Launch of PAPSS in Accra, Ghana, one year after commencement of AfCFTA-Wither ECO currency
By Chukwuemeka Eze,
The project for a common currency for trans-border transactions seem to have been jettisoned with the launch of the Pan-African Payment and Settlement System (PAPSS) in Ghana on Thursday, 13th January, 2022 to aid the operationalisation of the African Continental Free Trade Agreement (AFCFTA).
Which is better between ECO and PAPSS? The commentary below might be helpful.
ECO is better but it will take a long time to implement. It involves a lot of bureaucracy and it is Government-driven. It will require each country shedding part of its economic sovereignty. Besides, a colonial master, France, who controls the French-speaking countries in their economic block known as UEMOA, is not in support of the proposed change. The capital needed to complete the process is huge and most of the countries are not forthcoming with their contributions. Waiting for ECO will disrupt the payment system needed for the successful implementation of AfCFTA.
On the other hand, Pan-African Payment and Settlement System will enable a payment made in the currency of the payer’s country to be received in the currency of the receiver’s country. It is private-sector driven and technogically enabled. It was launched in Accra, Ghana, on Thursday, 13th January, 2021, about one year after the commencement of AFCFTA.
Chukwuemeka Eze is the Lead Legal Adviser , Chartered Institute of Taxation of Nigeria (CITN)
