The Southern African Development Community (SADC), supported by the Strengthening National-Regional Linkages (SNRL) Programme, is intensifying its efforts to strengthen financial integrity and foster sustainable economic growth across the region through raising public awareness of the benefits and progress of SADC regional integration initiatives. The SNRL Programme, a SADC initiative funded by the German Federal Ministry for Economic Cooperation and Development (BMZ) and implemented by the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH, is prioritizing increased visibility with aim to build stronger regional cohesion and support for addressing critical challenges such as money laundering, terrorism financing, and proliferation financing in the SADC region.
At the helm of this initiative is the SADC Anti-Money Laundering and Combating the Financing of Terrorism (AML/CFT) Committee, established in 2023 under the SADC Protocol on Finance and Investment. Working closely with the Eastern and Southern Africa Anti-Money Laundering Group (ESAAMLG) Secretariat, the Committee leads regional strategies to mitigate financial crimes and their socio-economic consequences, advancing collaboration and resilience among Member States.
The Financial Action Task Force (FATF), the global watchdog for money laundering and terrorist financing, establishes international standards to prevent illicit activities and their societal impact. Recognizing the increasing complexity of money laundering and the need for robust countermeasures, the 2023 SADC Ministers of Finance meeting recommended amending Annex 12 of the SADC Protocol on Finance and Investment. These amendments aim to incorporate provisions on Countering the Financing of Terrorism (CFT) and Countering Proliferation Financing (CPF), ensuring alignment with FATF recommendations. The FATF framework outlines adaptable measures tailored to different national contexts, enabling countries to effectively combat money laundering and terrorism financing.
The 2nd meeting of the SADC AML/CFT Committee was held in Mahe, Seychelles in November 2024. The meeting was chaired by Mr. Clement Kapalu (Chairperson and Director General of the Financial Intelligence Unit (FIU) of the Republic of Zambia), supported by Mrs. Debra Port-Louis (Deputy Chairperson and Deputy Director of the FIU of the Republic of Seychelles).
The meeting reviewed proposed amendments to the SADC Protocol on Finance and Investment to enhance efficiency and effectiveness in its implementation. The amendments include the addition of proliferation financing as another risk facing the region alongside AML and CFT; the inclusion of Illicit Financial Flows (IFF) as a dimension of national risk assessments; and the incorporation of the African Union (AU) Convention on Preventing and Combating Crime into the list of relevant AU frameworks. Additionally, the amendments propose improved definitions of key terms, including beneficial owner, IFF, self-regulatory body, and unexplained wealth. The reviewed Annex 12 will be submitted for consideration and approval by the Ministers of Finance and Investment at their next meeting, planned for June/July 2025 in Zimbabwe.
SADC Member States are expected to integrate the FATF Recommendations into their respective AML/CFT frameworks. Mauritius leads in this regard, having incorporated all 40 FATF Recommendations. However, five Member States (Democratic Republic of Congo, Mozambique, Namibia, South Africa, and the United Republic of Tanzania) are currently grey listed by FATF due to deficiencies in their frameworks. Member States are encouraged to collaborate in addressing these deficiencies, with support from the SADC AML/CFT Committee. To build national capacities for compliance with FATF recommendations, additional assistance is available for from partners such as the EU Global Facility on Anti-Money Laundering and Countering the Financing of Terrorism (GF-AML/CFT), and the EU SecFin Africa Programme.
The establishment of the SADC AML/CFT Committee demonstrates the unwavering commitment of SADC Member States to combating money laundering and terrorism financing, marking a significant step toward safeguarding the region's financial integrity. Supported by the SNRL Programme, enhanced communication around SADC activities, exemplified by the work of the AML/CFT Committee, ensures a cohesive and transparent narrative of SADC’s achievements, fostering broader stakeholder engagement. As Member States collaborate to address remaining challenges, the region moves closer to building a robust framework that effectively prevents illicit financial activities and promotes sustainable economic growth. Achieving this, however, requires concerted effort and active engagement from key stakeholders, development partners, and the incorporation of all FATF Recommendations by all SADC Member States.
