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.

In Saudi Arabia, the Oversight and Anti-Corruption Commission, known as Nazaha, was established to enhance transparency and combat corruption, reporting directly to King Salman. Despite a comprehensive legal framework addressing corruption, enforcement is perceived as selective, with significant penalties for bribery and money laundering. The country has made strides in international anti-corruption efforts, but corruption remains a high risk for businesses, influenced by nepotism and a lack of regulation on conflicts of interest.

In 2023, Saudi Arabia's economy is undergoing significant transformation under the Vision 2030 initiative, which aims to diversify its economic sectors beyond oil and create private sector jobs for its growing population. The government is actively seeking foreign investment in areas such as infrastructure, tourism, and renewable energy, while also facing challenges related to business predictability and increased operational costs due to local employment policies. Despite a budget deficit projected for 2023, the Kingdom's strategic investments and ambitious projects like NEOM and various economic cities signal a commitment to long-term economic growth.

Saudi Arabia's investment climate is characterized by the government's Vision 2030 initiative, which aims 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, and political risk persist, compounded by policies like increased fees for expatriate workers and 'Saudization' requirements that may deter foreign investors. Despite these concerns, the government has implemented reforms to streamline the investment process and promote foreign ownership in most sectors.