Revolutionising the Future of African Trade through the Pan-African Payment and Settlement System

Welcome to your December edition of the Africa Bulletin.

This month our focus is on the transformative role of the Pan-African Payment and Settlement System (PAPSS) in shaping the future of African trade within the African Continental Free Trade Area (AfCFTA). As AfCFTA progresses through negotiation phases, operational tools like PAPSS have become crucial for its successful implementation. PAPSS, recognised as a key instrument for AfCFTA, is poised to revolutionise cross-border trade throughout Africa.

Significant strides are being made as more African Central Banks, including the recent addition of the Central Bank of Kenya, join the PAPSS platform. With an ambitious goal of achieving full central bank participation by 2024 and encompassing all regional commercial banks by 2025, PAPSS is expected to enhance financial integration and efficiency across the continent.

Our focus also explores major African business narratives impacting the region and the globe at large. These stories interconnect with comprehensive reports centred on Africa's real estate and construction market, energy transition, carbon pricing and FinTech.

As always, we've curated news stories to navigate you through today's business environment, offering a global perspective on the legal issues relevant to your industry.

We are ALN. One region, One vision, One ALN.

Top Story

As The African Continental Free Trade Area (AfCFTA) advances through various negotiation phases, several stakeholders have introduced operational tools to facilitate its implementation. One of these tools is the Pan-African Payment and Settlement System (PAPSS), which aims to play a key role in unlocking trade with AfCFTA. PAPSS, which hopes to achieve full Central Bank participation by year-end, recently welcomed the Central Bank of Kenya, making it the tenth African Central Bank to join the platform.

The Pan-African Payment and Settlement System, a cross-border financial market infrastructure, is the result of collaborative efforts by the African Union and Afreximbank. Officially inaugurated in January 2022 in Accra, Ghana. This innovative system aims to connect African banks, payment service providers, and other financial intermediaries to enable instantaneous and secure...Read more.

1. Africa | World Bank to Allocate USD 5 Billion to Provide Electricity for 100 Million Africans - The World Bank has announced that it has concluded plans to allocate USD 5 billion to bring electricity to 100 million people in Africa by the end of the decade (2030). This was made known...Read more.
2. East Africa | East African Countries Picked for Clean Energy Pilot - Tanzania, Rwanda and Somalia are among four countries selected as pilots of a new World Bank clean energy programme that is set to benefit at least 100 million people in Sub-Saharan Africa by 2030. Sao Tome...Read more.
3. Algeria | USD 42 Billion Plan Unveiled for Energy Sector Expansion - Algeria has embarked on a substantial enhancement of its gas production capacities, signalling a major shift in the energy sector. The Minister of Energy confirmed that several new gas fields have recently...Read more.
4. Kenya | Kenya Secures USD 4.5 Billion for Green Projects Development - Kenya recently announced a significant milestone with the signing of green manufacturing agreements totalling USD 4.48 billion during the launch of the Africa Green Industrialisation Initiative (AGII)...Read more.
5. Morocco | Morocco Tops Ranking of Most Technologically Advanced Countries in Africa - Morocco topped a list of Africa’s 15 most technologically advanced countries. The country ranked ahead of countries including South Africa, Egypt, and Kenya, according to a report...Read more.
6. Nigeria | Climate Action Can Attract USD 94 Billion Capital from Retail Investors, says Report - The latest Sustainable Banking Report 2023 said USD 94 billion of retail investor capital could be mobilised towards climate climate investments in Nigeria by 2030. The research based on...Read more.
7. South Africa | Country to Add 2,500 MW Nuclear Capacity - South Africa recently announced the initiation of a 2,500 megawatts new nuclear procurement process, with plans to launch Requests for Proposals by March 2024. The National Energy Regulator of South Africa approved...Read more.
8. Tanzania | Tanzania Secures One of Africa’s Largest Carbon Credit Deals - Tanzania has inked a deal for a land-based carbon credit project, which currently stands as one of the largest carbon deals in East Africa. This monumental project is designed to span six national parks...Read more.

Reports

State and Trends of Carbon Pricing: International Carbon Markets | World Bank

As developing nations grapple with the large financing needs required to achieve our climate goals, the urgency to mobilise substantial capital towards communities, nature, and broader developmental efforts is resoundingly clear. In this context, carbon markets, both under the Paris Agreement and the voluntary carbon market, can channel much-needed finance towards climate action.

This report aims to supplement the State and Trends of Carbon Pricing annual report and contribute to the global effort to promote market transparency and trust by providing digestible insights into the state of play of international carbon markets.

Click here to download and read the report.

Driving Financial Inclusion in Africa | BCG and Elevandi

Africa’s fintechs can stretch beyond payments solutions to microfinance and insurance. New financial technology (fintech) platforms have played a critical role in Africa in recent years in improving financial inclusion – making financial services accessible to everyone, regardless of their personal net worth or company size.

This report from Boston Consulting Group, in collaboration with Elevandi, “Driving Financial Inclusion in Africa”, highlights the growth of financial inclusion in Africa since M-PESA was founded. While four countries are growing financial inclusion above the regional average, fintech ecosystems in other African countries are maturing and attracting more investment.

Click here to download and read the report.

The Africa Report | Knight Frank

Knight Frank’s biennial 2022/23 Africa Report, presents optimism for the fortunes of Africa’s real estate markets, although clearly, lingering COVID-related legacy challenges remain and are in some cases being exacerbated by global geopolitical events.

The retail landscape has experienced a very mixed picture, with some markets enjoying resilient demand for space in smaller, community shopping centres, while other locations face the threat of oversupply and depressed rents. This report boasts coverage of property markets in 22 countries, including three market insight articles examining some of the most pressing issues facing real estate around the continent.

Click here to download and read the report.

Energy Transition Support to Strengthen Climate Action | IRENA

Achieving net-zero greenhouse gas emissions by 2050 will require much more ambitious actions by 2030. Renewable energy is key for the energy transition to 2030, as it is a readily available and economically feasible option for mitigating the impacts of climate change. Despite progress in the energy transition, the current pace of renewable energy growth is still behind the level required to achieve the 2050 climate goal.

This report analyses progress in selected IRENA Members toward realising renewable energy targets in Nationally Determined Contributions and long-term low emission development strategies, highlighting the activities of the Agency to support climate action work packages.

Click here to download and read the report.