The Hindu : G-20 resolves to choke terrorist funding

Online edition of India's National Newspaper
Sunday, Nov 24, 2002

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G-20 resolves to choke terrorist funding

By Our Special Correspondent

The Finance Minister, Jaswant Singh, along with Francos Loos, Minister of Trade and Commerce for France, Paul Soateng, Chief Secretary of the Treasury, U.K., and Paul H. O'Neill, Secretary of Treasury, U.S., during a G-20 meeting in New Delhi on Saturday. — Photo: Anu Pushkarna

NEW DELHI NOV. 23. The Group of 20 (G-20) countries_comprising the developed and the important emerging market economies_ have reiterated their commitment to combat the financing of terrorism and have noted the trend that terrorist organisations are not necessarily depending on money transfers to finance their actions. Instead, there is an increasing tendency to finance terrorism through movement of goods, mainly gold and diamond.

Addressing the media at the conclusion of the fourth Ministerial Conference of G-20 Finance Ministers and Central Bankers here today, the Union Finance Minister, Jaswant Singh, also said that there could not be an universal mechanism for combating financing of terrorism and that each nation would have to fight it the best way it could. The meeting reviewed the progress made in implementing the action plan drawn up at earlier meetings in this regard but took note of the differing perceptions among nations on some issues.

For instance, hawala was an illegal operation in India, but all hawala transactions the world over were not necessarily for funding terrorism.

The Reserve Bank Governor, Bimal Jalan, is understood to have accepted the fact that some part of hawala did represent a cheaper form of money transfer. Hence the emphasis now would be on making such transfers cheaper and easier through banking and non-banking channels which were universally recognised. Money transfer through such institutions would have records pertaining to the recipient and the sender of money.

On globalisation, where perceptions differed, it was noted that the benefits could be maximised and associated risks mitigated through the pursuit of appropriate domestic policies and a healthy external environment. The international financial institutions would have to play a role in this.

At the same time, the conference acknowledged that the process of globalisation had not yet delivered its potential in reducing poverty in some of the world's poorest countries. It was, therefore, felt that reduction of the remaining trade and related barriers and phasing out of trade-distorting subsidies would contribute to spreading further the benefits of globalisation.

Asked whether the developed countries would abide by this and by when, Mr. Singh said "we have a statement of intent and a commitment towards elimination of trade barriers and this cannot be without a time-frame.''

The conference also appreciated the recent higher commitments by some countries to enhance Official Development Assistance (ODA) and to implement and fully finance the enhanced Highly Indebted Poor Countries (HIPC) initiative.

At the end of the conference, it was decided that Mexico would handle the chairmanship of the G-20 in 2003.

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