Regional leaders seek faster adoption of PAPSS to cut cross-border trade costs

Regional leaders have called for the accelerated adoption of the Pan-African Payment and Settlement System (PAPSS) to reduce cross-border transaction costs, improve local currency settlements and unlock the full potential of the African Continental Free Trade Area (AfCFTA) across West Africa.

The call was made at Citi’s high-level Business Symposium in Abuja, themed “Broadening Trade Flows within West Africa’s Main Corridors under the African Continental Free Trade Area (AfCFTA),” where policymakers, regulators and business leaders from Nigeria, Côte d’Ivoire and Ghana identified payment reforms as a key priority for boosting intra-African trade and regional economic integration.

Participants said despite the opportunities presented by AfCFTA, businesses continue to face major obstacles, including customs bureaucracy, non-tariff barriers, fragmented standards, limited currency convertibility, inadequate infrastructure and a persistent trade finance gap, all of which increase the cost of doing business across borders.

To address these challenges, stakeholders recommended wider adoption of PAPSS to facilitate local currency settlements, alongside digitised single-window customs clearance, harmonised standards and increased investment in transport and logistics infrastructure. They said these reforms would reduce dependence on foreign currencies, lower transaction costs and improve the efficiency of regional trade.

Lamido Yuguda, deputy governor, Financial System Stability at the Central Bank of Nigeria (CBN), said strengthening cross-border payment systems and improving financial intermediation are essential for AfCFTA’s success. “As intra-African trade scales under AfCFTA, the efficiency of financial intermediation will play a pivotal role. Strengthening cross-border payment systems, improving FX market functionality, and deepening access to trade finance are essential to reducing transaction costs and enabling smoother trade flows,” he said.

Yuguda added that central banks must serve as enablers of regional integration by building efficient payment and trade systems while expanding access to finance for businesses operating across African borders.

Nneka Enwereji, managing director and chief executive officer of Citibank Nigeria Limited, said Nigeria occupies a strategic position in the success of AfCFTA, noting that Citi remains committed to supporting clients with practical financial solutions that facilitate the movement of goods, capital and payments across the continent. “The AfCFTA aims to facilitate the efficient cross-border movement of goods, capital, and payments. Citi is committed to providing practical financial solutions that empower our clients to expand regionally and enhance their competitiveness in new markets,” she said.

As trade within Africa continues to gain momentum, participants identified West Africa’s major trade corridors as critical to achieving the objectives of the continental free trade agreement. Citi said it remains committed to supporting that transformation through its regional network, trade finance capabilities and cross-border banking expertise.

Kalilou Traoré, Côte d’Ivoire’s ambassador to Nigeria, said although AfCFTA has made significant progress, major challenges such as non-tariff barriers, fragmented standards and inadequate infrastructure continue to limit trade across the continent.

According to him, the success of the agreement will depend on stronger collaboration in financing trade, supporting industrialisation and developing economic zones that can stimulate regional production.

Similarly, Gladys Mansa Yawa Feddy Akyea, Ghana’s deputy high commissioner to Nigeria, said AfCFTA’s success should ultimately be measured by its ability to facilitate trade, improve connectivity, mobilise finance and eliminate practical barriers confronting businesses.

She called for stronger partnerships among African countries to build regional value chains capable of transforming the continent into a globally competitive integrated market.

John Owan Enoh, minister of state for Industry, said AfCFTA presents Nigeria with an opportunity to accelerate industrial growth and expand market access for local businesses through stronger regional value chains.

“Our focus is on strengthening the competitiveness of Nigerian industries, improving the ease of doing business, and implementing policies that support export growth and regional value chains. Through sustained collaboration with the private sector, we are positioning Nigeria to play a leading role as a net exporter of manufactured goods and a driver of intra-African trade and economic integration,” Enoh said.

He urged African countries to shift from exporting raw materials to producing value-added goods, describing industrial policy as the missing link needed to unlock the full benefits of regional trade.