The Pan-African Payment & Settlement System (PAPSS) is expected to boost intra-African trade and save the continent $5 billion annually.
This was disclosed by the Secretary-General of AfCFTA, H.E Wamkele Mene on Thursday at the commercial launch of the PAPSS in Accra, Ghana, as monitored by Nairametrics.
The PAPSS system is a cross border finance market payment structure to facilitate trade within Africa which the CBN will also take part in.
What the AfCFTA boss said
Speaking at the event, Mene commended the initiative stating that the dream of an integrated market in Africa was coming to reality.
He said, “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.
“This project is 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.
Mene said that PAPSS would boost intra-Africa trade as cross-border payments will become less reliant on third currencies, earning the continent an average of $5 billion annually.
“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.
“It is set to save the continent up to US$5 billion annually, which is the amount currency convertibility costs Africa,” he said.
He also stated that Heads of States took the bold decision to commence trading under the very difficult conditions that were caused by the COVID-19 and that since the commencement of trading under the AfCFTA significant improvements have been recorded in key aspects of the implementation of the agreement.
“The improvement include an increase in the number of AfCFTA State parties from 35 (64%) in December 2020 to 39 (73%) at the end of 2021; Improvement in the agreement on the AfCFTA rules of origin from 81.8% to 88.6% and Activation and operationalisation of the Dispute Settlement Body (DSB), a key pillar in the successful implementation of the agreement, in April,” Mene said.
He also stated that with the launch of the PAPPS, it would be a critical tool for boosting intra-Africa trade, as the implementation of the AfCFTA is well-positioned to benefit SMEs, young entrepreneurs and those trading across borders in Africa shall remain ineligible.
