By Ntombi Mhlongo
Minister of Finance, Neal Rijkenberg has not disputed that the Kingdom of Eswatini will be impacted by the greylisting of its trade partner and neighbour, South Africa.
Speaking in Parliament during a committee sitting for the budget and Annual Performance Report of the Ministry of Finance, the minister said there is a high risk that Eswatini will be affected.
“The risk is there. Possibly, it is going to affect the cost of debt for our domestic funding at some point. But I am hopeful that South Africa will do just as Eswatini did when it found itself faced with the same challenge even though the situation was not the same,” the Minister said.
Read More: South Africa, Nigeria greylisted by FATF
He mentioned that he was confident that South Africa will do the right thing to rectify the situation. Last week, it was announced that South Africa has been greylisted by global the financial crime watchdog, the Financial Action Task Force (FATF) for not fully complying with international standards for the prevention of money laundering, terrorist financing and proliferation financing.
Economic experts have argued that greylisting has the potential to cause a retraction in foreign direct investment into South Africa as investors gravitate towards economies with less uncertainty.
Greylisting means that a country is under increased monitoring by the FATF due to certain deficiencies in its anti-money laundering (AML) and combatting the financing of terrorism (CFT) and proliferation financing (CPF) framework.
Read More: South Africa added to grey list
It is different from “blacklisting”, which is applied to countries that do not cooperate with the FATF, in that the greylisted countries commits to addressing the strategic inadequacies to combat money laundering and terrorist financing within a given timeframe.
Once a country is added to the FATF grey list, it is typically also added to the EU’s high-risk countries, flagging the need for increased due diligence, including the UK’s “high-risk jurisdictions” list.
