Regulatory regionalism and anti-money-laundering governance in Asia

Abstract

With the intensification of the Financial Action Task Force's (FATF's) worldwide campaign to promote anti-money-laundering regulation since the late 1990s, all Asian states except North Korea have signed up to its rules and have established a regional institution—the Asia/Pacific Group on Money Laundering—to promote and oversee the implementation of FATF's 40 Recommendations in the region. This article analyses the FATF regime, making two key claims. First, anti-money-laundering governance in Asia reflects a broader shift to regulatory regionalism, particularly in economic matters, in that its implementation and functioning depend upon the rescaling of ostensibly domestic agencies to function within a regional governance regime. Second, although this form of regulatory regionalism is established in order to bypass the perceived constraints of national sovereignty and political will, it nevertheless inevitably becomes entangled within the socio-political conflicts that shape the exercise of state power more broadly. Consequently, understanding the outcomes of regulatory regionalism involves identifying how these conflicts shape how far and in what manner global regulations are adopted and implemented within specific territories. This argument is demonstrated by a case study of Myanmar.

Keywords:

• economic governance
• money laundering
• Myanmar
• regulatory regionalism
• sanctions

Notes

1. We thank Kelly Gerard, Kyaw Thu Mya Han and Zaw Nay Aung Than for excellent research assistance, the two anonymous reviewers and the participants at the workshop on Regionalisation, Regionalism and the Rescaling of Economic Governance in Asia, especially Kanishka Jayasuriya, for their comments on earlier drafts of this article.

Additional information

Funding

This work was supported by the Australian Research Council Discovery Project ‘Securitisation and the Governance of Non-Traditional Security in Southeast Asia and the Southwest Pacific’ [grant number DP110100425]; the Economic and Social Research Council project ‘How Do Economic Sanctions (Not) Work?’ [grant number RES-061-25-0500]; and the Westfield Trust and Association of South-East Asian Studies in the UK.