FATF Status

Malawi 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 Malawi was undertaken in 2024. According to that Evaluation, Malawi was deemed Compliant for 20 and Largely Compliant for 14 of the FATF 40 Recommendations. It was also deemed Highly Effective for 0 and Substantially Effective for 0 with regard to the 11 areas of Effectiveness of its AML/CFT Regime.

Corruption is a pervasive issue in Malawi, affecting all levels of government and various sectors of the economy, despite the existence of anti-corruption laws such as the Corrupt Practices Act. The independent Anti-Corruption Bureau (ACB) is under-resourced and faces political challenges, leading to insufficient enforcement of anti-corruption measures. Although there have been some legal amendments to expedite prosecution and encourage transparency, compliance with asset declarations and conflict of interest disclosures remains low, making corruption a significant barrier for businesses operating in the country.

Malawi's economy is primarily focused on agriculture, which constitutes 22.1% of its GDP, and the government is implementing the "ATM strategy" to enhance productivity in agriculture, tourism, and mining. Despite having significant mineral deposits and a growing tourism sector, the economy faces challenges such as high inflation, inadequate infrastructure, and a scarcity of skilled labor, which hinder business operations and economic growth.

Malawi's investment climate is characterized by the government's commitment to attracting foreign direct investment, particularly in agriculture, tourism, and mining, as part of its "ATM strategy." Despite the potential for growth in sectors like mining, where the government aims to increase GDP contribution from 1% to 20%, challenges such as inadequate infrastructure, skilled labor shortages, and recent amendments to land laws affecting foreign ownership pose significant hurdles for investors.