The African Export-Import Bank (Afreximbank) has instituted a $1-billion adjustment facility to support the implementation of the Agreement for the African Continental Free Trade Area (AfCFTA).
Afreximbank president Professor Benedict Oramah addressed delegates at the twelfth Extraordinary Summit of African Union (AU) Heads of State, at the weekend, announcing a series of initiatives to support the implementation of the AfCFTA.
The adjustment facility will enable countries to adjust in an orderly manner to sudden significant tariff revenue losses as a result of the implementation of the agreement.
“This facility will help countries accelerate the ratification of the AfCFTA,” said Oramah.
As part of its support for the implementation of the AfCFTA, the bank previously provided support to aid the work being done by the African Regional Standards Organisation and the AU in implementing the agreement.
Oramah also informed the summit delegates of the launch of the Pan-African Payment and Settlement System (PAPSS), the first continent-wide digital payment system focused on facilitating payments for goods and services in intra-African trade in African currencies.
“It is a platform that will domesticate intra-regional payments, save the continent more than $5-billion in payment transaction costs a year, formalise a significant proportion of the estimated $50-billion of informal intra-African trade and, above all, contribute to boosting intra-African trade.”
Oramah stated that, by making it possible for Africans to pay for intra-regional trade in their local currencies, the digital platform will deal a “blow” to the underdevelopment of Africa that is caused by defragmentation of its economies.
“Making cross-border payments easier, cheaper and safer is an obvious critical step in creating an Africa we want,” he concluded.