EU states block plan to add Saudi Arabia to money laundering blacklist

Pedro Gonçalves
clock
EU states block plan to add Saudi Arabia to money laundering blacklist

The 28 member states of the European Union unanimously supported a decision on Thursday to reject a proposal from the EU executive to add Saudi Arabia to a blacklist of countries suspected of being lax on terrorist financing and money laundering.

The ill-fated plan infuriated Saudi Arabia as well as the United States and exasperated European capitals. In a rebuke for the EU Commission, the member states said that the proposal "was not established in a transparent and resilient process."

The decision comes after pressure from Riyadh and other listed jurisdictions not to be blacklisted. A letter written by King Salman bin Abdulaziz warned that inclusion would affect the kingdom's reputation and "create difficulties" in trade and investment flows between Saudi and Europe, according to Reuters.

I'm disappointed, but I hope I don't look like somebody who is giving up"

Britain and France are the No. 2 and No. 3 arms suppliers to Saudi Arabia, according to the Stockholm International Peace Research Institute. The EU, meanwhile, is a big user of Saudi oil and an eager recipient of investment from Riyadh's $230bn sovereign fund.

The decision will force the European Commission to prepare a new list.

"I'm disappointed, but I hope I don't look like somebody who is giving up," the EU commissioner in charge of the listing, Vera Jourova, said.

In a hearing in the EU Parliament, Jourova this week said she was subjected to heavy lobbying by some countries affected by the decision, citing Saudi Arabia, the United States and Panama.

She raised doubts about the motivations of EU states for blocking the list, and said she will consult them again before a new list could be prepared.

The list included nations like Saudi Arabia, North Korea and Nigeria, and four US overseas territories, which drew criticism from the US government. Inclusion on the EU list does not trigger sanctions, but it does oblige European banks to apply tighter controls on transactions with customers and institutions in those countries.