Latest FATF Statement - 18 October 2013

São Tomé and Príncipe was earlier identified in the FATF’s Public Statement. While São Tomé and Príncipe has made recent progress, its AML/CFT framework still contains a number of strategic deficiencies. Given the small size of this country’s financial sector and its low impact on the international financial system, however, the FATF decided that São Tomé and Príncipe should continue to work closely with GIABA to address its remaining AML/CFT deficiencies.

Compliance with FATF Recommendations

The last Mutual Evaluation Report relating to the implementation of anti-money laundering and counter-terrorist financing standards in São Tomé and Príncipe was undertaken in 2024. According to that Evaluation, São Tomé and Príncipe was deemed Compliant for 5 and Largely Compliant for 11 of the FATF 40 Recommendations. It was deemed Highly Effective for 0 and Substantially Effective for 0 of the Effectiveness ratings.

São Tomé and Príncipe (STP) has made significant progress in combating corruption, as evidenced by its improved ranking on Transparency International’s Corruption Perception Index and the implementation of an anti-corruption law in 2012. The government has modernized customs procedures, leading to increased revenues and reduced corruption incidents, while also adopting an anti-money laundering law that aligns with international standards. Despite these advancements, STP lacks a designated agency for combating corruption and is not a party to certain international anti-bribery conventions.

São Tomé and Príncipe has a developing economy with a GDP of approximately $418.6 million and a population of around 215,056. The country heavily relies on foreign aid, with over 90% of its budget financed by international donors, including nations like China and Portugal. Despite efforts to improve its investment climate and attract foreign direct investment, challenges such as a weak domestic market and inadequate infrastructure persist.

São Tomé and Príncipe has made significant strides in enhancing its investment climate over the past decade, focusing on creating a transparent and corruption-free environment to attract foreign direct investment (FDI). Key reforms include the enactment of a modern Labor Code and a Value Added Tax Law, as well as the ratification of the African Continental Free Trade Agreement. Despite these improvements, challenges such as a weak domestic market, inadequate infrastructure, and high costs of credit continue to hinder foreign investors.