries on the FATF’s watch-list, announced after the meeting, included Ethiopia, Iraq, Serbia, Sri Lanka, Syria, Trinidad and Tobago, Tunisia, Vanuatu, North Korea and Yemen.
The entire episode and the circumstances around the FATF proceedings merits dissection from two angles
- a) geo-political , and
- b) poor, tardy domestic responses to critical issues
No doubt, geopolitics flowing from President Trump’s Afghanistan strategy he announced in August last year is meanwhile guiding such pressures. It became all the more evident from the steady stream of news via Indian news networks on Feb 22/23rd, suggesting Pakistan is being put back on the grey list of countries suspected of abetting terrorism. Even the global news agency Reuters news agency lapped up overjoyed Indian media and diplomatic sources to report that FATF had decided to “grey-list” Pakistan.
In that context, the Paris meeting emerged as another polarizing forum and reinforced deep-seated perceptions about the west; in Pakistan, it was seen as paradoxical that the anti-Pakistan motion was moved and supported by all those who are publicly aligned against China in the ongoing geo-political contest; USA, UK, Germany, France, Australia and India. Most of them tout themselves as friends but are currently singing the song fed by India, so ran the narrative.
Despite knowing the socio-political context and the systemic deficiencies – result of internal governance and foreign policy failures as well as of geo-politically driven expedience of the west (read partnership with Pakistan in the Afghanistan and anti-terror war projects) they all ganged up in what can be described as coercive diplomacy.
Now to the national scene. The Feb 21st tweet from Moscow by foreign minister Khawaja Asif laid bare the poor understanding and clumsy handling of sensitive issues by Pakistani leaders. This act underscored – yet again – that our leaders’ propensity to blow away chances through reckless handling, and embarrass and unnecessarily burden friends is boundless.
Pakistan is not a member of the FATF and thus was not privy to what was going on inside. Secondly, all its deliberations are confidential but the Indian sources kept feeding media on possibilities as “decided matter,” and thus violated the confidentiality clause of the conference. All decisions are confidential until and unless announced by the authorized forum office holders.
But, a thoughtless foreign minister, Khawaja Asif – in an apparent attempt to upstage Indian officials – nearly destroyed all the behind-the-scenes good work by diplomats and foreign friends – when he took to twitter to announce the three-month breather. That shocked and annoyed all our friends at the Forum, it seems.
That all efforts ended contrary to the hard work that the “anti-group” had put in should be viewed as yet another opportunity Pakistan’s friends have afforded it to set things right. Had it not been for their support, Pakistan would have yet again become victim of its own inaction, inefficiency and indecision. External factors only exploit those weaknesses.
The temporary breather indeed amounts to a wake up call for all those who matter for actual decisions and actions – the core of decision makers at the PM House and GHQ – ahead of necessary course correction through demonstrable actions. Any country – Israel or India – with US at its back will always get away with the worst of records. It’s about geo strategic and geo-economic interests.
Clearly, China, with its trillions of dollars worth of economic and commercial stakes across the globe, would not stick its neck out for too long. Nor would the Russian and Turkish support be permanent. CPEC has injected an unusually high sense of entitlement into minds of Pakistan’s civilian and military leaders, little realizing that China has massive stakes in maintaining and preserving its multi-trillion dollar economic interests world over, including hundreds of billions of dollars worth of investments in the United States itself.
Now, regardless which nations – Turkey, Saudi Arabia or China – managed to buy us another three months – all custodians of power in Pakistan MUST understand that geo-political considerations often trump bilateral relations. These also mostly determine the extent that one ally can stretch itself it to in issues that have global implications for all. With a few exceptions, permanence of such support is not guaranteed.
That is why – in the words of dear friend Mosharraf Zaidi – Pakistanis, “instead of celebrating the support of Turkey, China & Saudi Arabia (who almost always stand by Pakistan), should ask ourselves why we keep putting these great countries in this position. Pakistan should be a beacon, not a burden. It’s a time for shame, not celebration.
But even a three-month reprieve exposed limitations of such coercive diplomacy in a geo-commercially and closely knit world that does not stand on linear principles any more. Shades of grey dominate the global landscape with multiple competing interests.
Lesson for Pakistani leaders: Don’t drag your feet on things that are unavoidable and inevitable. Don’t wait until the crisis hits us. Do not duck under excuses. Nor is the tendency to dump failures on external geo-political factors the right response to existential threats. We need pro-active, credible, smart solutions that do not unnecessarily burden our friends, solutions that project us as a forward-looking, honest and responsible member of the global community. No country will stand by you forever.So don’t stretch your friends’ limits. Nor put their patience to unbearable test.
The author is Executive Director, CRSS