The real test on China’s commitment to tackling terrorism will come when it takes over the presidency of the 38-member Financial Action Task Force (FATF) on July 1.
Chinese banker and current vice president Xiangmin Liu is expected to take over from Marshal Billingslea of the US as the president of the multilateral financial watchdog for a year.
The appointment is significant as FATF will decide at its plenary meeting in October whether Pakistan will continue to remain in the “grey list” or be downgraded to the “black list”, which entails harsher financial sanctions.
This decision will be taken under Chinese watch after the FATF assesses whether Pakistan has delivered on a 27-point action plan against terror financing and money laundering by September.
Pakistan was placed in the grey list in June last year on the basis on consensus among FATF’s members for failing to do enough to counter terror financing and money laundering. Initially, when Pakistan was to be placed in the grey list, the consensus was broken by China, Turkey and the Gulf Cooperation Council. Under FATF’s rules, three members is the minimum requirement for breaking the consensus. Subsequently, Pakistan was placed in the grey list after China and GCC withdrew their objections.
While action taken by Pakistan against terror financing and UN-sanctioned groups and individuals will be discussed at the FATF’s plenary meeting in Orlando during June 20-21 under the US presidency, the critical call will be taken in October when Pakistan’s “all-weather ally” will be heading the powerful watchdog. “If Pakistan doesn’t improve its position, then its move to seek a multi-billion dollar bailout from the IMF will be in jeopardy,” a senior official said.