FATF Status

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

Latest FATF Statement  -  25 June 2021

The FATF welcomes Ghana’s significant progress in improving its AML/CFT regime. Ghana has strengthened the effectiveness of its AML/CFT regime and addressed related technical deficiencies to meet the commitments in its action plan regarding the strategic deficiencies that the FATF identified in October 2018. Ghana is therefore no longer subject to the FATF’s increased monitoring process. Ghana will continue to work with GIABA to improve further its AML/CFT regime.

Compliance with FATF Recommendations

The last follow-up to the Mutual Evaluation Report relating to the implementation of anti-money laundering and counter-terrorist financing standards in Ghana was undertaken in 2022. According to that Evaluation, Ghana was deemed Compliant for 13 and Largely Compliant for 22 of the FATF 40 Recommendations. It remains Highly effective for 0 and Substantially Effective for 1 of the Effectiveness & Technical Compliance ratings.

US Department of State Money Laundering assessment (INCSR)

Ghana is categorised by the US State Department as a Country/Jurisdiction of Primary Concern in respect of Money Laundering and Financial Crimes.

Overview

Ghana continues to strengthen its anti-money laundering/combating the financing of terrorism (AML/CFT) laws.  The government is working to implement its AML/CFT regime across all sectors and institutions.  Ghana continues to consolidate its banking and financial sectors, with new capital requirements reducing the number of operating banks.  This consolidation, along with an incremental but positive trajectory of improved banking supervision, should aid authorities in prioritizing the allocation of resources.

The Ghanaian government worked to implement an agreed-upon, two-year AML/CFT action plan to ensure its AML/CFT system is effective.  In 2021, international experts indicated Ghana had made significant strides in strengthening its AML/CFT system and put adequate measures in place to make its regime effective.  

Non-profit organizations (NPOs) and designated non-financial businesses and professions

(DNFBPs), whose operations are largely cash-based, present significant money laundering/terrorist financing risks and continue to represent the largest gaps in Ghana’s AML/CFT regime.  

The government should continue to allocate adequate funding to fight money laundering, effectively implement relevant asset forfeiture laws and regulations, and sanction institutions that do not file suspicious transaction reports (STRs) and currency transaction reports, as required by Ghanaian law.

Rating                                                                           (100-Good / 0-Bad)

Transparency International Corruption Index                           43

World Governance Indicator – Control of Corruption             53

Corruption poses an obstacle for businesses operating or planning to invest in Ghana. Nonetheless, corruption levels in Ghana remain low compared to other African countries. Low-level government employees are known to ask for a 'dash' (tip) in return for facilitating license and permit applications. Ghanaian anti-corruption law is primarily contained in the Criminal Code, which criminalizes active and passive bribery, extortion, willful exploitation of public office, use of public office for private gain and bribery of foreign public officials. The Public Procurement Act, the Financial Administration Act and the Internal Audit Agency Act have been introduced to promote public sector accountability and to combat corruption. The government has a strong anti-corruption legal framework in place but faces challenges of enforcement. Gifts and other gratuities offered to civil servants in the aim of influencing their duties are illegal, nonetheless, facilitation payments are not defined in law. For further information - GAN Integrity Business Anti-Corruption Portal

Ghana’s economy encountered strong headwinds in 2022. Gross Domestic Product (GDP) growth which reached 5.4% in 2021, is estimated to have slowed to 3.2% in 2022, with projections of 1.6% GDP growth in 2023, according to the International Monetary Fund (IMF).  However, rising inflation, which reached just over 54% in December, but has since moderated slightly, and the rapid depreciation of the Ghanaian cedi, along with global supply chain constraints and fiscal shortfalls, have affected the economic outlook.  Russia’s invasion of Ukraine exacerbated these strains, provoking food and gas price hikes.  With international capital markets closed and domestic financing drying up, in July 2022, the President authorized the Finance Minister to enter into talks with the IMF to address the balance of payments crisis and the Government of Ghana (GOG) concluded a Staff-Level Agreement (SLA) for a $3 billion, three-year arrangement under the Extended Credit Facility (ESF) in December, pending IMF Board approval. Ghana suspended debt service payments on the majority of its external debt on December 19. Among the burdens weighing heavily on government finances are the sizeable arrears in the energy sector due to excess generation capacity, excess gas supply, high technical and commercial losses, and declining oil production.

The economy remains highly dependent on the export of primary commodities such as gold, cocoa, and oil, and consequently, is vulnerable to slowdowns in the global economy and commodity price shocks (but also benefits from high oil and gold prices). In general, Ghana’s investment prospects are in flux, as the Government of Ghana seeks to attract FDI in agro-processing, mining, and manufacturing but investor confidence is relatively low.  It has made attracting foreign direct investment (FDI) a priority to support its industrialization plans and to overcome an annual infrastructure funding gap.

Challenges to Ghana’s economy include high government debt, particularly energy sector debt, low revenue mobilization, corruption, and inefficient state-owned enterprises.  Ghana has a population of 31 million, with over 14 million potential taxpayers, but only six million of whom file their annual tax returns.  As Ghana looks to spur economic recovery and move beyond dependence on foreign aid, it must develop a solid domestic revenue base, while also reducing government expenditures.  On the energy front, Ghana has enough installed power capacity to meet current demand, but it needs to improve the management of its state-owned power distribution system to reduce financial and technical losses.

Among the challenges hindering foreign direct investment are costly financial services, lack of transparency and stakeholder engagement, corruption, under-developed infrastructure, a complex property market, costly and intermittent power and water supply, the high costs of cross-border trade, a burdensome bureaucracy, and an unskilled labor force.  Enforcement of laws and policies is weak, even where good laws exist on the books.  Public procurements are sometimes opaque, and there are often issues with delayed payments.  In addition, there have been troubling trends in investment policy over the last seven years, with the passage of local content regulations in the petroleum, power, and mining sectors that may discourage needed future investments.

Despite these challenges, Ghana’s abundant raw materials (gold, cocoa, and oil/gas), relative security, and political stability, as well as its hosting of the African Continental Free Trade Area (AfCFTA) Secretariat make it stand out as one of the better locations for investment in sub-Saharan Africa.  Investment laws protect investors against expropriation and nationalization and guarantee that investors can transfer profits out of the country, although international companies have reported high levels of corruption in dealing with Ghanaian government institutions.

Among the most promising sectors are agribusiness and food processing; ICT and business-related services; textiles and apparel; downstream oil, gas, and minerals processing; construction and real estate; and mining-related services subsectors.

The government has acknowledged the need to strengthen its business enabling environment to attract FDI, and is taking steps to overhaul the regulatory system, improve the ease of doing business, and restore fiscal discipline.

Country Links

Financial Intelligence Centre Ghana ( FIC)

Bank of Ghana