In the grey, again

Political party leaders are yet to internalise the importance of a clean and efficient fiscal sector.

After multiple warnings, the Financial Action Task Force (FATF) has again put Nepal in its grey list, citing the country’s failure to tackle money laundering. (Previously, Nepal was in the infamous list between 2008 and 2014.) Its re-listing by FATF, an intergovernmental panel tasked with combating money laundering and terrorist financing, was no surprise though. With not a little help of the political leadership, the problems of fiscal mismanagement, corruption and money laundering have become entrenched. This wouldn’t be so if there was a clear political commitment to boost public spending, tackle corruption and control financial crimes. What we see instead is that top politicians themselves protect the corrupt and criminals. Whenever there is a big corruption scandal—of which there are plenty each year—lower level functionaries get arrested and prosecuted but most of the big fish are left untouched. It is the nexus of these political big fish and business mafia that leads to financial crimes of all kinds. This in turn puts into perspective some of the FATF’s recommendations for Nepal to exit from the grey list.