DUBAI/PARIS: The United Arab Emirates, home to the financial hub of Dubai, has been dropped from a global watchdog’s list of countries at risk of illicit money flows, a win for the nation that could bolster its international standing.
The Financial Action Task Force (FATF), a body that groups countries from the United States to China to tackle financial crime, on Friday dropped the UAE from its ‘grey list’ of around two-dozen nations considered risky.
The Gulf country, a magnet for millionaires, bankers and hedge funds, was placed under closer scrutiny in 2022, when the FATF highlighted the risk of money laundering and terrorist financing involving banks, precious metals and stones as well as property.
The delisting is a coup for the one-time regional pearl and fish trading hub which is now one of the world’s wealthiest nations after the discovery of oil in Abu Dhabi in the late 1950s.
It had made getting off the list a priority, bolstering its anti-money-laundering efforts in a drive spearheaded by the minister of foreign affairs and brother of President Mohamed bin Zayed Al Nahyan.
John Kartonchik, a director at UAE think tank Re/think, said the move could boost confidence in the country and attract more money from overseas.
“Investors ... may feel more secure,” he said.
Banks would also be able to cut the cost of dealing with wealthy clients in the country, said a senior banker, who asked not to be named.
Despite being grey-listed, the UAE continued to attract the globe’s wealthy and it is an increasingly popular destination for cryptocurrency firms and Russians in the wake of war with Ukraine.
Dubai’s luxury property market trailed only New York, Los Angeles and London in 2022, according to property consultant Knight Frank, while the UAE last year overtook Belgium to become the world’s trading hub for rough diamonds.
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