PAPSS Aims to Liberate Africa from US Dollar Dominance

African countries are working to establish a new financial system that would allow transactions in local currencies.

The Pan-African Payment and Settlement System (PAPSS) was launched in Ghana in 2022 by the African Union and the African Export-Import Bank (Afreximbank).

PAPSS enables two African countries to trade directly in their local currencies, bypassing outside intermediary banks and major foreign currencies.

The system has rapidly expanded across the continent, with 30 African countries out of a total of 41 central banks now part of it.

Economist Mohamed Anis explained that traditional cross-border trading systems route transactions through intermediary banks using third-party currencies like the dollar, adding time and costs to imports.

PAPSS reduces the cost of transfers within the continent by up to 95%, with transaction execution time shortened from several days to a maximum of 120 seconds, averaging only 7 seconds per operation.