The EAC Secretariat and the African Development Bank (AfDB) signed a US$ 23 Million Grant Agreement for support of a Payment and Settlement Systems Integration Project (EAC–PSSIP).
The Agreement was signed by EAC Deputy Secretary General Dr. Enos Bukuku on behalf of the EAC Secretary General and Mr. Gabriel Negatu, the AfDB Regional Director.
The signing took place on January 28, at the AfDB East Africa Resource Center in Nairobi, Kenya.
EAC-PSSIP is an integral part of the EAC’s Financial Sector Development and Regionalization Project’s higher level objective of broadening and deepening the financial sector and is aimed at complementing the integration of the regional financial market infrastructure to facilitate the undertaking of cross border funds transfers in support of the economies of the region as a whole, together with providing outreach to rural areas in order to encourage greater participation in the formal financial sector.
The EAC-PSSI, whose objective is to contribute to the modernization, harmonization and regional integration of payment and settlement systems specifically aims at:
i. Enhancing convergence and regional integration of payment and settlement systems; and,
ii. Strengthening a harmonized legislative and regulatory financial sector capacity in the Partner States.
The Project is structured under the following components:
Component 1: Integration of financial market infrastructure through the integration of Real Time Gross Settlement (RTGS) across the region and the centralization in a single database of all regional payment flows;
Component 2: Harmonization of financial laws and regulations;
Component 3: Capacity building by strengthening of financial sector regulatory and legislative capacities.
During the signing ceremony, the AfDB Regional Director, Mr. Gabriel Negatu highlighted the importance of this project which is aligned to the 4th EAC Development Strategy and the EAC Common Market Protocol.
He mentioned that the Project will focus on trade facilitation, establishment of a single market in financial services, establishment of the EAC Monetary Union and integration of ICT into regional development initiatives, amongst others.
On his part, the EAC Deputy Secretary General in charge of Planning and Infrastructure, Dr. Enos Bukuku reiterated the commitment of the EAC Secretariat in ensuring that this project contributes to the modernization, harmonization and regional integration of payment and settlement systems for the overall progression of the payment and settlement systems under the Financial Sector Development and Regionalization.
The signing of this agreement comes after extensive consultations with key stakeholders (EAC Partner States’ Central Banks, Commercial Banks and Financial Services Providers) which enabled the conclusion of negotiations between AfDB and the EAC Secretariat that took place on 30 October 2012 in Tunis, Tunisia.
This was followed by the approval of the project by the AfDB Board on 5 December 2012.
The EAC Deputy Secretary General was accompanied by Mr. Tharcisse Kadede, Director of Planning and Mr. Godfrey Kazinduka, Resource Mobilization Specialist for the EAC Financial Sector Development and Regionalization Project (EAC-FSDRP).
EAC
Leave a Reply