Godongwana criticises opposition for playing ‘petty politics’ over SA greylisting

Finance Minister Enoch Godongwana has criticised opposition parties for playing “petty politics” instead of helping to get South Africa off the greylist.

The Financial Action Task Force (FATF) in February greylisted South Africa for not having done enough to combat money laundering and the financing of terrorism.

The move meant that South Africa would be under close surveillance by the global money laundering and terrorist financing watchdog, and international banks will place the country in a higher risk category.

‘Politicisation of the problem’

Responding to a parliamentary debate in the National Assembly on Tuesday, Godongwana took a swipe at the opposition for not coming with solutions to address the matter.

“It is an issue that is very attractive for the opposition parties. It is easy to portray [the greylisting] as some kind of international criticism of South Africa… what I had hope for was that having criticised us for our failures, our colleagues in the opposition benches would probably offer us some solutions.

“What is the solution we are being granted? Remove the ANC… that is the solution which I have seen coming at us,” he said.

The minister said government understood that the greylisting was a serious matter.

“The FATF process is a rigorous one and we don’t think the decision to greylist South Africa was taken for frivolous reasons,” he said.

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“The fact of the matter is that South Africa does have challenges of crime and corruption – and that these generate a lot of proceeds of crime.”

He also said South Africa has not yet felt any significant negative impact due to the greylisting.

“Have we seen capital outflows in this economy which we can attribute to greylisting? My answer is no. [For] example, in April we have had positive inflows more than any period between 2017 and now. Those are facts. You can go to the central bank to get to those figures.

“We have not seen any negative reaction by corresponding financial institutions to our institutions. So what we largely have is a politicisation of the problem, rather than a focus on the resolution of the problem.”

Major economic consequences

Godongwana, however, acknowledged the impact greylisting would have on the country’s economic prosperity in the future.

“Even though we don’t think that greylisting has itself posed any significant problem yet, we have to recognise the reasons we were greylisted do have major economic consequences. If we don’t deal with crime and corruption more effectively then we will struggle to solve our economic challenges.”

The minister insisted that government was aiming to get South Africa off the list in 2024.

“Having legal tools available to identify and combat money-laundering is not by itself enough. We also need to put up our game with respect to enforcing the laws, identifying wrongdoers and prosecuting them successfully.”

READ MORE: South Africa’s greylisting: What it means

He further cited state capture as one of the reasons for weakening the country’s law enforcement institutions.

“We are making progress in addressing these weaknesses, but this is not the work of the day even with leadership that are not tainted by state corruption, it takes time to build the skills and capacity.”

Godongwana confirmed that government would meet with the FATF every three months to assess progress.

“Starting next week, we are going to have a meeting with them in Mauritius.”