In Today’s News:
- Pakistan to be in Grey list of FATF.
1. Pakistan to be in Grey list of FATF
Pakistan will likely remain in the Grey List of FATF. The main reason for Pakistan to remain on Greylist is due to the fact that Pakistan is yet to show progress in six key areas among the FATF’s 27 point action list.
Prelims GS – International Relations
- Financial Action Task Force
- FATF is the watchdog of global money laundering and terrorist financing.
- FATF is an inter-governmental body and was established by the G-7 summit held in Paris in 1989.
- There are 39 members in FATF. India is a member of FATF.
- Besides these, there are associate members and observer organizations.
- It has some important associate members like the Eurasian Group on Combating Money Laundering and Financing of Terrorism (EAG ), Asia-Pacific Group on Money Laundering (APG), etc.
FATF has 2 lists. They are:
- Countries knowns as Non-Cooperative Countries or Territories (NCCTs) are put on the blacklist.
- These countries support terror funding and money laundering activities.
- The FATF revises the blacklist regularly, adding or deleting entries.
- Eg: North Korea, Iran
- Countries that are considered safe haven for supporting terror funding and money laundering are put in the FATF grey list.
- This inclusion serves as a warning to the country that it may enter the blacklist.
- Eg: Pakistan
Mains GS2 – International Relations
Consequences of Greylist for the countries:
- Economic sanctions will be imposed on the Greylist countries from the IMF, World Bank, and ADB.
- Those countries cannot get loans easily from IMF, World Bank, ADB, and other organizations.
- In these countries, there will be a reduction in international trade
- Also, there will be an international boycott on these countries.
Click here to view the official website of FATF
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