PRESS RELEASE

COMMUNIQUE DE PRESSE

Year 2014 Selected
En Français
N°: 122/2014
25 June 2014 [Dakar-Sengal]

ECOWAS NUDGES MEMBER STATES TOWARDS PAYMENT SYSTEMS INTEGRATION

							
	The ECOWAS Commission has called on Member States to intensify efforts toward
the setting up of a regional Payment and Settlement System, as a key component
of an ECOWAS Common Investment Market (ECIM) and a necessary building block for
the establishment of 
an economic-union. 

In an address to the Central Banks Payment Systems Experts’ meeting which opened
on Wednesday 25th June 2014 in Dakar, Senegal on the establishment of the EPSS,
the Commissioner for Industry and Private Sector Promotion Mr. Kalilou Traore,
said the “EPSS (ECOWAS Payment and Settlement System) programme is one of the
roadmap activities for the realization of ECOWAS single currency, and in tandem
with steps already taken by some Regional Economic Communities (RECs) across the
African Continent.”

“I believe that you are well familiar with this process, having implemented
similar systems in your respective central banks, though at national levels,”
the Commissioner told the experts, adding that the goal is to “promote monetary
and financial integration, facilitate intra-Community trade in goods and
services and the realization of the Community's objective of establishing an
economic union in line with Article 2(e) of the ECOWAS Revised Treaty. ”

He also reminded them that Article 52 of the Revised Treaty “empowers the
Committee of Governors of Central Banks of ECOWAS Member States to make
recommendations to the ECOWAS Council of Ministers, on the operations of the
clearing system and of payments as well as other monetary issues. ”

A key requirement on each Member State for the attainment of a regional economic
union is “efficient and effective national payment system that is
internationally acceptable and that would ultimately be interlinked within the
region,” the Commissioner said, in the address read on his behalf by Mr. Peter
Oluonye, the focal point and Principal Programme Officer at the Private Sector
Directorate of the Commission.

“Luckily, the EPSS study revealed that with only Guinea Bissau and Liberia, all
the banks in the rest 13 countries in the region are already operating on the
Real Time Gross Settlement (RTGS) system, which is a critical pre-condition for
the operation of the EPSS,” the Commissioner revealed, adding that  the
Commission is using a strategic approach in the EPSS process with the
participation of all regional stakeholders including regional central banks,
national interbank payment and settlement systems, West African Monetary Agency
(WAMA) West African Bankers Association (WABA),  switch operators in the region,
and with inputs from the World Bank.

He listed the expected benefits from the EPSS to include guarantee of prompt
payment to the exporter - at the latest by the next day that the importer
deposits the required amount at its Commercial Bank within the Member State;
building of trust amongst traders that would lead to an increase in
intra-regional trade and drastic reduction in the cost of intra-regional trade
transactions and remittance.

Others are leveling of the playing field by getting all commercial banks to deal
directly with one another without having to go through banks outside the region;
predictability in payment timing and reduced payment cycle time as compared to
other international payment alternatives; lower cost and quick turn-around of
EPSS payments translates into savings for the importer; and easy process for
making cross-border payments at retail and wholesale levels.

Given the “importance attached to EPSS in our economic integration,”
Commissioner Traore urged the experts to thoroughly examine the submissions by
project consultants and make recommendations to the forthcoming Committee of
Central Bank Governors Meeting.”

“With EPSS, the need for correspondent banking to facilitate trade transactions
between ECOWAS Member States will soon be unnecessary, ” he affirmed. 

The report of the ongoing meeting will be considered by a two-day WAMA experts
meeting which begins on Friday 27th June that will feed into the Central Banks
Governors meeting next week, all in the Senegalese capital.


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