Archbishop Sebastian Shaw (center) along with others celebrate Pakistan's removal from a global money laundering watchlist at an interfaith press conference at the Bishop’s House in Lahore on Oct 24. (Photo courtesy of Catholic TV Pakistan)
Church leaders expressed happiness as Pakistan was taken off a global money laundering watchlist, a move they hope will ease the financial crunch in the development and relief sector of the beleaguered nation.
In an interfaith press conference held on Oct. 24, Archbishop Sebastian Shaw of Lahore congratulated the whole nation and hoped the development will help steer the country out of the multiple crises it was facing.
“It’s a fruit of our coordination with leaders of different faiths in addressing the hate and extremism at ground level. It’s a combined effort,” Archbishop Shaw said.
The Financial Action Task Force (FATF), an international money-laundering watchdog, had put Pakistan on its so-called gray list in June 2018, after Islamabad failed to implement policies aimed at stamping out money laundering and the financing of international terror groups.
This was followed by the government in 2019 revoking licenses of non-governmental agencies, including Church organizations, preventing them from receiving foreign funds.
The fund crunch badly impacted efforts as more than 1,700 people were killed and 33 million displaced while a third of the country was submerged under water in the worst floods to hit Pakistan due to unprecedented monsoonal rains since mid-June.
"De-listing will help restore the confidence of our donors"
Caritas Pakistan officials said restrictions in receiving overseas funds have limited their work for flood-hit communities in the dioceses.
“The FATF de-listing will help restore the confidence of our donors as we struggle to recover from the impact of the floods,” said Amjad Gulzar, executive director of Caritas Pakistan.
Naeem Yousaf Gill, executive director of the National Commission for Justice and Peace, hoped the development will help Church organizations to reach out to the most deserving while also opening doors for much-needed international funds for the country’s economy.
Pakistan's foreign ministry said in a statement the decision was "much-awaited good news."
"Congratulations to the people of Pakistan," Foreign Minister Bilawal Bhutto Zardari tweeted.
While the move is a boost for the country’s image, it is not expected to have an immediate effect on the economy.
"Pakistan had demonstrated that it was pursuing terrorist financing investigations"
"The decision will help remove the uncertainty that currently grips the overall investment climate in the country," said Pakistani economist Kaiser Bengali.
While it removes one of the major barriers to foreign investment, Bengali cautioned that high inflation and interest rates would prevent a sudden inflow of cash.
Pakistan, which has long struggled with low-level militancy within its borders, has faced scrutiny over its ability to combat illicit financing, including militant organizations.
US regulators in 2017 and 2022 slapped major fines on separate Pakistani banks for failing to heed concerns over possible terrorist financing and money laundering.
But in June, former FATF president Marcus Pleyer said Pakistan had demonstrated that it was pursuing terrorist financing investigations and prosecutions against senior leaders of UN-designated terror groups and money laundering investigations.
FATF’s decision last week comes after Pakistan in recent years filed terror financing charges against several senior Lashkar-e-Taiba leaders, including the group’s founder Hafiz Saeed and his brother-in-law Abdul Rahman Makki, who the US and India had accused of being involved in the 2008 Mumbai attacks.
Talat Masood, a former general and now political analyst, said that doubts about security have affected confidence in Pakistan.
"This decision will improve our image and establish the fact that Pakistan is not supporting any terrorist organizations and is a safe destination for foreign investments," Masood said.