The addition of Botswana by the European Union (EU) on a list of countries that are into money laundering and terrorism financing may not lead to further impact on financial transactions between the EU and Botswana.
Speaking to The Southern African Times on Wednesday, Head of the EU Delegation to Botswana and SADC, Jan Sadek said the commitment and serious efforts shown by Botswana to address deficiencies are important for all these reasons and will facilitate the swift restoration of the normal situation once the country will be delisted.
The EU has recently announced that Botswana is one the four African countries that face a possible listing under the Money Laundering and Terrorism Financing (ML-TF).
In October 2018, the Financial Action Task Force (FATF) placed Botswana on the list of high-risk for money laundering and terrorism financing.
Sadek has told The Voice in an interview that since then the EU has been working closely with the government of Botswana on Anti Money Laundering and Countering the Financing of Terrorism (AML-CFT).
“Consequently, the EU informed the Government about the separate EU listing for high risk jurisdictions presenting strategic deficiencies notably the fact that countries listed by the FATF will be listed on the EU list,” explained Sadek.
He explained that under Article 9 of Directive (EU) 2015/849 – the 4th Anti-money Laundering Directive (4AMLD), the Commission is mandated to adopt such a list in order to protect the EU financial system.
Since the October 2018 listing, Sadek says Botswana has taken a high level commitment to address the deficiencies and has worked closely with the EU and other partners such as the International Monetary Fund (IMF) and the U.S and UK Treasuries.
“The EU has been able to monitor the progress and has acknowledged efforts made by Botswana and is confident that if efforts are maintained, the country will build a stronger and sustainable AML-CFT system allowing it to be removed from the FATF list,” he said.
According to the Ambassador, the new EU list published recently is an update of the 2016 EU list, which is currently applied by the Union.
“The objective of the new list is to reflect the recent assessments completed by the FATF which included Botswana,” he said, adding that the revised list has been submitted for approval to the EU Parliament and EU Council.
Due to the current Covid-19 pandemic, Sadek said for newly listed countries like Botswana, the listing will effectively come into force on the 1st of October, 2020.
This can imply extra delays, but transactions made by EU financial entities with persons established in the concerned listed country are neither forbidden nor blocked,” he said.
Since the listing by FATF, Sadek said no economic impact on Botswana has been evidenced due to measures applied in response to the listing by the FATF.
“Also, the EU Delegation has not heard about any specific situation where a company in Botswana was prevented to continue its business with the EU,” he noted.
As a result, Sadek is optimistic that the listing of Botswana by the EU may not necessarily lead to further substantial impact on financial transactions between the EU and Botswana.
Permanent Secretary in the Finance Ministry, Dr Wilfred Mandlebe has noted that government takes the issue seriously as it has the potential of tarnishing the image and international profile of the country.
Mandlebe said the country remains committed to the global fight against money laundering and terrorist financing and says Botswana will work with all technical assistance providers, including the EU, to ensure compliance with the relevant authorities.
