Nigeria Country Summary

FATF Status

Nigeria is 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 Nigeria was undertaken in 2024. According to that Evaluation, Nigeria was deemed Compliant for 13 and Largely Compliant for 23 of the FATF 40 Recommendations. It was assessed Highly Effective for 0 and Substantially Effective for 0 of the Effectiveness ratings.

Corruption remains a significant barrier to economic growth and poverty alleviation in Nigeria, with widespread bribery reported in customs and port operations. Despite the establishment of agencies like the Economic and Financial Crimes Commission (EFCC) and the Independent Corrupt Practices and Other Related Offences Commission (ICPC) to combat corruption, enforcement challenges persist due to underfunding, lack of independence, and insufficient legal frameworks, leading to a low public trust in governance and law enforcement.

Nigeria's economy, the second largest in Africa as of 2023, is experiencing moderate growth, with real GDP increasing by 2.9% following a 3.3% rise the previous year. Despite this growth, the country faces significant challenges, including soaring inflation rates that reached a 28-year high of 28.9% in December 2023, largely driven by rising energy and food prices, and worsening poverty levels affecting 104 million people. The government, under President Bola Tinubu, has initiated difficult economic reforms aimed at liberalizing the foreign exchange market and addressing fuel subsidies, which are expected to foster foreign investment and improve economic conditions in the medium to long term.

However, Nigeria's investment climate is hindered by systemic corruption, a protectionist trade regime, and an underdeveloped power sector, which collectively deter foreign investment. The country ranks poorly on Transparency International's Corruption Perception Index, and businesses often cite corruption as a major barrier to operations. Additionally, the security situation, marked by insurgencies and violent crime, poses significant risks for investors, further complicating the economic landscape and limiting growth potential.