Potential risks of Money Laundering and Terrorist Financing in SADC’s Informal Cross-Border Trade – A South African perspective
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Date
2024
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University of the Western Cape
Abstract
The Southern African Development Community (SADC) is known for its emerging economies that are largely dominated by a significant number of Informal Cross-Border Trade (ICTB) activities. 1 These activities play a pivotal role in regional trade and international mobility, and they represent an important aspect of the economy. The SADC is an inter-governmental organization headquartered in Gaborone, Botswana, comprising 16 Member States.2 These Member States are Angola, Botswana, Comoros, the Democratic Republic of Congo, Eswatini, Lesotho, Madagascar, Malawi, Mauritius, Mozambique, Namibia, Seychelles, South Africa, Tanzania, Zambia, and Zimbabwe.3 The objectives of the SADC are to achieve economic development, peace, and security, as well as to promote growth, alleviate poverty, and enhance the living standards and quality of life of the people of Southern Africa.4 Additionally, the SADC aims to support the socially disadvantaged through regional integration.5 In 2011 the SADC recognised money laundering and terrorist financing as a priority crime and promulgated Annex 12 (Anti-Money Laundering (AML)) to its Protocol on Finance and Investment (hereafter referred to as Annex 12). The SADC Annex 12’s objectives are to facilitate the joining of anti-money laundering and combating of financing of terrorism policies, laws, and regulatory practices of its Member States, within the framework of the Financial Action Task Force (FATF) Recommendations.6 Annex 12’s aim is to further support an effective and proportional action against money laundering and the financing of terrorism in the SADC region.
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Keywords
Money Laundering, Trade Based Money Laundering, Informal Cross-Border Trade, Countering Financing Of Terrorism, SADC