FATF status

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

Compliance with FATF Recommendations

It should be noted that the new style FATF Mutual Evaluation has not yet been undertaken.

The last Mutual Evaluation Report relating to the implementation of anti-money laundering and counter-terrorist financing standards in Nauru was undertaken by the Financial Action Task Force (FATF) in 2012. According to that Evaluation, Nauru was deemed Compliant for 4 and Largely Compliant for 11 of the FATF 40 + 9 Recommendations. It was Partially Compliant or Non-Compliant for 3 of the 6 Core Recommendations.

Nauru's economy has historically depended on phosphate mining, which peaked in the 1970s but has since declined due to resource depletion, leading to high unemployment and a reliance on foreign aid, particularly from Australia. Efforts to diversify the economy have been hampered by limited resources and financial mismanagement, resulting in a diminished trust fund meant to support the economy after phosphate reserves were exhausted.

Nauru's investment climate is hindered by economic instability and a heavy reliance on foreign aid, which has resulted in a lack of confidence among potential investors. Despite this, the government has made progress in reforming financial systems and improving tax transparency, which may open up new opportunities for foreign investment, particularly in deep-sea mining.