SA having greylisting extended on the decline, suggest some analysts
South Africa has addressed shortfalls in the regularly environment following some warnings from the FATF, which greylisted the country in 2023.
Money laundering, Image from Pixabay
JOHANNESBURG - Some analysts believe the risk of South Africa being greylisted for an extended period has subsided.
This comes as the country addressed shortfalls in the regulatory environment following some warnings by the Financial Action Task Team (FATF).
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In 2023, South Africa was the second G20 nation after Turkey to be greylisted amid concerns of poor controls to prevent money laundering and terrorist financing.
The stigma of being greylisted comes with some economic consequences, including tougher times accessing international finance at competitive rates and lower investor appetite for South African markets.
In a bid to minimise the impact on South African businesses and government entities, several key reforms spearheaded the country’s response.
The mandate of the Financial Intelligence Centre Act was already widened to include more effective monitoring and detection capabilities.
A banking and finance expert at Webber Wentzel, Rashaad Carrim, said the FATF saw some improvement in South Africa's profile.
“In the last report of the FAFT, they have indicated that South Africa has made positive progress in tackling technical compliance deficiencies in its anti-money laundering systems.”
While South Africa’s eyeing a 2025 exit from the grey list, the length of time a country remains under scrutiny depends on how long it takes to resolve the shortcomings.