Friday, December 4, 2020

Batswana should be told implications of EU blacklisting – and more!

It is now official. Botswana has failed to beat the deadline to remedy the list that was issued by the European Commission, the executive arm of the European Union. As a result, the country has been put among a list of countries considered risky by the Europe. To start with, this is a big deal. Europe is one of the most important economic blocks in the world. Botswana relies heavily on revenue from exports sent to the EU. That has been so for the longest time. As a small African country, Botswana needs to be in the good books of all these economic blocks that include China, Asia, OECD, the United States of America and others.

It has not been fully explained why, to start with Botswana, for the first time found itself on the wrong side of European laws. Those reasons have to be spelt out by our authorities including FIA (Financial Intelligence Agency). Cabinet should lead this exercise in the spirit of transparency and also accountability. Essentially, we know that the blacklisting implies financial un-cleanliness. This is unprecedented for Botswana. We are a country that is used to receiving only accolades. We are not used to being punished, hence our utter shock and even helplessness in the face of blacklisting. Botswana Government has thus far not even hinted any element of unfairness or abuse of power on the part of the EU.

Instead government had said they were working on compliance, again implying admission of guilt, possibly as charged. On the list Botswana has joined countries like Syria, Iraq, Afghanistan, Zimbabwe, Nicaragua, Uganda and Yemen to name but a few. Botswana is clearly not in good company. Of course, it can be argued, quite convincingly that Europe’s choice of which countries to blacklist is suspect .There is little doubt that EU has now unfairly weaponized the anti-money laundering regime as a way of continuing to impose itself on mainly the non-white countries. It is also neither clear nor transparent why the EU uses criteria different from the OECD, for example which too has been on a similar crusade to crackdown on other nations.

While there is a hint by EU of possible risks to finance terrorism, there are no plausible answers why powerful countries like Saudi Arabia that are known to finance terrorism have never been on the list. Being on the EU blacklist has consequences. Banks are obliged to apply stricter due diligence to financial flows involving blacklisted countries. With blacklisting, companies in those countries also get discriminated against when it comes to receiving EU money and technical assistance. Botswana is among the countries aggressively pushing to get removed from the list. The country is using official diplomatic channels and also back channels. Botswana has a strong case to get itself removed.

Firstly, the country was not pre-warned as is normally the case. Instead the decision was a unilateral one taken by EU. Secondly, to take this decision in the middle of a pandemic is heartless and might point to ulterior motives.EU, if it meant well, could easily have run the clock to see the pandemic come to an end before introducing and imposing its decision.

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