(Adds comments from Finance Minister, background details)

By Anthony Esposito and Stefanie Eschenbacher

ACAPULCO, Mexico, March 8 (Reuters) - Mexico, burdened by warring drug cartels that launder untold billions of dollars every year, needs to improve the rule of law in order to better combat financial crimes, Finance Minister Jose Antonio Gonzalez Anaya said in an interview on Thursday.

"We have to improve the rule of law so that these things can be prosecuted more efficiently," Gonzalez Anaya told Reuters on the sidelines of the Mexican banking association's annual convention in the seaside resort of Acapulco.

The Financial Action Task Force (FATF), an international organization based in Paris that sets global standards for fighting illicit finance, criticized Mexico in a January report.

The report said money laundering was not being investigated and prosecuted in a proactive and systematic fashion, and said the number of prosecutions and convictions is very low.

Gonzalez Anaya said Mexico has the political will to tackle the issue, pointing to the arrest of powerful drug kingpins like Joaquin "El Chapo" Guzman.

"The fact that we have been making progress and we have captured many of the biggest criminals shows you that the conviction to fight crime is there," said Gonzalez Anaya, a Harvard-educated former World Bank official.

Guzman is sitting in a U.S. jail awaiting a Sept. 5 trial date on drug trafficking and conspiracy charges, after Mexican authorities recaptured him and extradited him.

Still, according to the government's own estimates, Mexico has made little progress on seizing illicit cash.

It seized just $32.5 million in 2016, or less than 0.1 percent of the $58.5 billion of illicit revenues the government estimates is generated by organized crime annually.

"We need to keep working, this is an ongoing process that we need to work on because it is evolving and it is evolving in size and in nature," Gonzalez Anaya said. "We have been adopting new standards of money laundering in Mexico."

Mexico is the top supplier of illegal drugs to the United States and both countries' authorities have been criticized by civil society groups for leaving drug gang finances largely intact.

"Mexican financial authorities and U.S. financial authorities, we have a good and fluent relationship in all of these issues," said Gonzalez Anaya.

Graft scandals have for decades dogged the political elite in Mexico, which ranked 128th out of 137 nations for ethics and corruption in the World Economic Forum's 2017-2018 Global Competitiveness Index. (Reporting by Anthony Esposito and Stefanie Eschenbacher Editing by Julia Love and Leslie Adler)