KARACHI: As Pakistan got thrown another lifeline until June from the Financial Action Task Force (FATF) on Friday, a member of the government's economic advisory said it was mainly up to the parliament to act swiftly and make laws that met remaining FATF directions.
Islamabad was placed on the Paris-based terror financing watchdog’s greylist back in 2018 for its lack of adequate controls over terrorism financing. Since then, struggling with a balance of payments crisis, Pakistan was forced to turn to the International Monetary Fund for help and promised a series of measures to crack down on terrorism financing. This is the second four-month extension given to Pakistan to implement its agreed upon action plan.
“The majority of the remaining action items are related to legislations and it depends on the parliament how swiftly it acts to make laws,” Dr. Ashfaque Hassan Khan, a member of the government’s Economic Advisory Council, told Arab News on Saturday.
Pakistan was given 27 points to act on by the FATF, but on Friday, in a statement issued at the end of a week-long plenary meeting in Paris, the organization noted the country had largely addressed only 14 of those points, with varying levels of progress made on the rest of the plan.
“FATF again expresses concerns given Pakistan’s failure to complete its action plan in line with agreed timelines and in light of the TF (terrorism financing) risks emanating from the jurisdiction,” the intergovernmental body said.
The FATF also warned that failure to comply could lead to further penalties, including the country further downgraded to a blacklist. With hardly four months to go before the next FATF review, relief will be temporary with the new deadline looming over the horizon.
“They [FATF] want tangible and result oriented actions. There is seriousness on the part of the government to meet the shortcomings but they don’t have able men to handle required tasks. Neither the parliament nor government institutions can deliver due to a lack of specialised personnel to tackle all the issues,” Dr Ikram Ul Haq, a prominent Lahore-based economics expert, told Arab News.
“From legislation to enforcement, we need to work on a war-footing to meet all the requirements pointed out to us repeatedly,” he said.
A ministry of finance statement said on Friday that a strategy had been formulated and was being implemented to complete the remaining items on the FATF plan as soon as possible.
Islamabad has already amended its laws dealing with AML/TF, with harsh punishments and enhanced financial penalties. The country has also amended the Foreign Exchange Regulation Act and the Anti-Money Laundering Act-- which are now in process of being promulgated as law.
Some experts however, are downplaying the possible outcomes of another unfavourable review in June.
“There are no tangible impacts except that the country remains part of discourse worldwide,” said Dr. Waqar Masood, one of Pakistan’s former, longest serving federal secretaries of finance.
“Pakistan has made a lot of progress-- even more than its capacity,” he said, and added that strengthening the legal jurisdiction of anti- money laundering and terror financing would take time.
Ahead of the FATF Paris moot, Pakistan sentenced Lashkar-e-Taiba and Jamaat-ud-Dawa leader Hafiz Saeed to five and a half years in prison on terrorism financing charges. The move was seen as a demonstration of compliance with FATF recommendations-- but did not do enough to change the country’s status with the organization.
Compliance with remaining FATF guidelines requires ‘swift’ legislation — government advisor
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Compliance with remaining FATF guidelines requires ‘swift’ legislation — government advisor
- This is Pakistan’s second four month extension since being greylisted in 2018
- Ministry of Finance said on Friday that a strategy has been formulated and was being implemented
Pakistan orders four-day workweek, shuts schools to save fuel amid Middle East oil crisis
- The development comes as ongoing US-Israeli strikes on Iran disrupt oil supplies in Strait of Hormuz, push prices past $119 a barrel
- Islamabad bans government purchases, cuts fuel allocation for vehicles as well as workforce in public and private offices by 50 percent
ISLAMABAD: Prime Minister Shehbaz Sharif on Monday announced austerity measures, including a four-day work week, cuts in government expenditures and closure of schools, to offset the impact of rising global oil prices due to an ongoing conflict in the Middle East.
Global fuel supply lines have been disrupted in the Strait of Hormuz, which supplies nearly a fourth of world oil consumption, after Tehran blocked it following United States-Israeli strikes on Iran and counterattacks against US interests in the Gulf region.
Oil prices surged more than 25 percent globally on Monday to $119.50 a barrel, the highest levels since mid-2022, as some major producers cut supplies and fears of prolonged shipping disruptions gripped the market due to the expanding US-Israeli war with Iran.
In his televised address on Sunday night, Sharif said global oil prices were expected to rise again in the coming days but vowed not to let the people bear their brunt, announcing austerity measures to lessen the impact of fuel price hikes.
“Fifty percent staff in public and private entities will work from home,” he announced, adding this would not be applicable to essential services. “Offices will remain open for four days a week. One-day additional off is being given to conserve oil, but it would not be applicable to banks.”
Sharif didn’t specify working days of the week and the government was likely to issue a notification in this regard.
He said a decrease of 50 percent was being made in fuel allocation for government vehicles immediately for the next two months, but they would not include ambulances and public buses.
“Cabinet members, advisers and special assistants will not draw salaries for the next two months, 25 percent salaries of parliamentarians are being deducted, two-day salaries of Grade 20 and above officers, or those who are paid Rs300,000 ($1,067) a month, are being deducted for public relief,” he said.
Similarly, there will be 20 percent reduction in public department expenses and a complete ban on the purchase of cars, furniture, air conditioners and other goods, according to the prime minister.
Foreign trips of ministers and other government officials will also be banned along with government dinners and iftar buffets, while teleconferences and online meetings will be given priority.
“All schools will be off for two weeks, starting from the end of this week, and all higher education institutions should immediately begin online classes,” he said.
Sharif’s comments were aired hours after Pakistani authorities said the country had “comfortable levels” of petroleum stocks and the supply chains were functioning smoothly, despite intensifying Middle East conflict.
Petroleum Minister Ali Pervaiz Malik said three oil shipments were due to reach Pakistan this week, state media reported.
Meanwhile, Pakistan Navy (PN) launched ‘Operation Muhafiz-ul-Bahr’ to safeguard national energy shipments, the Pakistani military said on Monday, amid disruptions to critical sea lanes due to the conflict.
The navy is conducting escort operations in close coordination with the Pakistan National Shipping Corporation (PNSC), according to the Inter-Services Public Relations (ISPR), the military’s media wing. It is fully cognizant of the prevailing maritime situation and is actively monitoring and controlling the movement of merchant vessels to ensure their safe and secure transit.
“With approximately 90 percent of Pakistan’s trade conducted via sea, the operation aims to ensure that vital sea routes remain safe, secure, and uninterrupted,” the ISPR said on Monday. “Currently, PN ships are escorting 2 x Merchant Vessels, one of which is scheduled to arrive Karachi today.”
