On 24 October 2025, South Africa reached a major milestone when the Financial Action Task Force (FATF) officially removed the country from its list of jurisdictions under increased monitoring, commonly known as the “greylist.”
South Africa was originally greylisted in February 2023 after shortcomings were identified in its systems for combating money laundering and terrorist financing. Since then, the country has made substantial progress, completing all 22 required action items to address these deficiencies. Following an on-site review by the Africa Joint Group, FATF confirmed that not only had South Africa implemented these reforms but was also applying them effectively.
This marks a meaningful step forward for the country’s financial standing and reputation. But what does this mean for investors and financial markets?
What This Means for the Economy and Financial System
The FATF announcement has been met with relief across markets and institutions. While this is undoubtedly positive news, it does not mean the work is over. Both the Financial Sector Conduct Authority (FSCA) and the Financial Intelligence Centre (FIC) have emphasized that regulatory expectations remain stringent.
The FSCA has stated that its supervisory intensity will remain unchanged, continuing on-site inspections to ensure compliance systems are not only implemented but integrated into daily operations. The FIC echoed this sentiment, calling the delisting “the start of a longer-term commitment” rather than the end of the process.
South Africa’s next FATF mutual evaluation begins in 2026 and concludes in 2027, during which regulators will be looking for measurable results such as successful investigations, prosecutions, and sanctions related to anti-money laundering and counter-terrorist financing. The key message is clear: maintaining the progress achieved so far will be essential to keeping South Africa off the greylist for good.
A Look at the Market Reaction
Despite initial fears in 2023, South Africa’s greylisting had limited lasting impact on local financial markets. In fact, since then, we have seen significant positive performance across domestic asset classes, with equities, bonds, and property all rallying. The rebound in local markets has largely been sentiment-driven. While the greylisting contributed to negative market sentiment in 2023, the real drivers of performance were a widening fiscal deficit and political uncertainty ahead of the 2024 elections. As confidence has improved, aided by lower inflation and more stable macroeconomic conditions, risk appetite has returned, lifting South African asset prices accordingly.
In Summary
South Africa’s exit from the FATF greylist is a welcome signal of institutional progress and a step toward restoring global confidence. It reflects a commitment to stronger governance, transparency, and financial system integrity.
For investors, the implications are more reputational than fundamental, but nonetheless constructive. As always, our focus remains on identifying value, managing risk, and maintaining diversified portfolios designed to deliver long-term outcomes across market cycles.
If you have any questions about your portfolio positioning or would like to discuss the market implications in more detail, please don’t hesitate to reach out.