Pan-African payment system to save Africa $5 billion annually: AfCFTA
The AfCFTA Secretariat says the commercial roll-out of the Pan-African Payment & Settlement System (PAPSS) will save Africa up to $5 billion annually.
The Secretary-General of AfCFTA, Wamkele Mene, made the remarks on Thursday at the commercial launch of the PAPSS in Accra, Ghana.
PAPSS is a cross-border, financial market infrastructure enabling payment transactions across Africa and ensures instant or near-instant transfer of funds between originators in Africa.
“The great liberation struggle heroes of our continent over 60 years ago had a vision of an integrated market in Africa are rejoicing today because the dream of an integrated Africa is becoming a reality in our lifetime,” said Mr Mene. “How fitting it is, therefore, that the commercial launch of the PAPSS is taking place here in Ghana, a country that has always been at the intellectual and philosophical vanguard of Pan-Africanism.”
He added that the project was a pioneering effort at achieving a pan-African payments and settlements system which will enable Africa to reduce reliance on third currencies, and more importantly, it has the potential to significantly boost intra-Africa trade.
“The commercial roll-out of the PAPSS is timely and set to boost intra-Africa trade significantly by making cross-border payments less reliant on third currencies,” explained the AfCFTA secretary-general. “It is set to save the continent up to $5 billion annually, which is the amount currency convertibility costs Africa.’’
Mr Mene mentioned that Africa had, in the last two years, borne the effects of the challenges of the COVID-19 pandemic, which led to border closures, restrictions and logistical difficulties that had disrupted trade and economies.
“In the midst of this, our heads of state took the bold decision to commence trading under the very difficult conditions that were caused by the COVID-19. Since the commencement of trading under the AfCFTA on Jan 1, 2021, significant improvements were recorded in other key aspects of the implementation of the agreement,” he said.
Mr Mene added that they included an increase in the number of AfCFTA state parties from 35 (64 per cent) in December 2020 to 39 (73 per cent) at the end of 2021.
“Improvement in the agreement on the AfCFTA rules of origin from 81.8 per cent to 88.6 per cent. Activation and operationalisation of the Dispute Settlement Body (DSB), a key pillar in the successful implementation of the agreement, in April,” he disclosed.
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