EU blacklists Botswana, Ghana, Mauritius, Zimbabwe over money-laundering

The European Union has blacklisted four African countries over money-laundering concerns as it says their financial transactions require further scrutiny.

Botswana, Ghana, Mauritius and Zimbabwe were part of 12 countries placed on the EU’s blacklist.

The other countries blacklisted are Bahamas, Barbados, Jamaica, Nicaragua, Panama, Cambodia, Mongolia and Myanmar.

But the blacklisting will have to be approved by the European parliament in order for it to come into force in October this year.

Blacklisted countries were assessed based on systemic impact on the integrity of the EU financial system.

They were also assessed after going through a review by the International Monetary Fund as international offshore financial centers and economic relevance and strong economic ties with the EU.

What affected countries have to do
These blacklisted countries would have to show more commitment towards tackling the problem to get off the list.

The EU said in a statement that “given the Coronavirus crisis, the date of application of today’s Regulation listing third countries – and therefore applying new protective measures – only applies as of 1 October 2020.

This is to ensure that all stakeholders have time to prepare appropriately. The delisting of countries, however, is not affected by this and will enter into force 20 days after publication in the Official Journal.”

In a statement the EU said “Bosnia-Herzegovina, Ethiopia, Guyana, Lao People’s Democratic Republic, Sri Lanka and Tunisia” have been taken off the blacklist after addressing the problem in their respective countries.

The EU commission’s executive vice-President Valdis Dombrovskis also said in a statement that “We need to put an end to dirty money infiltrating our financial system. Today we are further bolstering our defences to fight money laundering and terrorist financing, with a comprehensive and far-reaching Action Plan.”

Dombrovskis adds that “There should be no weak links in our rules and their implementation. We are committed to delivering on all these actions – swiftly and consistently – over the next 12 months. We are also strengthening the EU’s global role in terms of shaping international standards on fighting money laundering and terrorism financing.”

Signal of blacklisting

Last year the European Commission cited six African countries, namely Ghana, Botswana, Libya, Tunisia, Ethiopia and Libya for encouraging money laundering and terrorism financing.

The blacklisting according to the European Commission was to protect the EU financial system and prevent money laundering and terrorist financing risks.

But Ghana for example said in a statement last year that “the European Commission’s blacklist of Ghana does not reflect the current of Ghana’s anti-money laundering regime describing the move as unfortunate.”

Ghana maintained at the time that it was not given the opportunity to respond or implement corrective measures, which is the norm.