FATF Status

Vietnam is on the FATF List of Countries that have been identified as having strategic AML deficiencies

Latest FATF Statement - 21 February 2025

Since June 2023, when Vietnam made a high-level political commitment to work with the FATF and APG to strengthen the effectiveness of its AML/CFT regime, Vietnam has made limited progress. The FATF strongly encourages Vietnam to coordinate internally to demonstrate progress on its action plan to address its strategic deficiencies, including by: (1) increasing risk understanding, domestic co-ordination and co-operation to combat ML/TF; (2) enhancing international co-operation; (3) implementing effective risk-based supervision for FIs and DNFBPs; (4) taking action to regulate virtual assets and virtual asset service providers; (5) addressing technical compliance deficiencies, including with respect to the ML offence, targeted financial sanctions, customer due diligence and suspicious transaction reporting; (6) conducing outreach activities with the private sector; (7) establishing a regime that provides competent authorities with adequate, accurate and up-to-date information on beneficial ownership; (8) ensuring the independence of the FIU and enhancing the quality and quantity of financial intelligence analysis and disseminations; (9) prioritizing parallel financial investigations and demonstrating an increase in the number of ML investigations and prosecutions undertaken; and (10) demonstrating that there is monitoring of FIs and DNFBPs for compliance with PF TFS obligations and that there is co-operation and co-ordination between authorities to prevent PF TFS from being evaded.

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 Vietnam was undertaken in 2024. According to that Evaluation, Vietnam was deemed Compliant for 2 and Largely Compliant for 12 of the FATF 40 Recommendations. It remains Highly Effective for 0 and Substantially Effective for 2 of the Effectiveness ratings.

Vietnam has established laws to combat corruption, with a significant focus from CPV General Secretary Nguyen Phu Trong, who has prioritized anti-corruption efforts and created various agencies to address the issue. Despite these initiatives, corruption remains widespread due to low transparency, inadequate accountability, and poor remuneration for officials, leading to bureaucratic inefficiencies that foster corrupt practices. While the legal framework criminalizes various forms of corruption, enforcement is weak, and issues like bribery and facilitation payments persist in the business environment.

Vietnam's economy is significantly driven by foreign direct investment (FDI), which reached a stock of $297 billion by the end of 2023. The government promotes a favorable environment for FDI, particularly in export-oriented manufacturing, supported by political stability, a young workforce, and numerous trade agreements. However, challenges such as corruption, regulatory uncertainty, and a reliance on imports from China pose risks to its economic growth.

Vietnam's investment climate is characterized by a strong emphasis on attracting foreign direct investment (FDI), which is crucial for its economic growth. The government has implemented policies that favor export-oriented manufacturing and has made significant strides in establishing free trade agreements to enhance market access. However, challenges such as corruption, regulatory uncertainty, and a lack of skilled labor continue to pose obstacles for foreign investors.