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Turkey has officially been removed from the Financial Action Task Force (FATF)’s “grey list”, marking a significant step towards economic recovery for the country. The decision follows a meeting with Turkish authorities where the FATF determined that Turkey had taken satisfactory steps to combat money laundering and terrorism financing. This announcement is expected to boost investor and consumer confidence in Turkey, ultimately helping to strengthen the country’s financial systems and lift it out of its ongoing economic decline.

Turkey’s economic crisis has been exacerbated by soaring inflation, exacerbated by unconventional monetary policies supported by President Recep Tayyip Erdogan. The country’s housing market also experienced a rapid increase, leaving many unable to afford rents and mortgages. However, with Turkey now off the grey list, foreign businesses, investors, and global banks are likely to return, leading to a potential increase in output, exports, and consumption.

The grey list, also known as “Jurisdictions under increased monitoring”, includes countries working to address gaps in their anti-money laundering and terrorism financing laws. Failure to meet agreed-upon goals can result in a country being moved to the FATF’s black list, which contains nations with significant strategic deficiencies in financial crime prevention. While Turkey has made progress in addressing these issues, continued efforts are essential to prevent a return to the grey list or worse. The FATF’s decision to remove Turkey from the grey list is a positive development that bodes well for the country’s economic future.

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