Central African Republic
UN and EU
FATF AML Deficiency List
Non - Compliance with FATF MER Recommendations
Corruption Index (Transparency International & W.G.I.)
World Governance Indicators (Average Score)
The last Mutual Evaluation Report relating to the implementation of anti-money laundering and counter-terrorist financing standards in the Central African Republic was undertaken in 2010. According to that Evaluation, the Central African Republic was deemed Compliant for 0 and Largely Compliant for 10 of the FATF 40 + 9 Recommendations.
US Department of State Money Laundering assessment (INCSR)
Central African Republic was deemed a ‘Monitored’ Jurisdiction by the US Department of State 2016 International Narcotics Control Strategy Report (INCSR). Key Findings from the report are as follows: -
The Central African Republic (CAR) is not a major financial center and has an extremely limited banking sector. The economy is almost entirely cash-based, and enforcement of existing AML laws is weak. The level of violence in the country led to the removal of the former president in early 2013 and a subsequent three-year political transition period. The CAR is a member of the Economic and Monetary Community of Central Africa (CEMAC) and shares a regional central bank, the Bank of Central African States (BEAC), with other members. The lack of a cohesive national security force and porous borders allow cross-border activities to go undetected. Smuggling of contraband, including diamonds and arms, occurs across the unsecured border areas with Chad and Sudan. Undocumented trade across the river with Democratic Republic of Congo, which consists primarily of timber and domestic and agricultural goods, also occurs. The CAR is also a source and transit country for the trafficking of persons. There is little information on the extent of the drug trade or any resulting financial transactions in the CAR. Corruption is endemic throughout all levels of commerce and government.
The UN has issued an arms embargo against the CAR, and the UN, EU, and United States have imposed travel restrictions and asset freezes against former government officials and leaders of rebel groups that undermine the peace, stability, or security of the CAR or threaten or impede the political transition process or the stabilization and reconciliation process, or that promote violence.
In December 2013, pursuant to resolution 2127 (2013), the UN imposed an arms embargo, travel ban and asset freeze restrictions against the Central African Republic.
12 March 2014 - Council Regulation (EU) No 224/2014 of 10 March 2014 was imposed concerning restrictive measures in view of the situation in the Central African Republic
The EU measures target persons engaging in or supporting acts that undermine the peace, stability or security of the CAR and also imposes a wide range of economic and military restrictions, prohibiting the provision of technical assistance or brokering services in the CAR, in relation to goods and technology listed in the Common Military List of the European Union.
BRIBERY & CORRUPTION
Rating (100-Good / 0-Bad)
Transparency International Corruption Index 26
World Governance Indicator – Control of Corruption 11
Corruption is a very high risk for companies operating in the Central African Republic (CAR). After a government coup in 2013, political instability and widespread violence significantly undermined the rule of law. Pre-coup corruption was already a problem, but the ongoing insecurity has further exacerbated corruption, which in turn perpetuates the fragility of the state. Investors should be aware that bribery and extortion are pervasive throughout the country, and impunity is a severe problem. CAR has ratified the United Nations Convention Against Corruption, but efforts to curtail corruption are minimal. For further information - GAN Integrity Business Anti-Corruption Portal
Subsistence agriculture, together with forestry and mining, remains the backbone of the economy of the Central African Republic (CAR), with about 60% of the population living in outlying areas. The agricultural sector generates more than half of GDP. Timber and diamonds account for most export earnings, followed by cotton. Important constraints to economic development include the CAR's landlocked geography, poor transportation system, largely unskilled work force, and legacy of misdirected macroeconomic policies. Factional fighting between the government and its opponents remains a drag on economic revitalization. Distribution of income is extraordinarily unequal. Grants from France and the international community can only partially meet humanitarian needs.
Since 2009, the IMF has worked closely with the government to institute reforms that have resulted in some improvement in budget transparency, but other problems remain. The government's additional spending in the run-up to the 2011 election worsened CAR's fiscal situation. In 2012, the World Bank approved $125 million in funding for transport infrastructure and regional trade, focused on the route between CAR's capital and the port of Douala in Cameroon. After a two-year lag in donor support, the IMF's first review of CAR's extended credit facility for 2012-15 praised improvements in revenue collection but warned of weak management of spending.
Kimberley Process participants partially lifted the ban on diamond exports from the country in 2015, but persistent insecurity will prevent GDP from recovering to its pre-2013 level.
Agriculture - products:
cotton, coffee, tobacco, cassava (manioc, tapioca), yams, millet, corn, bananas; timber
gold and diamond mining, logging, brewing, sugar refining
Exports - commodities:
diamonds, timber, cotton, coffee
Exports - partners:
Norway 52.2%, China 14.1%, Democratic Republic of the Congo 8.3% (2015)
Imports - commodities:
food, textiles, petroleum products, machinery, electrical equipment, motor vehicles, chemicals, pharmaceuticals
Imports - partners:
Norway 39.6%, France 6.8%, US 4.6% (2015)
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