FATF status

Saudi Arabia is not currently 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 Saudi Arabia was undertaken by the Financial Action Task Force (FATF) in 2020. According to that Evaluation, Saudi Arabia was deemed Compliant for 17 and Largely Compliant for 21 of the FATF 40 Recommendations. It remains Highly effective for 0 and Substantially Effective for 4 of the Effectiveness & Technical Compliance ratings.

Saudi Arabia has established the Oversight and Anti-Corruption Commission (Nazaha) to promote transparency and combat corruption, reporting directly to King Salman and capable of dismissing government employees even if not found guilty by courts. While the country has a comprehensive legal framework against corruption, enforcement is perceived as selective, with significant penalties for bribery and money laundering, yet issues like nepotism and the influence of the royal family persist in business practices. Despite ratifying international anti-corruption agreements and improving procurement transparency, companies still face high corruption risks, particularly due to the intertwining of business and politics.

In 2023, Saudi Arabia's economy is undergoing significant transformation under the Vision 2030 initiative, which aims to diversify its economic base away from oil dependency and foster private sector growth. The government is actively seeking foreign investment in various sectors, including infrastructure, tourism, and renewable energy, while also facing challenges such as budget deficits and concerns over business predictability and transparency.

Saudi Arabia's investment climate is shaped by the government's Vision 2030 initiative, which seeks to diversify the economy and attract $3 trillion in foreign investment across various sectors, including infrastructure, tourism, and renewable energy. While the Kingdom offers significant opportunities, challenges such as business predictability, transparency issues, and increased costs due to 'Saudization' policies may deter some investors. Nonetheless, reforms aimed at improving the ease of doing business, such as reducing license approval times and allowing 100% foreign ownership in most sectors, indicate a commitment to enhancing the investment environment.