Pakistan has been removed from an international grey list that warrants increased surveillance for terrorism financing, the head of the international money laundering watchdog which makes the list said on Friday.
The decision, which provides a boost to the reputation of the crisis-ridden South Asian nation, was taken at the end of a two-day meeting in Paris, Financial Action Task Force (FATF) president T Raja Kumar told a news conference.
“After a lot of work by the Pakistani authorities, they have worked through two separate action plans and completed a combined 34 action items to address deficiencies in their anti-money laundering and counter-terrorist financing systems,” FATF president T Raja Kumar told a news conference in Paris.
In a meeting in June, the FATF had said it was keeping Pakistan on the so-called “grey list”, but said it might be removed after an on-site visit to verify progress.
Kumar said a FATF team had visited Pakistan and was satisfied with the implementation of the programme.
“Pakistan exiting the FATF grey list is a vindication of our determined and sustained efforts over the years,” Prime Minister Shehbaz Sharif said on Twitter.
Pakistan was listed in 2018 because of “strategic counter-terrorist financing-related deficiencies”.
Even though the country had been removed from list, “there is work to be done,” Raja said, adding that the FATF encouraged Pakistan to strengthen its monitoring mechanisms.
With its removal from the list, Pakistan would essentially receive a reputational boost and get a clean bill of health from the international community on terrorist financing.
It would also improve sentiment, important from a foreign direct investment perspective.
Recent widespread floods in Pakistan have further weakened the country’s economy, already in turmoil with a rising current account deficit, inflation above 20% and a sharp depreciation of the rupee currency.