Philippines Country Summary

FATF Status

Philippines is no longer on the FATF List of Countries that have been identified as having strategic AML deficiencies.

Compliance with FATF Recommendations

The last follow up Mutual Evaluation Report relating to the implementation of anti-money laundering and counter-terrorist financing standards in the Philippines was undertaken in 2022. According to that Evaluation, the Philippines was deemed Compliant for 8 and Largely Compliant for 29 of the FATF 40 Recommendations. It remains Highly Effective for 0 and Substantially Effective for 1 with regard to the 11 areas of Effectiveness of its AML/CFT Regime.

The Philippines faces significant challenges related to crime and corruption, with pervasive issues in both public and private sectors exacerbated by the government's inadequate response to crises like the COVID-19 pandemic. Despite the existence of various anti-corruption laws and agencies, the judicial system suffers from inefficiency and corruption, while organized crime networks thrive, often linked to political patronage and foreign criminal organizations.

The Philippines is actively working to enhance its investment climate and recover from the economic impacts of the COVID-19 pandemic, with foreign direct investment (FDI) inflows rebounding significantly in 2021. Despite achieving a record FDI of USD 10.5 billion, the country still lags behind its ASEAN peers in attracting foreign investments, primarily due to challenges such as poor infrastructure, high costs, and regulatory inconsistencies. Recent legislative reforms aimed at liberalizing foreign ownership in various sectors, along with tax incentives under the CREATE Act, indicate a commitment to improving the investment landscape, although concerns about rising public debt and inflationary pressures remain prevalent.