EU flags Algeria as high-risk over terror financing, Polisario ties questioned

Friday 13 June 2025 - 12:20

By: Dakir Madiha

EU flags Algeria as high-risk over terror financing, Polisario ties questioned

The European Commission has officially added Algeria to its updated list of high-risk jurisdictions for money laundering and terrorist financing, citing the country’s strategic deficiencies in combating these issues. The decision, announced on June 10, follows an evaluation by the Financial Action Task Force (FATF), which flagged Algeria’s non-compliance with international standards last October.

This move is being interpreted as a potential shift in the European Union’s stance regarding Algeria's role in supporting the Polisario Front, a separatist group at the center of the Sahara conflict. Many international observers and politicians have called for the designation of the Polisario Front as a terrorist organization, further complicating Algeria’s diplomatic standing.

Growing scrutiny of Algeria’s role

The European Commission’s decision reflects increasing global scrutiny of Algeria’s financial practices and its longstanding support for the Polisario Front. The Algerian regime has funneled billions of dollars into the group, which it uses as a geopolitical tool to challenge Morocco’s territorial integrity over its southern provinces. Reports have also accused Polisario leaders of embezzling humanitarian aid meant for Sahrawis living under dire conditions in the Tindouf camps.

Algeria’s addition to the high-risk list coincides with a broader wave of international support for Morocco’s autonomy plan in Sahara. Backed by more than 113 countries, the initiative is widely recognized as the most credible framework for resolving the decades-long territorial dispute.

Setbacks for the Polisario agenda

The EU’s decision comes on the heels of a series of diplomatic blows for the Polisario Front and its main sponsor, Algeria. In May, the EU reiterated its refusal to recognize the so-called "SADR" (Sahrawi Arab Democratic Republic), the self-proclaimed state established by the Polisario. An EU spokesperson reaffirmed that neither the bloc nor any of its member states recognize the entity, dismissing its participation in a recent EU-African Union ministerial meeting as inconsequential.

This marks yet another setback for Algeria’s separatist agenda, as the international community increasingly aligns with Morocco’s sovereignty claims. Algeria’s diplomatic isolation is further compounded by growing tensions with regional and global actors, leaving the regime under heightened pressure.

Implications for Algeria

The inclusion of Algeria on the EU’s high-risk list not only underscores the country’s financial vulnerabilities but also signals mounting frustration with its geopolitical maneuvers. Critics argue that Algeria’s support for the Polisario Front, combined with allegations of corruption and aid mismanagement, undermines its credibility on the international stage.

As Algeria navigates this sensitive period, it faces escalating diplomatic isolation, compounded by its failure to address global concerns over money laundering and terrorism financing. The move by the EU is widely seen as a wake-up call for the Algerian regime, urging it to reform its financial systems and reconsider its foreign policy priorities.