The State Bank Governor Reza Baqir has stated that the Financial Action Task Force (FATF) and International Monetary Fund (IMF) have both appreciated Pakistan for its efforts in curbing money laundering. This is excellent news, even though we still have some work to do. Pakistan will take action sooner rather than later, because the next review will be held in February 2020. The government will also have to establish its progress a few weeks before that in January, with the Joint Review Group of the Asia Pacific Group looking to scrutinise compliance in this sphere before FATF does.

With less than two months to go, we must show tangible progress beyond curbing money laundering as well. Terror financing and charging and prosecuting those accused of terrorism will also have to follow clamping down on money laundering. According to the government, steps are already being taken in these areas as well, but will they be enough to finally extricate Pakistan out of the grey list ?

Opinion on Pakistan’s performance seems to be divided. Most experts have said that the country is on its way to get its name off the grey list . Pakistan has been on the grey list since June 2018, and has only improved its capacity to curb money laundering and terror financing; Pakistan must argue its case properly, and guard against India’s malicious diplomatic attacks.

The government has been making visible moves to comply with the FATF guidelines. The government has been reported to be looking to hire a commercial bank to review 4 million existing accounts in the banking system within the next six months. This tells us that the state is unable to carry out this task on its own, but it is not waiting to build capacity, rather it is outsourcing the essential work to complete it as soon as possible. In the long run relying on third parties will simply not be enough. Constructing a risk profile for each of these accounts can not be left up to the commercial sector indefinitely.

It is hoped that the next FATF review brings some good news. It is true that there is not one meter to measure all, and some of the conditions attached to Pakistan have been stricter than others. Still, Pakistan has already been on a national agenda to wipe out terror financing. The FATF is not introducing a new concept. Pakistan is cleaning up for itself, not for anyone else. And it is doing so successfully.