ISAS Insights

Established in 1989, the Financial Action Task Force (FATF) has developed detailed criteria to assess the performance of all countries and jurisdictions in managing their financial dealings with the world outside their borders. Based on its criteria, the FATF made public ‘grey’ or ‘black’ lists, identifying those that did not meet its criteria. Pakistan, for a variety of reasons, was one of the targeted countries. In June 2018, it avoided being put on the ‘black’ list by agreeing to a 26-point action plan formulated by the government in place for an interim period to manage the general elections scheduled for 25 July 2018. This paper will elaborate how political considerations have seeped into the FATF’s decision-making process and its mode of operation. It then goes on to discuss the impact this decision will have on Pakistan’s economic future.