FATF status

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

Latest FATF Statement - 25 October 2024

Since October 2022, when Mozambique made a high-level political commitment to work with the FATF and ESAAMLG to strengthen the effectiveness of its AML/CFT regime, Mozambique has taken steps towards improving its AML/CFT regime, including by improving the risk-based supervision of FIs and DNFBPs, increasing the resources available to its FIU, and providing training to the FIU on the implementation of targeted financial sanctions. Mozambique should continue to work on implementing its action plan to address its strategic deficiencies, including by: (1) implementing a risk-based supervision plan, including the implementation of remedial actions and effective and proportionate sanctions; (2) increasing financial intelligence sent to authorities; (3) demonstrating LEAs’ capability to effectively investigate a range of ML offences using financial intelligence; (4) demonstrating the ability to identify TF cases; and (5) carrying out a risk assessment for NPOs in line with the FATF Standards and using it as a basis to develop an outreach plan.

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 Mozambique was undertaken in 2024. According to that Evaluation, Mozambique was deemed Compliant for 5 and Largely Compliant for 8 of the FATF 40 Recommendations. It remains Highly Effective for 0 and Substantially Effective for 0 of the Effectiveness ratings.

Corruption remains a significant issue in Mozambique, particularly affecting the agricultural sector where an alleged cartel has blocked exports, leading to substantial financial losses for international companies. Despite some progress in anti-corruption reforms and legal changes aimed at improving the country's anti-money laundering framework, the government continues to face challenges in effectively implementing these measures. Additionally, the legacy of the hidden debts scandal has prompted ongoing legal actions and civil society advocacy for accountability, highlighting the persistent struggle against corruption in various sectors.

Mozambique has significant investment potential due to its extensive coastline, deep-water ports, and abundant natural resources, including coal and natural gas. However, the economy faces challenges such as high corruption levels, poor infrastructure, and an insurgency in the northern Cabo Delgado Province, which has hindered major projects. Recent government reforms aim to improve the business environment, but issues like labor laws and a lack of skilled workers continue to pose obstacles.

Mozambique's investment climate is characterized by significant potential due to its natural resources, deep-water ports, and agricultural opportunities. However, challenges such as corruption, high interest rates, and poor infrastructure hinder foreign investment. Recent reforms, including a revised investment law aimed at improving the business environment, indicate the government's commitment to attracting foreign direct investment.