Nepal avoids FATF blacklisting
Kathmandu, Feb 17 : Nepal has managed to avoid being blacklisted by the Financial Action Task Force (FATF), a global inter-governmental anti-money laundering body ,for two months.
Diplomatic efforts yielded positive results and Nepal’s status of ‘Improving Global Anti-Money Laundering and Combating Financing Terrorism Compliance: On-going process’ remained unchanged. FATF had warned that it could blacklist Nepal if it failed to endorse the bills on extradition, mutual legal assistance and organized crimes.
FATF meeting held in Paris has however blacklisted 15 countries. Nepal has to fulfill its commitment and pass the three pending bills — Mutual Legal Assistance Bill, Extradition Bill and Bill against Organized Crime — that are among the major commitments to FATF in fighting the flow of dirty money.
The government’s failure in fulfilling its international commitment in fighting flow of dirty money is going to cost the country dearly apart from the financial sector that is going to feel the heat the most, apart from the flow of foreign investment. Similarly, the donors will also include more stringent conditional ties for aid and grants once the country is blacklisted.
Apart from the financial sector that will be hit hard as they cannot have any international transactions, in case of failure in approving the bills, the country will lose its international markets as the cost of exports will go up making Nepal’s exports expensive.
Earlier, Nepal had committed FATF to approve these Bills coupled with other reforms by December 2011, but the country, passing through transition phase, has not been able to keep its promise.
