FATF Status

Colombia 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 Colombia was undertaken in 2023. According to that Evaluation, Colombia was deemed Compliant for 12 and Largely Compliant for 18 of the FATF 40 Recommendations. It remains Highly Effective for 0 and Substantially Effective for 4 of the Effectiveness & Technical Compliance ratings.

Corruption remains a significant barrier for businesses in Colombia, affecting various sectors and the overall investment climate. The country ranks 87th out of 180 in Transparency International's Corruption Perceptions Index, indicating ongoing challenges despite some improvements. Colombia has enacted several anti-corruption measures, including adopting international conventions and domestic laws to combat bribery and enhance transparency, yet issues persist, particularly in public contracting and high-level government positions.

Colombia's economy, with a population of 52.4 million, has faced significant challenges, experiencing only a 0.6 percent growth in 2023 after a strong post-pandemic recovery. Contributing factors to this slowdown include a 25 percent decrease in investment, high interest rates, and a decline in key sectors such as construction and manufacturing, while public administration helped mitigate some of these setbacks through increased government spending.

Colombia's investment climate is characterized by a strong legal framework for foreign direct investment (FDI), bolstered by the 2012 U.S.-Colombia Trade Promotion Agreement, which has improved dispute settlement mechanisms. However, the Petro administration's focus on domestic sovereignty and proposed reforms in key sectors have created uncertainty among investors, contributing to a 25 percent decrease in investment and a deteriorating business climate. Despite these challenges, FDI grew by 1.5 percent between 2022 and 2023, indicating some resilience in attracting foreign capital.