Pakistan Country Summary

FATF Status

Pakistan is no longer on the FATF List of Countries that have been identified as having strategic AML deficiencies.

Compliance with FATF Recommendations

The last Follow-up Mutual Evaluation Report relating to the implementation of anti-money laundering and counter-terrorist financing standards in Pakistan was undertaken in 2022. According to that Evaluation, Pakistan was deemed Compliant for 9 and Largely Compliant for 29 of the FATF 40 Recommendations. It remains Highly Effective for 0 and Substantially Effective for 0 with regard to the 11 areas of Effectiveness of its AML/CFT Regime.

Pakistan faces significant challenges related to crime and corruption, characterized by widespread bribery and inefficiencies within the judicial system. While there are efforts to combat organized crime and improve accountability, political interference and a lack of resources hinder effective governance and law enforcement, leaving many citizens vulnerable to various forms of exploitation, including human trafficking and financial crimes.

Pakistan's economy is currently characterized by fragility, marked by weak macroeconomic indicators and a heavy reliance on imports, which has hindered foreign direct investment (FDI). The business environment is challenging, with high inflation, bureaucratic hurdles, political instability, and security concerns cited as significant barriers to investment. Despite these challenges, the Pakistani government is actively working to stabilize the economy and attract foreign investment, exemplified by the establishment of the Special Investment Facilitation Council (SIFC) and the implementation of a new Investment Policy aimed at improving the investment climate and promoting sectors such as ICT, agriculture, and renewable energy.