Ethiopia is now taking a leading role in combating illicit financial activity in Africa, taking a visible lead in regional and institutional reforms against money laundering (AML) in 2025. The hosting of the 50th Task Force of Senior Officials Meeting of the Eastern and Southern Africa Anti-Money Laundering Group (ESAAMLG) in Addis Ababa between August 22 and 30 supported issues of African hostility. Ethiopia has been given an eminent role to play in developing collective responses to financial crime and terrorism financing due to the ESAAMLG which consists of 21 member states.
Ethiopia has under the leadership of Prime Minister Abiy Ahmed, prioritized the enforcement of AML and counter-terrorist financing (CFT) as a national priority. A whole-of-government approach is the creation of an integrated National Anti-Money Laundering and Counter-Terrorism Financing Financing Committee, a 23-state body. It is an improved structure that enhances strategic oversight, interagency cooperation and front-line enforcement capabilities to handle even more advanced threats.
Strengthening institutions and legal frameworks
One of the most important aspects of Ethiopia’s leadership strategy is the strengthening of its Financial Intelligence Unit (FIU) that coordinates the analysis and referrals of suspicious transactions. The government has as well broadened AML training to prosecutors, judges, the customs officials, and central bank supervisors to ensure that their practices are in line with the international standards. The purpose of these institutional reforms is to transform financial oversight and enforcement into being proactive and intelligence-driven.
Modernizing legal standards
Legal reform has advanced in parallel. In June 2025, Ethiopia enacted revised AML legislation granting broader investigative powers to financial crime units, including controlled operations and data access provisions. While welcomed for improving detection and prosecution, elements of the law—such as expanded undercover operations with legal immunity—have sparked domestic and international debate over rights protections and judicial oversight. Ethiopia’s challenge now is to harmonize effective law enforcement with constitutional guarantees and public accountability.
Regional coordination as a force multiplier
Ethiopia’s role within ESAAMLG has been instrumental in advancing regional information-sharing mechanisms. Executive Secretary Fikile P. Zitha reiterated in August that effective enforcement depends on inter-state cooperation, as criminal finance networks are transnational. Ethiopia has played a leading role in facilitating cross-border coordination, joint investigations, and shared typologies of risk—replacing the fragmented narratives that previously dominated continental discourse on money laundering.
Building financial governance cohesion across member states
The Addis Ababa meeting produced commitments to synchronized legislative standards, improved regional analytics, and harmonized risk assessments. Ethiopia’s leadership illustrates how proactive engagement by one country can catalyze broader alignment in financial governance across a complex and diverse region. This coordination also positions African AML institutions to counter negative perceptions linking African financial systems with weak controls and high risk.
Challenges facing Ethiopia and Africa in AML implementation
The challenge of ensuring rights-respecting AML policies persists. Certain new legal provisions of Ethiopia are well intended but there is a risk that, without proper monitoring, they can be used to undermine due process. Civil society players and legal practitioners have expressed concern over the risk of misuse of undercover powers and spy gadgets and demanded tougher controls and judicial checks and balances to keep such powers in check.
Institutional capacity limitations
Nevertheless, current developments have left most African enforcement agencies, Ethiopia inclusive, limited in the number of personnel, forensic tools, and analytics. Such restrictions have impacts on the detection and prosecution and, therefore, some financial crimes are not challenged. Also, federal/regional coordination within Ethiopia is still erratic and needs further decentralization of training and technical assistance to be more effective.
Informal economies and data gaps
The informal economies of Africa still pose blind spots to financial surveillance. In Ethiopia, where a large portion of the economic life is unbanked, regulators are unable to trace the illicit funds without seeing them in full. The traditional compliance systems might be insufficient to tackle such dynamics, and more innovation in data collection, fintech regulation, and collaboration with the informal sector actors to create context-specific solutions are needed.
Cryptocurrencies and digital assets
The rapid expansion of digital finance on the continent has brought with it new vulnerabilities, such as mobile money, crypto wallets and decentralized finance. In Ethiopia, new digital platforms do not have sufficient coverage by the existing AML framework. With the Financial Action Task Force (FATF) urging countries to stick with Recommendation 15 in regard to virtual assets, Ethiopia will need to step up its policy changes and capacity to keep up with digital transactions without dampening financial inclusion.
Global recognition and way forward
By 2025, the leadership of the anti-money laundering in Ethiopia is not only known to Africa but also by the international stakeholders who consider financial governance to be very important in promoting sustainable development. Revenue collection agencies like the OECD, World Bank and the Egmont Group have increased technical assistance to the enforcement agencies of Ethiopia. The programs also cover cross-border legal assistance, financial investigations, and the system of enhanced due diligence.
The partnership framework that has been put in place by Ethiopia, combining local changes with regional integration and international alliances, is an anticipatory design. Nonetheless, this momentum will have to be sustained through on-going training, technology, and social confidence. The capacity of Ethiopia to identify the anti-money laundering objectives with both development and anti-corruption approaches will eventually determine the sustainability of its leadership on the topic.
This individual has spoken on the subject, highlighting the critical position of Ethiopia in defining the future financial integrity landscape in Africa and calling for open and collaborative strategy to create lasting impact:
Their remarks underscore the importance of trust-based engagement, policy clarity, and public-private partnerships in building credible and effective AML systems in the region.
The leadership approach that Ethiopia adopts in its fight against money laundering in Africa is symptomatic of a wider continental trend of a more strategic financial integrity. The orientation of the country towards aligning the enforcement, modernizing its legal instruments, and filling the institutional gaps makes it a prototype of the new economies facing transnational crime. The way Ethiopia balances its twin requirements of security and protection of rights will determine its domestic legitimacy as well as its role in carving out the future of Africa in terms of financial capability.