UAE announces its official removal from the FATF "grey" list

The removal of the United Arab Emirates, which accommodates the Dubai financial center, from a global watchdog's list of countries susceptible to illicit money transfers represents a noteworthy accomplishment for the country that may bolster its international standing and attract greater foreign investment.

The Financial Action Task Force (FATF), an international organization dedicated to combating financial crimes, officially removed the UAE from its 'grey list' of approximately two dozen nations deemed high-risk for financial activities.

In 2022, the UAE came under increased scrutiny when the FATF identified concerns regarding money laundering and terrorist financing, particularly in sectors such as banking, precious metals, real estate, and stones. This removal from the list represents a triumph for the UAE, which has transformed from a regional trading hub to one of the world's wealthiest nations following the discovery of oil in Abu Dhabi in the late 1950s.

The Minister of Foreign Affairs, who is the brother of President Mohamed bin Zayed Al Nahyan, led efforts to address these concerns, demonstrating a national commitment to enhancing anti-money laundering measures.

John Kartonchik, a director at the UAE-based think tank Re/think, suggested that this development could instill greater confidence among investors, potentially attracting more foreign capital into the country. Moreover, financial institutions operating in the UAE may benefit from reduced compliance costs associated with serving affluent clients, thereby fostering a more conducive business environment.

Despite its gray-listed status, the UAE has continued to attract high-net-worth individuals globally and has emerged as a preferred destination for cryptocurrency firms and Russian investors, particularly amid geopolitical tensions.

Dubai's luxury real estate market ranked among the top globally in 2022, trailing only behind major cities like New York, Los Angeles, and London, while the UAE has also ascended to become the world's leading trading hub for rough diamonds, surpassing Belgium.

Looking ahead, Jonny Bell, director of financial crime compliance and payments at LexisNexis Risk Solutions, emphasized the UAE's ongoing commitment to enhancing anti-money laundering and counter-terrorism financing measures.

As Gulf states intensify efforts to diversify their economies beyond oil, attracting foreign investment becomes pivotal, with the UAE implementing various measures such as enhancing financial investigations, bolstering international cooperation, and aligning virtual asset regulations with global standards to remain competitive in attracting capital from abroad.

Read also: UAE Police Cautions drivers against making noise in residential areas

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