FATF status

South Africa is on the FATF List of Countries that have been identified as having strategic AML deficiencies

Latest FATF Statement - 21 February 2025

Since February 2023, when South Africa made a high-level political commitment to work with the FATF and ESAAMLG to strengthen the effectiveness of its AML/CFT regime, South Africa has taken steps towards improving its AML/CFT regime including by demonstrating that all supervisors apply effective, proportionate, and effective sanctions, ensuring competent authorities have timely access to accurate and up to date BO information on legal persons and arrangements and applying sanctions for breaches of violation by legal persons to beneficial ownership obligations. South Africa should continue to work on implementing its action plan to address its remaining strategic deficiency on demonstrating a sustained increase in investigations and prosecutions of serious and complex money laundering and the full range of TF activities in line with its risk profile. 

Compliance with FATF Recommendations

The last follow-up Mutual Evaluation Evaluation relating to the implementation of anti-money laundering and counter-terrorist financing standards in South Africa was undertaken in 2024. According to that Evaluation, South Africa was deemed Compliant for 5 and Largely Compliant for 32 of the FATF 40 Recommendations. It remains Highly Effective for 0 and Substantially Effective for 0 of the Effectiveness & Technical Compliance ratings.

South Africa has a strong anti-corruption framework, yet enforcement is weak and public sector accountability is low, leading to widespread corruption, particularly in public procurement. The government has initiated several judicial inquiries, including the Zondo Commission, to investigate systemic corruption linked to former President Jacob Zuma's administration. Despite the existence of laws like the Prevention and Combating of Corrupt Activities Act, which criminalizes various forms of corruption, the lack of whistleblower protections and inconsistent implementation hinder effective action against corruption.

South Africa has the most advanced economy in sub-Saharan Africa, characterized by stable institutions and a mature financial sector. However, it faces significant challenges, including a prolonged period of stagnation, corruption, and ongoing energy crises, which have hindered economic growth and investment. Despite these issues, South Africa remains an attractive destination for foreign investment due to its well-regulated capital markets and strategic position as a trade hub in the region.

South Africa's investment climate is supported by stable institutions, a mature financial sector, and a robust legal framework, making it an attractive hub for regional investment. However, challenges such as corruption, energy crises, and policy uncertainty hinder its potential, with the country facing ongoing issues like load shedding and a sub-investment grade credit rating. Despite these obstacles, South Africa remains open to foreign investment, actively promoting sectors where it has competitive advantages.