China’s money laundering crackdown reflects ‘severe’ risks facing the financial system
- Analysts say China has a long way to go to combat illicit financial flows after Beijing launched a three-year action plan to prevent money laundering
- The crackdown comes as the world’s second largest economy faces renewed threats of capital outflows from US interest rate hikes
China has a long way to go to clamp down on money laundering, despite renewed efforts to root out illicit financial flows that could endanger the country’s financial system.
Beijing on Wednesday launched a three-year action plan to combat underground money flows that are most often seen in cases of corruption, tax evasion and organised crime.
The campaign is being led by the People’s Bank of China (PBOC) and the Ministry of Public Security, and has been joined by agencies including the anti-corruption commission, the Supreme Court, tax and customs authorities.
Officials said the “current situation remains severe”.
“We must resolutely contain the spread of such crimes, and try to solve them from the root and with comprehensive measures,” said a joint statement.