Malawi Country Summary

FATF Status

Malawi is not 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 Malawi was undertaken in 2024. According to that Evaluation, Malawi was deemed Compliant for 20 and Largely Compliant for 14 of the FATF 40 Recommendations. It was also deemed Highly Effective for 0 and Substantially Effective for 0 with regard to the 11 areas of Effectiveness of its AML/CFT Regime.

Corruption is pervasive in Malawi, with various forms of misconduct such as bribery and misuse of funds being common, despite legal frameworks like the Corrupt Practices Act and the establishment of the Anti-Corruption Bureau (ACB). Enforcement of anti-corruption measures is weak, and high-profile scandals continue to undermine public trust. Additionally, Malawi faces significant challenges with organized crime, including human trafficking, counterfeit goods, and environmental crimes, exacerbated by a fragile governance structure and limited law enforcement capabilities.

Malawi's economy is primarily focused on agriculture, which accounts for 30.4% of its GDP, and the government is actively pursuing foreign direct investment to boost productivity in agriculture, tourism, and mining. Despite having rich natural resources and potential for growth, the country faces significant challenges, including high inflation, inadequate infrastructure, and a scarcity of skilled labor, which hinder economic development. The Malawian economy grew by only 1.5% in 2023, with projections indicating a modest recovery in the coming years, but persistent issues such as forex scarcity and political risks remain a concern for investors.

Malawi is actively seeking to attract foreign direct investment, focusing on sectors such as agriculture, tourism, and mining, with the government aiming to significantly increase the mining sector's contribution to GDP. However, challenges such as inadequate infrastructure, a scarcity of skilled labor, and recent amendments to land laws that may hinder foreign ownership present obstacles for investors. Despite these challenges, the Malawi Investment and Trade Center provides support to navigate regulations and promote investment opportunities.