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AfCFTA to Discuss the Launch a Payment System for Continental Free Trade Area in December

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AfCFTA Continental Payment System to power trade remittance across Africa.

The African Union has announced that its Specialised Committee on Finance, Monetary Affairs, Economic Planning and Integration will discuss the launch of a payment system for the African Continental Free Trade Area (AfCFTA) from the 1st to the 3rd of December.

The African Union disclosed this on Tuesday evening. The two days meeting will be held before the supposed deadline on the ratification of the agreement from member states.

What you need to know

The African Continental Free Trade Area (AfCFTA) is projected as one of the biggest free-trade agreements in the world. The market is predicted to have a  potential combined gross domestic product of $2.5 trillion with 1.2 billion population.

The Federal Government previously announced that it has ratified Nigeria’s membership to the African Continental Free Trade Area (AfCFTA) ahead of the December 5, 2020 deadline. 

This preparation comes in time prior to the official planned launch in Jan, 2021. This new free trade agreement according to the Government of Nigeria will help reduce the strength of the falling naira.

“The agreement would reduce the erosion of the naira, which has suffered nearly 90% devaluation since 2016, through exports of Nigerian-made goods and services, and give exposure of the naira”, said Mr. Francis Anatogu, Secretary, National Action Committee on AfCFTA.

The African Union will build the Continental Payment System (CPS) that will facilitate payment for the AfCFTA countries. The theme of the meeting will be “Securing Africa’s Taxing Rights, Stemming Illicit Financial Flows and developing payment system for AfCFTA”. 

What will be discussed

They will also discuss how to prevent illegal capital flight and digital tax / tax challenges surrounding the agreement due to the fast growing African Digital Economy. The economy of Africa is predicted to beat the world’s economies in the future with it’s population.

They will also discuss ease in movement of goods and cross-border remittance for the African markets to encourage African products and services.

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