Much of the media’s focus after BLSA issued its report on grey listing last week has been on the 85% chance of SA being placed on the list by the Financial Action Task Force (FATF), the international watchdog organisation for money laundering and the financing of terrorism. Rightly so, but more focus needs to be paid to the 15% chance of us avoiding it altogether.

That’s a fighting chance and with our economy teetering and fears of a global recession rising, we need to do everything we can to prevent it from weakening further.

The report, researched by Intellidex, concludes that the economic impact of being grey listed depends on how we react to improving our systems and processes to combat money laundering and the financing of terrorism. The FATF published a report a year ago highlighting SA’s deficiencies and effectively gave us until this October to get our house in order.

If we are perceived to be slow and unwilling to comply, Intellidex estimates it could reduce GDP by 3% in the worst case scenario. Should we show that we are seriously addressing the problems the impact could be less than 1%. This is because global counterparts will be more willing to maintain their relationships with South African clients and we’re likely to be removed from the grey list earlier.

And we’ve already made much progress, as the report outlines.

A major area of SA’s weakness highlighted in the FATF report was in the lack of prosecutions following the state capture era and that’s because our capacity to combat commercial crimes was decimated by the perpetrators. But the National Prosecuting Authority (NPA) has been rebuilding resources and capacity and while it is still short of both, it has made good progress recently, filing 29 prosecutions related to state capture and securing freezing orders on over R5.5bn. Intellidex notes also that there have been “impressive joint programmes to improve investigation of corruption” between the NPA and numerous other crime-fighting units including the Directorate for Priority Crime Investigation and the Financial Intelligence Centre, as well as with the SA Revenue Service.

But the report also lists three main areas where we’re struggling and this is where we need to focus.

Two of them shouldn’t be too problematic. We need an efficient system of gathering and dissemination data regarding beneficial owners of trusts and companies, and the Financial Intelligence Centre (FIC) needs to take on additional supervision responsibilities for the money laundering and terrorist financing oversight of non-financial institutions, including real estate agents, attorney firms, Krugerrand dealers and others. While the legislation to give effect to this is in progress, the additional budgets and resourcing still need to be developed.

The third area is possibly more problematic. The Directorate for Priority Crime Investigation, or Hawks, have made minimal progress in building the capacity to investigate money laundering and terrorist financing, as well as other commercial crime. It has been slow to take on more staff, especially financial investigators and forensic accountants, the report states.

With the private sector providing no-strings attached resources where required to support legal and law-enforcement processes, BLSA believes these institutions can be brought up to the required standards.

The report also recommends that the Presidency set up an internal task team to lead the government response to grey listing, working with the Inter-Departmental Committee assembled by National Treasury. The task team must be resourced with expertise to facilitate the change management and capacitation that must happen in key institutions such as the Hawks and the FIC.

“It must be able to focus on blockages and capacity constraints in partnership with the Police Ministry, Justice Ministry, Home Affairs, National Treasury, SA Revenue Services and others.”

Should government set up such a unit immediately, it will be one more important step that may yet sway the FATF plenary when it sits in February to defer placing us on the grey list. Whatever the permutations, the message to government and all stakeholders remains the same: SA needs to fight hard and move ahead with maximum speed in implementing FATF’s recommendations – we’ll either be able to avoid grey listing entirely, or minimise the period spent on the list. That’s a victory for our economy worth fighting for.

• Mavuso (@BusiMavuso2) is CEO of Business Leadership SA. This article first appeared in Business Day.