FATF status

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

Compliance with FATF Recommendations

The last Mutual Evaluation Report relating to the implementation of anti-money laundering and counter-terrorist financing standards in Nauru was undertaken in 2024. According to that Evaluation, Nauru was deemed Compliant for 19 and Largely Compliant for 18 of the FATF 40 Recommendations. It was deemed Highly Effective for 0 and Substantially Effective for 0 of the Effectiveness ratings.

Nauru's economy has historically been centered around phosphate mining, which peaked in the 1970s but has since declined due to resource depletion. The country now heavily relies on foreign aid and has struggled to diversify its economy, facing significant financial challenges and high unemployment as a result of mismanagement and insufficient funds.

Nauru's investment climate has been negatively impacted by its historical dependence on phosphate mining and subsequent economic mismanagement, which has discouraged foreign investment. The government has made attempts to enhance tax transparency and attract investments, particularly in deep-sea mining and sustainable energy technology, but remains vulnerable due to its small size and limited resources. Although the reopening of the Nauru Regional Processing Centre has provided a temporary economic boost, the long-term sustainability of such initiatives is uncertain.