The Central Bank of Congo (BCC) has taken a significant step forward in the financial integration of the Democratic Republic of Congo. At a recent meeting in Nairobi from September 16 to 18, Governor André Wameso Nkualoloki engaged in several major initiatives focused on cross-border payments, African monetary cooperation, and the digital transformation of central banks. A key development was the signing of an agreement for the DR Congo's accession to the Pan-African Payment and Settlement System (PAPSS).
The PAPSS membership aims to strengthen the interconnection of the national payment system with regional and continental infrastructures, facilitating cross-border transactions, reducing costs and processing times, and improving the traceability of financial flows. This move aligns with the African Continental Free Trade Area (AfCFTA) agenda, which relies on effective payment mechanisms to enhance intra-African trade. The DR Congo's integration into PAPSS is expected to boost its economic ties with other African countries.
In addition to the PAPSS agreement, Governor Nkualoloki signed a memorandum of understanding with the central banks of the East African Community (EAC) member states on currency convertibility and foreign exchange repatriation. This move enables the DR Congo to join Burundi, Uganda, Tanzania, Kenya, and South Sudan in a mechanism designed to facilitate transactions between economic operators in the sub-region, reducing costs, improving traceability, and streamlining trade.
At the African Central Banks Association (ABCA) symposium, Governor Nkualoloki highlighted the specificities of the Congolese economy, including its dollarized and multi-currency nature. He discussed measures taken to improve the functioning of the foreign exchange market and strengthen monetary policy transmission, such as adjusting reserve requirements and modernizing the foreign exchange market through specialized platforms.
The governor emphasized the need to mobilize domestic savings in national currency to provide long-term financing for the economy. To achieve this, he mentioned ongoing work with the government to establish a complementary pension fund mechanism in Congolese francs for state officials. This initiative aims to deepen the capital market and orient savings towards financing the economy and infrastructure.
The ABCA meeting addressed convergence, macroeconomic issues, and harmonization of monetary policy frameworks. The governors recommended that central banks pursue efforts to achieve macroeconomic convergence, with a focus on fiscal pressure, as only 25% of countries currently meet the set target. The meeting also discussed the operationalization of the African Monetary Institute.
Artificial intelligence (AI) was another key topic, with Governor Nkualoloki participating in a conference on AI in central banking. He highlighted the potential applications of AI in macroeconomic forecasting, banking supervision, payment system surveillance, and decision-making. However, he stressed the need for robust data governance, confidentiality protection, and technological infrastructure development.
Key points
- DR Congo's central bank has signed agreements to join the Pan-African Payment and Settlement System (PAPSS) and a currency convertibility mechanism with the East African Community (EAC).
- The agreements aim to facilitate cross-border transactions, reduce costs, and improve financial integration with other African countries.
- The DR Congo is also exploring the use of artificial intelligence in central banking to enhance macroeconomic forecasting, banking supervision, and decision-making.
