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, as highlighted by the WEF Global Competitiveness Index and Transparency International's 2023 Corruption Perceptions Index, which ranked Colombia 87th out of 180 countries. Despite the implementation of various anti-corruption laws and Colombia's commitment to international conventions, corruption persists in key areas such as customs and public contracting, with high-profile cases involving government officials. While the government has made efforts to combat corruption, including increasing private sector responsibilities, challenges remain in ensuring transparency and accountability.

Colombia's economy, with a population of 52.4 million, has faced significant challenges, expanding by only 0.6 percent 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 has been characterized by strong direct foreign investment in 2023, despite the administration of President Gustavo Petro introducing policies that have created uncertainty in key economic sectors. The economy faced a significant slowdown, with a 25 percent decrease in investment and a decline in key sectors such as construction and manufacturing, while the country remains below investment grade status. Additionally, concerns regarding proposed structural reforms and a lack of new tax incentives have further complicated the investment landscape.