Kuwait Country Summary

FATF Status

Kuwait is on the FATF List of Countries that have been identified as having strategic AML deficiencies.

Compliance with FATF Recommendations

The latest Mutual Evaluation Report relating to the implementation of anti-money laundering and counter-terrorist financing standards in Kuwait was undertaken in 2024. According to the follow-up Evaluation, Kuwaitwas deemed Compliant for 9 and Largely Compliant for 20 of the FATF 40 Recommendations. It was deemed Highly effective for 0 and Substantially Effective 0 of the Effectiveness ratings.

Kuwait has intensified its efforts to combat corruption in recent years, responding to public dissatisfaction with increased prosecutions of government officials involved in financial misconduct. Despite these measures, challenges remain, particularly in the areas of transparency, accountability, and the implementation of anti-corruption laws, which are hindered by political struggles and executive pressure on the justice system.

Crime in Kuwait is multifaceted, with significant issues including human trafficking, a thriving counterfeit market, and rising cybercrime, particularly targeting the financial sector. The resilience of the country against these criminal activities is undermined by limited civil society engagement, strict censorship laws, and inadequate support for victims, particularly among vulnerable migrant populations.

Kuwait's economy is predominantly driven by its substantial oil reserves, which account for over half of its GDP and more than 90% of government revenue. Despite being a significant player in the global oil market, with 6% of the world's proven oil reserves, the economy faces challenges in diversifying away from oil dependency, compounded by a slow bureaucratic process and restrictive economic policies. Recent reforms, including the introduction of a foreign direct investment law that allows for 100% foreign ownership in certain sectors, aim to enhance the investment climate and attract foreign capital, although the business environment remains complex due to legal inconsistencies and a high level of government control over key industries.