Nigeria and South Africa could be removed from the FATF grey list next month after recent assessments.
The October 24 Paris plenary will decide, following reforms against money laundering and terror financing.
Nigeria and South Africa may soon exit the Financial Action Task Force (FATF) grey list, with a decision expected as early as next month, Bloomberg has reported, citing individuals close to the process.
The Paris-based body, which monitors global efforts against money laundering and terror financing, placed both countries under stricter observation in February 2023, pointing to gaps in curbing illicit financial activities. However, FATF teams that carried out recent assessments reportedly noted clear improvements, creating an opportunity for removal.
According to the report, the final decision is scheduled for October 24 during the FATF plenary session in Paris. Burkina Faso and Mozambique are also being reviewed, with their removal dependent on the approval of FATF’s 40 member states.
Lauren van Biljon, senior portfolio manager at Allspring Global Investments, observed that leaving the grey list would show that reforms introduced since last year are beginning to produce results. She added that while the financial markets might not see a dramatic shift, the development could provide a temporary boost for asset prices.
Countries under grey-listing typically experience stricter oversight of their financial systems and difficulties in attracting foreign investment. Nigeria has taken steps to address FATF’s concerns, with the Nigerian Financial Intelligence Unit announcing in June that the watchdog had approved an on-site review after progress in combating financial crimes.
In July, the federal government disclosed that over 730 people had been convicted for terrorism-related offences, describing the outcome as proof of stronger enforcement. The October meeting in Paris will determine whether Nigeria and South Africa can finally exit the additional monitoring regime and strengthen investor trust in their economies.
