FATF Status

Armenia is not on the FATF List of Countries that have been identified as having strategic AML deficiencies

Compliance with FATF Recommendations

The last follow-up Mutual Evaluation Report relating to the implementation of anti-money laundering and counter-terrorist financing standards in Armenia was undertaken in 2019. According to that Evaluation, Armenia was deemed Compliant for 19 and Largely Compliant for 18 of the FATF 40 Recommendations. It was deemed Highly Effective for 0 and Substantially Effective for 6 with regard to the 11 areas of Effectiveness of its AML/CFT Regime.

The Armenian government has made strides in combating corruption since the 2021 parliamentary elections, implementing a new anti-corruption strategy and establishing various institutions such as the Corruption Prevention Commission and the Anti-Corruption Committee. Despite these efforts, civil society expresses dissatisfaction with the pace of reforms, and corruption remains a significant barrier to foreign investment, particularly in sectors like justice and law enforcement. While Armenia's Corruption Perception Index score improved in 2023, concerns about the effectiveness and independence of anti-corruption institutions persist, alongside issues of cronyism and lack of transparency in government dealings.

Armenia's economy has shown resilience and growth, with a GDP increase of 8.7 percent in 2023, driven by sectors such as trade, construction, and information technology. Despite its small market size and geographic isolation, the country has attracted significant foreign direct investment, particularly from the U.S. in energy, mining, and technology sectors, although challenges remain due to issues like corruption and weaknesses in the rule of law.

Armenia's investment climate is characterized by a generally open policy towards foreign investment, with U.S. companies actively participating in sectors such as energy, mining, banking, and technology. Despite improvements in the business environment and legal framework aimed at attracting investors, challenges remain, including a small market size, geographic isolation, and issues related to the rule of law and corruption. Recent years have seen net foreign direct investment inflows exceed the global average, indicating a growing interest in Armenia as an investment destination.