The United Arab Emirates needs more time to show it’s done enough to be removed from a global financial crimes watchdog’s “gray list,” a senior government official said, as the Gulf country remains under scrutiny as a haven for dubious money dealings.
A major issue left to tackle to escape the designation is “the effectiveness of the implementation,” Abdullah bin Touq Al Marri, the UAE’s minister of economy, said in an interview with Bloomberg Television on Tuesday.
“We provided a lot of our policies, a lot of our regulations, but effectiveness means that you need to enforce fines and so forth,” he said. “That will only come through time.”
Just over a year ago, the Paris-based Financial Action Task Force placed the UAE on its list of countries subject to greater oversight for shortcomings in tackling illicit finance and terrorist financing, complicating local operations for Wall Street banks and multinationals that use Dubai as their Middle Eastern hub.
The government has previously said it’s made progress in monitoring inflows of money.
But the UAE has remained in the spotlight, especially with the arrival of rich Russians looking for a safe haven for their money after the invasion of Ukraine.
While local authorities had initially received 58 action items from the financial watchdog, the number is now down to 15, the minister said. The FATF has a planned review for the UAE scheduled in May.
Asked about when the UAE might be taken off the FATF’s “gray list,”’ Al Marri referred the question to the watchdog itself. The UAE’s government can’t “expedite” the process, he said.
The minister also reiterated that while a corporate tax is going into force later this year, an income levy “is not on the table at the moment.” More details regarding the 9% corporate tax will be coming out over the next couple of months, including which entities would be exempt, he said.
