PM for stolen assets’ return from havens; int’l anti-money laundering instruments

Islamabad: Prime Minister Imran Khan Thursday emphasized the international community to seek commitment from the “haven” countries to return all foreign stolen or illegitimate assets and develop international anti-money laundering legal instruments.

Addressing as a keynote speaker at the virtually held launching ceremony of the Final Report of the High-Level Panel on International Financial Accountability, Transparency and Integrity for Achieving the 2030 Development Agenda (FACTI Panel), the prime minister called for considering the OECD’s proposal to freeze and return the unexplained assets of foreign “Politically Exposed Persons.”

The event was also addressed by 75th President of the General Assembly Volkan Bozkir, 76th President of the Economic and Social Council Munir Akram.

The report presents 14 recommendations to reform, redesign and revitalize the global architecture, so it can effectively foster financial integrity for sustainable development. Besides, it stresses for strengthening coordination and global governance related to financial integrity as an essential component of the common agenda for the common future of present and coming generations.

Urging for some quick concrete actions, the prime minister first emphasized on “a commitment by “haven” countries to immediately and unconditionally return all foreign assets that are shown to be stolen or whose “legitimacy” cannot be explained. The OECD’s proposal to freeze and return the unexplained assets of foreign “Politically Exposed Persons” is worthy of consideration.”

The FACTI Panel is the High Level Panel on International Financial Accountability, Transparency and Integrity for Achieving the 2030 Agenda.

“It aims to improve the world’s chances of achieving sustainable development by making recommendations that both strengthen current efforts to combat illicit financial flows, and close remaining gaps in the international system,”

The prime minister urged the international community to initiate negotiations on the new international tax cooperation and anti- money laundering legal instruments, like the Convention on Corruption.

The adoption of common principles identified by the FACTI Panel to apply to all financial transactions, and establishment of a UN coordination, adjudication and mediation mechanism on illicit financial flows also comprised the quick concrete actions proposed by the prime minister who is now globally recognized for his efforts against corruption and money laundering for his decades long struggle to purge the country of the very evils.

He told the audience that his government had inherited a country with empty coffers, denuded by huge and accumulated trade and fiscal deficits, but “more than that, by illicit financial outflows from our country.”

He viewed that the FACTI’s Interim Report confirmed that due to political and official corruption, as well as crime and tax evasion, trillions of dollars flow out of developing countries each year.

“Seven trillion dollars in stolen assets are parked in the financial “haven” countries. The flight of these vast resources from the developing countries is a principal cause of their under-development, poverty, inequality and political instability,” he remarked.

He recalled that during the consideration of the Interim Report in September last year, he had suggested several global policy actions including immediate return of stolen assets; penalties on the financial institutions, lawyers and accountants, and other “enablers” of corruption, crime and tax evasion.

The disclosure of the “beneficial ownership” of companies; a global minimum corporate tax; fair digital taxation; review and revision of unequal investment treaties; and a coherent mechanism for monitoring illicit financial flows set up under the United Nations were also part of his proposed policy actions.

Expressing pleasure over the Final Report of the Panel marking his proposed policy actions, the prime minister said that was a systemic problem, embedded within the international financial architecture.

“It requires a systemic solution. It cannot be resolved by piecemeal or cosmetic actions. The magnitude of the illicit financial flows is staggering. If recovered and returned, they can have a transformational impact on the development prospects of the developing countries.”

Quoting the report, the prime minister said this could enable the developing countries to eradicate poverty, reduce inequalities, build back better after the COVID crisis, address climate change and strengthen human rights.”

He also endorsed the three-point plan proposed by the panel including applying international “values” of honesty and integrity to all financial transactions; strengthen policy frameworks; and reform and reinforce the relevant institutions dealing with these illicit financial flows.

He viewed that the said responses could form part of a Global Pact for Financial Integrity.

Imran Khan called for regulating national and cross-border financial transactions under a “values-based” system, encompassing accountability, transparency, legitimacy, fairness, inclusion and equity.

He called for reflecting the said “values” in all national and international financial instruments, institutions and transactions – and particularly in those bodies which address illicit financial flows.

Asking for improvement of global financial governance, Imran Khan stressed for implementing policies on illicit flows in a coordinated and coherent way by national and international institutions and bodies.

“International bodies dealing with tax matters, corruption and illicit financing should be inclusive and representative. They should not be used as instruments of pressure and coercion against developing countries,” he underscored.

He said a global forum, under the UN, should coordinate all bodies dealing with the technical, legal and political aspects of illicit financial flows. It should incorporate a mechanism to adjudicate and mediate disputes on issues relating to illicit financial flows, he added.

“It’s now time to act on the recommendations of the FACTI Panel. Pakistan will be happy to join in proposing the adoption of the FACTI Panel Report by the United Nations Economic and Social Council and the General Assembly.”

He also assured the world community that Pakistan would work actively with all like-minded countries to realize the said vital objectives.