ISLAMABAD: Pakistan’s top investment body on Tuesday said it had finalized plans to resolve key issues related to the country’s economic sectors of agriculture, information technology, minerals and energy.
Pakistan in June set up the SIFC — a civil-military hybrid forum — to fast-track decision-making and promote investment from foreign nations, particularly from Gulf Cooperation Council (GCC) nations. The council has pinpointed five key sectors for attracting investment: agriculture, mining, information technology, defense production, and energy.
The South Asian country established the council as it grapples with a serious economic crisis that has seen its currency weaken against the US dollar over the past one year amid staggering inflation. Pakistan is also facing an acute balance of payments crisis amid increasing foreign debt.
The SIFC’s executive committee held its fifth meeting on Tuesday to review measures for improving the investment environment in the country, a statement from the body said.
“After healthy debate, the Committee formulated workable options, by drawing consensus among stakeholders, to resolve key impediments to investment environment in the country,” the SIFC said. “The plans were also finalized to resolve issues related to four key sectors (Agri, IT, Minerals and Energy) besides, adding new projects to the forum.”
Last week, Pakistan’s Caretaker Prime Minister Anwaar-ul-Haq Kakar, during his visit to New York to attend the UN General Assembly, met business and thought leaders and stakeholders to pitch the forum to them and made the case for improved business climate in Pakistan together with its potential for foreign direct investment in a range of sectors.
Earlier this month, Kakar confirmed Saudi Arabia and the United Arab Emirates (UAE) would invest $25 billion each in cash-strapped Pakistan within the next five years as part of projects under the SIFC.
Saudi Arabia has also explored investment opportunities in Pakistan’s mining sector and contributed $500 million to modernize Pakistan’s agricultural sector through the Land Information and Management System Center of Excellence (LIMS-CoE). This continued financial backing from Gulf allies is crucial for Pakistan’s economic stability.
 

ISLAMABAD: Pakistan’s top financial regulator said on Tuesday it had amended the country’s anti-money laundering and counter-terrorism financing regulations to effectively curb crimes and strengthen its financial system.

International watchdog Financial Action Task Force (FATF) removed Pakistan from its “grey list” after four years in October 2022. The list is composed of countries with a high risk of money laundering and terrorism financing but which have formally committed to working with the task force to make changes.

The decision was taken after the South Asian country took stringent measures to comply with the FATF’s demands by acting against those linked to money laundering and terror financing. Being on the Paris-based watchdog’s grey list can scare away investors and creditors, hurting exports, output and consumption. It also can make global banks wary of doing business with a country.

“The Securities and Exchange Commission of Pakistan (SECP) has introduced important amendments to the Anti-Money Laundering and Countering Financing of Terrorism (AML/CFT) Regulations, 2020,” the SECP said in a press release.

“The notified amendments aim to enhance the scope of regulations to effectively combat financial crimes, control money laundering, and combat the financing of terrorism (CFT) while ensuring the integrity of its financial system.”

The SECP said the amendments were an outcome of a self-assessment of its AML/CFT framework conducted by the commission this year. It added that the assessment was made against the criteria used in the FATF Assessment Methodology for assessing Technical Compliance of its AML/CFT regulatory framework.

According to a notification, the amendments empower a “regulated person” or a financial entity, to engage a third party to carry out a series of checks to ensure a customer’s identity, or Customer Due Diligence (CDD) and also verify the identity of beneficial owners.

“Provided that despite the third party reliance, the regulated person shall remain liable for any failure to apply the indicated CDD measures,” the SECP said.

The amendments also make it mandatory for the financial institution to ensure that their foreign branches and majority-owned subsidiaries in countries which do not sufficiently apply the FATF’s recommendations, apply Pakistan’s AML & CFT measures “to the extent that host country laws and regulations permit.”

“If the foreign country does not permit the proper implementation of AML/CFT measures consistent with that of Pakistan requirements, financial groups should apply appropriate additional measures to manage the risks, and inform the Commission when a foreign branch or subsidiary is unable to observe appropriate AML/CFT measures,” it added.

The revised regulations also state that an account will be classified as dormant after three years of inactivity, as opposed to the previous threshold of five years. The amendments also contain regulations for opening a bank account for mentally disabled persons, such as proper verification of the identity documents of the disabled person and their court-appointed managers.