Board endorses probe of AfDB President following US pressure

Isola Moses | ConsumerConnect

Sequel to an intensive pressure by Steven Mnuchin, United States (US) Treasury Secretary and other shareholders who have rejected plans by the Board of Governors of the African Development Bank (AfDB), Abidjan, Cote d’Ivoire, to end an investigation into Dr. Akinwumi Adesina by calling for an independent probe into allegations against him, the AfDB Board has agreed to an independent probe of President, Dr. Adesina.

ConsumerConnect had reported that the AfDB President has been accused of favouritism, according to two people familiar with deliberations on the matter.

Africa’s largest multilateral lender decided on the inquiry after several governments backed US Treasury Secretary Steven Mnuchin’s criticism of a bank-led examination into the allegations, the people said, asking not to be identified because details aren’t public, according to Bloomberg.

However, Adesina who repeatedly, has denied any wrongdoing may have to step back from the role until the probe is completed, the report indicated.

It was further learnt that unidentified whistleblowers accused Adesina, 60, of handing contracts to acquaintances and appointing relatives to strategic positions in AfDB.

The Abidjan-based lender declined to comment, and Adesina didn’t respond to an e-mailed request seeking comment, while a call to his mobile phone didn’t connect, the report said.

African Development Bank Headquarters, in Abidjan, Cote d’Ivoire

The proposed investigation comes three months before the bank’s annual meeting, at which Adesina is the sole candidate to extend his five-year term as the President and Chairman of the Bank.

The AAA-rated lender’s 80 shareholders in October pledged to provide funding that would help to more than double its capital base to $208 billion.

Denmark, Sweden, Norway and Finland are among countries that wrote to the AfDB to back the Mnuchin’s demands for professional outsiders to look into the allegations, the people said.

Mnuchin last week wrote to the AfDB to express “deep reservations” about the integrity of the lender’s ethics committee, after it exonerated Adesina.

The scope and detail of the allegations are serious enough for a further inquiry to ensure the AfDB’s shareholders have confidence in the bank’s leadership, Mnuchin said in the May 22 letter addressed to Niale Kaba, the Chairwoman of the Bank’s Board of Governors.

The US is the AfDB’s biggest shareholder after Nigeria, Adesina’s home country.

The demands for an independent probe are aimed at ensuring that if the allegations are baseless, the process of reaching that conclusion is public and transparent, one of the people said.

Shareholders of the AfDB include 54 nations on the continent and 27 countries in the Americas, Europe, Middle East and Asia.

It has an AAA rating from Fitch Ratings, Moody’s Investors Service and S&P Global Ratings, stated the report.

Africa’s Support

Prior to Mnuchin’s letter to the board, African leaders including South African President Cyril Ramaphosa and his Nigerian counterpart, Muhammadu Buhari, expressed support for Adesina and commended him for his efforts at helping to secure funds for Africa to deal with the fallout from the disease.

US criticism of the bank’s internal processes follows comments by World Bank President David Malpass in February that multilateral lenders including the AfDB tend to provide loans too quickly, and, in the process, add to African nations’ debt problems.

The bank rebutted the statement, saying it undermines its governance systems, impugns its integrity and that there is no risk of “systemic debt distress” on the continent.

In March 2020, the AfDB issued a $3 billion Social Bond to help African countries to deal with the fallout from the Coronavirus pandemic.

The bank also launched a $10 billion crisis-response facility for African nations.

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