AU, ECOWAS BACKS AfDB PRESIDENT, AKINWUNMI ADESINA FOR REELECTION AS THE UNITED STATES CALLS FOR FRESH PROBE
By Kola King | The AfricaPaper
Abuja, Nigeria – The three-member Independent Review Panel led by former President of Ireland, Mary Robinson has cleared the President of African Development Bank (AfDB), Akinwunmi Adesina of corruption allegations. The Panel dismissed 16 allegations raised against him by whistleblowers in the Bank. Other members of the Panel include former Gambian Attorney General Hassan Jallow and the World Bank’s Integrity Vice -President, Leonard McCarthy.
“The Panel concurs with the findings in respect of all allegations against the president and finds that they were properly considered and dismissed by the Committee,” it stated in a document dated July 27. Furthermore, the Panel wrote, “It appears to us to be an undue burden to expect the holder of high office in an international organization, to prove a negative, in the absence of sufficient grounds.”
The clearance by the Independent Review Panel will serve as a major boost for Dr. Akinwunmi Adesina’s reelection in August. The findings seem a rebuff to the US Treasury Secretary Steven Mnuchin who instigated a fresh probe, having rejected the initial findings of the AfDB Ethics Committee. So far there’s been no reaction from the United States that pushed for a fresh independent probe of the allegations raised by whistleblowers.
Dr. Adesina has been in the news lately for the wrong reasons. Many had wondered who wanted Adesina’s head? And what is the motive? Despite being exonerated from allegations of unethical conduct by a committee set up by the bank’s Board of Governors, the United States and some non-regional members of the bank called for a fresh, independent probe of Adesina. Perhaps this may suggest that the non-regional members want a greater stake in how the bank is being run. Regardless of his travails, Adesina has displayed admirable competence and he seems to know his onions.
Within a short time, Adesina has changed the narrative of developmental financing for the continent. All throughout his international career, Adesina had cultivated a clean image both as a technocrat and scholar. His tenure as Nigeria’s Minister of Agriculture was without blemish. In fact, he was one of the most outstanding ministers in the Jonathan administration, which he served from 2011 to 2015. So, what is wrong?
So far, the Bank has consolidated its role as the continent’s premier development finance institution, a knowledge and research center, and the preeminent voice for African development issues. Since the AfDB views corruption, fraud, and other sanctionable practices as highly inimical to the achievement of its mandate, the bank has set up the Integrity and Anti-Corruption Department (IACD) which has the overriding mandate to carry out independent investigations into allegations of corruption, fraud and other sanctionable practices in Bank Group Financed Operations. IACD became operational in 2006, and its mandate is reflected in its independence, authority, access, and operations provided in its terms of reference.
Now, Adesina is fighting the battle of his life as a group of whistleblowers within the bank has cast aspersion on his reputation. To inquire into the allegations, the bank set up a committee to investigate him, and later the committee found him blameless of all allegations leveled against him. But the United States wants an independent investigation to revisit all the allegations leveled against the president of the bank, “so as to uphold high standards of ethics and governance,” according to US Treasury Secretary, Steven Mnuchin.
Notwithstanding all this, Adesina has repositioned the bank to serve Africa’s best interest. He has facilitated credit for African governments to build infrastructure, reduce poverty, and develop agriculture. Adesina has also addressed the current health and economic impacts of the coronavirus pandemic on the African continent. In March, the AfDB issued a $3 billion social bond to help African countries deal with the consequences of the coronavirus pandemic. The bank also has approved a $10 billion relief package for 2020, of which $6.9 billion will be financed by AfDB and the remainder through its concessional lending window. More importantly, the bank’s 81 stakeholders have pledged extra funds to more than double its capital of $208bn (170 bn Pounds). Adesina is the eighth elected President of the AfDB. He was elected on May 28, 2015. He’s up for reelection as the Chief Executive of the AfDB for another five-year term in August.
Under his watch, AfDB has been ranked fourth out of 47 global development institutions on its Aid Transparency index by Publish What You Fund (PWYF), a London based transparency agency. The index is the only independent measure of aid transparency among the world’s major development agencies. What is more, the index places the Bank in the highest category of transparency along with other world-class institutions such as the World Bank, the Asian Development Bank, and UNDP. Publish What You Fund ranked the Bank ‘very good’- The highest of the five categories used to assess organizations’ transparency. The ranking is based on several criteria including finance and budgets, basic information data, organizational planning, and performance.
“As large quantities of aid are being reallocated to deal with the Covid-19 emergency, the transparency of international aid is more important than ever,” said Gary Foster, CEO of PWYF, which has produced the index each year since 2011.
Only recently, S&P Global Ratings affirmed AfDB’s ‘AAA/A-1+’ long and short term issuer credit assessment of the AfDB with a stable outlook…”We are therefore affirming our ‘AAA’ long term issuer credit rating on the AfDB,” S&P Global stated. Furthermore, the rating agency stated that “The Bank has a very strong financial risk profile, capital adequacy, liquidity, extraordinary shareholder support and adequacy of its governance and management. (www.afdb.org. press release).
It is important to note that AfDB represents the bank that lends exclusively to African governments, representing one of the few non-China led and Western-funded approaches to development on the continent. Adesina is perceived as an eloquent advocate for Africa and the bank, and a good fundraiser to boot. He commands a lot of goodwill and respect from both international finance capital institutions and governments all over the world.
Many believe Adesina deserves a second shot at the presidency, considering his innovative approach and bottom-up development approach to Africa. Already both the African Union and the ECOWAS group have thrown their weight behind Adesina affirming their confidence in his leadership of the bank and supporting his bid for reelection. Fifty-four African countries are members of the bank. In this connection, ECOWAS stated that “In recognition of the sterling performance of Dr. Akinwunmi Adesina during his first tenure in office as President of the AfDB, the authority endorses his candidacy for a second term as the President of the bank.”
