South Africa’s Grey Listing & Exchange Control: Insights from the International Investing Symposium

It was an honour to present at the International Investing Symposium last week, where I discussed two topics shaping South Africa’s financial and investment landscape: our FATF grey listing and the evolution of exchange controls.

South Africa’s Grey Listing Journey

In February 2023, South Africa was placed on the FATF grey list, requiring enhanced international monitoring and action on 22 key items, including, inter alia:

• Beneficial ownership transparency.
• Detecting illicit financial flows.
• Improving international cooperation.

By June 2025, South Africa had substantially completed these reforms, leading to an FATF-approved on-site visit in July 2025. The FATF decision on removal from the grey list is expected in October 2025.

Grey listing has real economic consequences: increased compliance obligations, higher transaction costs, reduced foreign direct investment (FDI), and tougher access to foreign financing. But it also provides a platform for reform, building stronger financial intelligence, supervisory systems, and ultimately, trust.

Looking Ahead: FATF Mutual Evaluation 2027

Our next FATF Mutual Evaluation is scheduled for April 2027, under a revised, more demanding methodology that will not only assess the laws on the books, but also how effectively they are implemented. The challenge is not just to exit the grey list in 2025, but to ensure South Africa does not return to it in 2027.

Exchange Control: From Restriction to Flow Management

In 2020, the Government introduced the Capital Flow Management (CFM) Framework, modernising South Africa’s exchange control regime in line with IMF and OECD guidelines. While the CFM Framework has not yet been implemented, some major reforms have taken place since 2020:

• Phasing out formal emigration via SARB.
• Relaxing rules on loop structures and trust distributions.
• Enabling transfers of royalties and fees to related parties without prior SARB approval.
• Increased transparency and engagement from the SARB’s Financial Surveillance Department.

Back on the International Stage

With South Africa’s AML, terrorist financing, and proliferation financing reforms taking hold and a modernised exchange control framework underway – investors can be confident that we are firmly back on the international stage and open for business.