Rajesh Singh
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I am not economist but if I starting figure out Possible impact on Pakistan as added in grey List..
Possibilities Are :-
1. The Financial Sector - Standard Charted, Citi Bank and Deutsche banks's might decide to pull out.
2. A decline in foreign transactions and foreign currency flows could lead to further Welding of Pakistan's already large current account deficit.
3. It will make harder fro foreign investors and companies to business in Pakistan.
4. Getting fund from international market would be more tougher for Pakistan.
5. Pakistan would be made to go thru the extra scrutiny which can hurt the economy very badly.
6. Pakistan's image takes a hit: The decision to put Pakistan back on the list will translate into a "major setback for Islamabad's efforts to improve its image", according to Dawn
7. Higher cost of international transactions: FATF, which maintains grey and black lists for identifying countries that have weak measures to counter and combat money laundering and terror financing, does not have the authority or power to impose sanctions on a country found non-compliant with the required standards. But a country's listing can have an impact on its international transactions, as it would come under greater scrutiny.
8) Higher cost of doing business: Analysts fear that punitive action could be taken against Pakistan if it is found to be complicit in terror financing. Such an action could jack up the cost of doing international and domestic business.
9) It can hurt Pakistan's economy 'very badly': Pakistani officials and Western diplomats have told news agencies that being included in the FATF watchlist could deal a blow to Pakistan's economy as it would make it harder for foreign investors and companies to do business in the South Asian nation. "If you're put on a terror watchlist, you're made to go through all the (extra) scrutiny," Pakistan's former counter-terrorism chief, Khawaja Khalid Farooq, told Reuters. "It can hurt the economy very badly," he added.
10) Borrowing gets costlier: Officials fear that after being put on the FATF monitoring list, it would be harder and more expensive for Pakistan to borrow money from international debt markets, news agencies have reported.
A Pakistani finance ministry source told Reuters that the government also feared a downgrade by global credit ratings agencies, making it harder or more expensive for Pakistan to raise debt from the international markets. "It reduces our credibility in the world, which is unfair," Pakistan's State Minister for Finance, Rana Afzal, was quoted as saying.
11) Entry into grey list snaps global banking links: Pakistan being placed back on the global terrorist financing watchlist could endanger its handful of remaining banking links to the outside world, causing real financial pain to the economy, another agency report said.
12) 'Definitely not good' for Pakistan: There are concerns, according to agency reports, that Pakistan's nearly $300-billion-strong economy, which has been expanding at its fastest rate in a decade, at above five per cent, could lose steam after the country ends up being placed back on the FATF watchlist. Pakistan was removed from it in 2015 after three years.
"We don't think the consequences are going to be drastic but it's definitely not good," one senior finance ministry official was quoted as saying earlier.
13) Foreign banks will hesitate in dealing with Pakistani counterparts: Speaking to Reuters, Mike Casey, a partner at London law firm Kirkland & Ellis, said that being put back on the grey list would heighten Pakistan's risk profile. Casey added that as a consequence, some financial institutions would be wary of transacting with Pakistani banks and counterparties. "Others might elect to avoid Pakistan altogether, viewing the legal risks associated with doing business there to outweigh any economic benefits," he said.
14) Pakistan's current account deficit could widen: In perhaps one of the biggest impacts, a decline in foreign transactions and foreign currency inflows could lead to further widening of Pakistan's already large current account deficit (CAD). For the country, its CAD has proved to be the Achilles heel; its economy had to be bailed out by the International Monetary Fund (IMF) in 2013 after a balance-of-payments crisis.
Possibilities Are :-
1. The Financial Sector - Standard Charted, Citi Bank and Deutsche banks's might decide to pull out.
2. A decline in foreign transactions and foreign currency flows could lead to further Welding of Pakistan's already large current account deficit.
3. It will make harder fro foreign investors and companies to business in Pakistan.
4. Getting fund from international market would be more tougher for Pakistan.
5. Pakistan would be made to go thru the extra scrutiny which can hurt the economy very badly.
6. Pakistan's image takes a hit: The decision to put Pakistan back on the list will translate into a "major setback for Islamabad's efforts to improve its image", according to Dawn
7. Higher cost of international transactions: FATF, which maintains grey and black lists for identifying countries that have weak measures to counter and combat money laundering and terror financing, does not have the authority or power to impose sanctions on a country found non-compliant with the required standards. But a country's listing can have an impact on its international transactions, as it would come under greater scrutiny.
8) Higher cost of doing business: Analysts fear that punitive action could be taken against Pakistan if it is found to be complicit in terror financing. Such an action could jack up the cost of doing international and domestic business.
9) It can hurt Pakistan's economy 'very badly': Pakistani officials and Western diplomats have told news agencies that being included in the FATF watchlist could deal a blow to Pakistan's economy as it would make it harder for foreign investors and companies to do business in the South Asian nation. "If you're put on a terror watchlist, you're made to go through all the (extra) scrutiny," Pakistan's former counter-terrorism chief, Khawaja Khalid Farooq, told Reuters. "It can hurt the economy very badly," he added.
10) Borrowing gets costlier: Officials fear that after being put on the FATF monitoring list, it would be harder and more expensive for Pakistan to borrow money from international debt markets, news agencies have reported.
A Pakistani finance ministry source told Reuters that the government also feared a downgrade by global credit ratings agencies, making it harder or more expensive for Pakistan to raise debt from the international markets. "It reduces our credibility in the world, which is unfair," Pakistan's State Minister for Finance, Rana Afzal, was quoted as saying.
11) Entry into grey list snaps global banking links: Pakistan being placed back on the global terrorist financing watchlist could endanger its handful of remaining banking links to the outside world, causing real financial pain to the economy, another agency report said.
12) 'Definitely not good' for Pakistan: There are concerns, according to agency reports, that Pakistan's nearly $300-billion-strong economy, which has been expanding at its fastest rate in a decade, at above five per cent, could lose steam after the country ends up being placed back on the FATF watchlist. Pakistan was removed from it in 2015 after three years.
"We don't think the consequences are going to be drastic but it's definitely not good," one senior finance ministry official was quoted as saying earlier.
13) Foreign banks will hesitate in dealing with Pakistani counterparts: Speaking to Reuters, Mike Casey, a partner at London law firm Kirkland & Ellis, said that being put back on the grey list would heighten Pakistan's risk profile. Casey added that as a consequence, some financial institutions would be wary of transacting with Pakistani banks and counterparties. "Others might elect to avoid Pakistan altogether, viewing the legal risks associated with doing business there to outweigh any economic benefits," he said.
14) Pakistan's current account deficit could widen: In perhaps one of the biggest impacts, a decline in foreign transactions and foreign currency inflows could lead to further widening of Pakistan's already large current account deficit (CAD). For the country, its CAD has proved to be the Achilles heel; its economy had to be bailed out by the International Monetary Fund (IMF) in 2013 after a balance-of-payments crisis.
