In a significant move to enhance economic integration in Africa, Ethiopia has adopted a payment system that allows trade within the African Continental Free Trade Area (AfCFTA) to be conducted in local currencies. This development eliminates the need for reliance on the U.S. dollar, making cross-border transactions more efficient and cost-effective.

Streamlining Trade with Local Currencies: Implementation of PAPSS

PAPSS facilitates instant cross-border payments among African nations, allowing Ethiopian businesses to engage in trade using the Ethiopian birr. This system not only simplifies transactions across borders but also reduces costs associated with currency conversion and dependence on foreign exchange reserves.

Strengthening Financial Cooperation

In addition to adopting the local currency trade framework, Ethiopia has pursued strategic agreements to support its economic agenda. These initiatives aim to facilitate seamless cross-border transactions and encourage stronger economic ties with trading partners both within and outside the continent.

Advancing African Economic Integration

Ethiopia’s commitment to using local currencies in trade reflects its support for the AfCFTA’s overarching goals: creating a unified market across African nations and fostering economic self-reliance. This shift underscores the broader vision of reducing dependence on foreign currencies, empowering regional economies, and enhancing Africa’s competitiveness on the global stage.

By embracing these changes, Ethiopia is playing a key role in advancing the vision of a more integrated and economically resilient Africa.