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Iran’s foreign minister, Mohammad Javad Zarif, warned Tuesday that not joining the Financial Action Task Force, the international coalition that combats money laundering and terrorist financing, would “harm the national interests of the country.”
Within Iran, hardliners and allies of the supreme leader have argued the remaining requirements — the Palermo convention and the Combating Financing of Terrorism bill — would curtail Iran’s ability to support regional allies such as Hezbollah and Hamas. However, reformers have said the measures are critical for the financial well-being of the country.
Esfandyar Batmanghelidj, founder of Bourse & Bazaar, which tracks developments in Iran’s economy, says regardless of setbacks in parliament, these bills are not dead in the water. “There is a sense the process wouldn’t have gotten this far if there wasn’t a consensus that this needed to happen,” he said.
Despite the June deadline, FATF has given some leeway to Iran in the past. Batmanghelidj points out that the watchdog as well as European allies both understand the internal pressures working against Rouhani and have attempted to keep the issue from being politicized.
Passing the FATF requirements is part of Rouhani’s vow to fight corruption, curb military control of the economy and stabilize the financial system. But, as Batmanghelidj points out, fulfilling FATF requirements is just one step and more will have to be done. “There will need to be structural changes in the financial system,” he said.
A final decision on FATF requirements has been postponed by the Expediency Council until after the Iranian New Year holiday, which began Wednesday.