Eritrea Country Summary
Higher Risk
View full Ratings TableSanctions
Higher Concern
FATF AML Deficient List
Medium Concern
Terrorism
Medium Concern
Corruption
Higher Concern
US State ML Assessment
Lower Concern
Criminal Markets (GI Index)
Medium Concern
EU Tax Blacklist
Lower Concern
Offshore Finance Center
Lower Concern
Please note that although the below Summary will give a general outline of the AML risks associated with the jurisdiction, if you are a Regulated entity then you may need to demonstrate that your Jurisdictional AML risk assessment has included a full assessment of the risk elements that have been identified as underpinning overall Country AML risk. To satisfy these requirements, we would recommend that you use our Subscription area.
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Anti Money Laundering
FATF Status
Eritrea is not on the FATF List of Countries that have been identified as having strategic AML deficiencies
Compliance with FATF Recommendations
Eritrea has not yet undertaken a Mutual Evaluation Report relating to the implementation of anti-money laundering and counter-terrorist financing standards.
Sanctions
Active sanctions against Eritrea by other nations are currently maintained by the United States (OFAC), Australia, and Canada, including asset freezes, travel bans, and trade restrictions targeting Eritrean military officials, the Eritrean Defense Forces, and entities such as Hidri Trust and Red Sea Trading Corporation. UN sanctions are not currently in force, having been lifted in 2018, and other major actors such as the EU, UK, Japan, New Zealand, Switzerland, and the Arab League have no autonomous or active measures against Eritrea.
Criminality
Rating |
0 (bad) - 100 (good) |
|---|---|
| Transparency International Corruption Index | 13 |
| World Bank: Control of Corruption Percentile Rank | 6 |
Eritrea faces significant challenges related to crime and corruption, characterized by institutionalized corruption and limited transparency within the government. While laws exist to combat corruption, their enforcement is unclear, and the absence of independent oversight or civil society organizations exacerbates the situation, leaving citizens vulnerable to both petty and systemic corruption.
The country grapples with severe issues such as human trafficking and smuggling, driven by strict government controls and exploitation of citizens through forced labor. Organized crime is largely state-embedded, with the People's Front for Democracy and Justice and military actors playing central roles, while the judiciary remains weak and dependent on government influence, contributing to a climate of impunity and limited resilience against criminal activities.
Economy
Eritrea's economy presents significant challenges for foreign investment, particularly from the U.S., due to stringent government controls, a lack of a commercial code, and economic sanctions. The state dominates the economy, with most large enterprises either state-owned or controlled by the ruling People's Front for Democracy and Justice (PFDJ), while the private sector consists mainly of small, family-owned businesses. Furthermore, the national currency is non-convertible, and there are severe restrictions on profit repatriation, making the investment climate highly unfavorable and opaque, with little transparency or legal recourse for investors.
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