Summary:

In early February 2024, Tunisia formally joined the Pan African Payment and Settlement System (PAPSS), becoming the 13th Central Bank member of the cross-border payment settling system developed by the African Export-Import Bank (Afreximbank). 

Prior to his replacement by the new Central Bank Governor, Former Governor Marouane El Abassi oversaw Tunisia’s joining of PAPSS. The PAPSS system was developed by the Afreximbank and the African Union to support regional trade in Africa by facilitating the real-time settlement of payments in numerous African currencies.  

Following its launch in 2021, PAPSS has grown to include a network of 13 African Central Banks, including Nigeria, Ghana, Guinea, Gambia, Liberia, Sierra Leone, Kenya, Rwanda, Djibouti, Zimbabwe, Zambia, and Malawi. Tunisia is the first North African country to join PAPSS. 

Outlook: 

Tunisia’s integration into PAPSS creates opportunities for economic connectivity between Tunisia and other regions of the African continent. Connectivity between various regions in African is limited for many overlapping reasons, including due to the challenge of settling cross-border payments that often leverage US dollars as a common currency. 

PAPSS could serve as one additional step toward integrating Tunisian businesses into the diverse set of African markets touched by the system. The ability for businesses to conduct cross-border transactions could increase trade volumes as well as the diversity of products that are both imported and exported. 

The system could also encourage Tunisian businesses operating in informal and grey markets to pursue formalization and participation in the financial system, incentivized by the ability to more easily access other markets. 

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