NIGERIA, SOUTH AFRICA REMOVED FROM GLOBAL DIRTY-MONEY WATCHLIST – FATF PRAISES ANTI-LAUNDERING REFORMS
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By Aishat Momoh. O.
Nigeria and South Africa have been removed from the Financial Action Task Force’s (FATF) “gray list” of countries under increased monitoring for money laundering and terrorist financing, marking a major boost for investor confidence and international transactions in Africa’s two largest economies.
The FATF, a Paris-based global watchdog, announced on Friday that both countries — along with Mozambique and Burkina Faso, had demonstrated significant progress in strengthening their anti-money laundering frameworks and financial oversight systems.
South Africa and Nigeria were placed on the gray list in February 2023, while Mozambique was added in October 2022 and Burkina Faso in February 2021. At the FATF’s June plenary session, the organization commended all four nations for implementing key reforms to curb illicit financial flows.
Economists say South Africa’s removal from the list will bolster investor sentiment, potentially lowering bond yields and easing debt-servicing costs. “It reinforces market optimism and signals progress on government reforms a boost for institutional strength,” said Jee-A Van Der Linde, senior economist at Oxford Economics.
For Nigeria, the FATF decision is expected to ease the cost and flow of international remittances a crucial lifeline that brings in around $20 billion annually from Nigerians abroad.
Finance Minister Wale Edun hailed the development as a “vote of confidence” in Nigeria’s economic governance.
“This reinforces confidence in our economy and the integrity of our monetary and financial systems,” Edun said. “It will ease cross-border transactions, improve capital flows, including foreign direct investment, and strengthen the foundations for rapid and sustainable economic growth and job creation.”
The FATF decision could also clear the way for renewed foreign investments in Mozambique, particularly in its massive liquefied natural gas project, which had faced uncertainty during the country’s gray-listing period.
Under the leadership of Elisa de Anda Madrazo, FATF has refined its gray-listing process to increase scrutiny of wealthier member nations while reducing the compliance burden on lower-risk developing economies.
According to FATF’s updated assessment calendar, South Africa’s next on-site review is scheduled for April 2027, under the organization’s new methodology for the fifth round of evaluations.
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