Panama may exit risk list designation may soon come to an end, following the European Commission’s recommendation to exclude Panama from the European Union’s high-risk third-country list. This recommendation is the result of substantial financial and legal reforms made by Panama to strengthen its anti-money laundering (AML) and counter-terrorism financing (CTF) systems.
The European Commission acknowledged Panama’s improved regulatory environment, enhanced transparency, and stricter enforcement mechanisms. These reforms align with international standards set by the Financial Action Task Force (FATF), marking a major milestone in Panama’s ongoing commitment to financial integrity.
In the middle phase of reform, Panama introduced tougher laws against illicit financial flows, improved its company registry system, and enhanced supervision of financial institutions. These efforts played a critical role in convincing EU authorities of the country’s compliance progress.
The removal from the Panama exits risk list is expected to yield significant economic benefits. It may reduce compliance burdens on European financial institutions dealing with Panamanian entities, promote international investment, and boost confidence in Panama’s financial system. Officials from Panama’s Ministry of Economy and Finance emphasized that the country remains committed to transparency and continued monitoring.
If the recommendation is approved by the Council of the EU, it will officially take effect through an amendment to the EU regulation. This would mark a turning point for Panama’s global financial reputation.
Ending its classification on the Panama risk list will not only improve its diplomatic relations but also attract global investors looking for stable and compliant markets.