As expected, President Muhammadu Buhari had declared that “Nigeria stands solidly behind Akinwunmi Adesina in his re-election bid as the President of the African Development Bank. We will work with all leaders and stakeholders in AfDB to ensure that he is re-elected on the strength of his achievements during his term.”
Entering the fray, former Nigerian President, Olusegun Obasanjo has equally joined the bandwagon of those rooting for Adesina and kicked against the demand by the USA for a fresh, independent probe. In his letter to 12 former African presidents, Obasanjo said that Africa must stand up and not allow its institutions to be unduly controlled by non-African countries. According to him, “The bank has witnessed tremendous growth under Adesina’s leadership and has doubled its capital base since he took over.”
In a statement signed by fifteen former African presidents, including Olusegun Obasanjo and Goodluck Jonathan of Nigeria, the African statesmen described Adesina as the “pride of the continent,” and they lauded him for taking the bank to enviable heights. “No nation, regardless of how powerful, has veto power over the AfDB, and no nation should have such power,” they added.
But it appears some members of the Board of Governors are up in arms against his candidature. For one, the United States of America, which is one of the 27 non-regional members of the bank, and its second-largest shareholder, has expressed its displeasure over his candidacy for the simple reason that whistleblowers within the bank had petitioned the Board, claiming that Adesina runs the organization with impunity and that contracts were tinged with corruption. In a letter dated May 22, 2020, to Ms. Kaba Niale, Chairman Board of Governors, Steven Mnuchin, faulted the decision of the committee to totally exonerate Dr. Adesina of all allegations, saying it was not yet time to make such a decision.
Despite the fact that the Board had set up a committee to investigate all the allegations leveled against Adesina, after which the committee gave Adesina a clean bill of health, still the US has expressed reservations about the outcome of the investigations and called for more thorough and detailed investigations. The Chairman of the Board of Governors, Kaba Niale, who is also the Ivorian Minister of Planning and Development, had proposed “adopting the conclusions of the investigation by declaring that the president is totally exonerated of all allegations made against him.” Yet when the US Treasury Secretary, Steven Mnuchin mounted pressure, the AfDB Board reversed itself and caved into America’s demands.
“We fear that the wholesale dismissal of all allegations without appropriate investigation will tarnish the reputation of this institution as one that does not uphold high standards of ethics and governance,” Mnuchin wrote. “Therefore, the US cannot support dismissing the allegations at this stage.”
The AfDB board meeting is said to have agreed to an independent investigation into the allegations concerning Mr. Adesina’s conduct after Denmark, Sweden, Norway, and Finland supported the US position, Bloomberg news agency reported. The Board had remarked that the bureau must be allowed to carry out its duty and deliver justice on the matter.
However, the Nigerian government has rallied support for the President of AfDB. A letter by the Nigerian Minister of Finance, Zainab Ahmed, urged the board of the AfDB to ignore calls for an in-depth investigation of Adesina. Ahmed urged Chairman of the Board, Kaba Niale to follow laid down processes to protect and preserve the bank.
“The call for an independent investigation of the president is outside of the laid down rules, procedures, and governance system of the bank and its articles as it relates to the code of conduct on ethics for the president,” Ahmed stated. “As a bank, we must uphold the rule of law and respect for the governance systems of the bank.”
Earlier the Ethics Committee Chairman, Takuji Yano, a Japanese national had produced an eight-page report on April 26 that deemed “baseless,” “unsubstantiated” or “unproven,” the allegations made by a group of employees of the bank against the institution’s President, Akinwumni Adesina. The Ethics Committee has dismissed all the allegations in their entirety. Therefore, the Ethics Committee in its report to the bank’s Board of Governors on May 5, concludes that the complaint received on Jan. 19, “was not based on any objective and solid fact.”
The Ethics Committee Chairman explained that he reached this conclusion, with the help of information verbally communicated to the committee by the Director of the Office of Integrity and Anti-Corruption (PIAC) and by the bank’s auditor general during the committee’s meetings on March 26 and April 2. Yano criticizes the whistle-blowers for not having provided any supporting evidence for their claims. When they were asked to do so, they “declined on the grounds that they wished to conserve their anonymity,” Yano concludes in his report.
In a petition by a group of whistleblowers, Dr. Adesina was accused of 20 breaches of the bank’s code of conduct, including “unethical conduct, private gain, an impediment to efficiency, preferential treatment, a major conflict of interest and involvement in political activities,” among others. The group, which noted their allegations were in line with AfDB’s whistleblowing policy, said these activities adversely affected the confidence and integrity of the bank.
Dr. Adesina in his response maintained that he was innocent of all allegations of fraud leveled against him. He added that he believed a just, transparent, and fair process would prove his innocence. “I am confident that fair and transparent, and just processes that respect the rules, procedures and governance systems of the bank, and the rule of law, will ultimately prove that I have not violated the Code of Ethics of this extraordinary institution,” he said.
To this end, Adesina had produced detailed explanations to debunk all the grave allegations brought against him. In the 260-page document, Adesina severely condemns the methods used by the whistle-blowers. He described their complaint as “gratuitous and not based on any objective and proven facts,” and should be dismissed by the Committee.
“The purpose of the complaint is not to report fraud, corruption or other acts of misconduct,” says Adesina. “Quite the contrary, it has other hidden motives. The idea that other people are acting in concert with the whistleblowers is not pure speculation.”
Most of the allegations brought against Adesina include those relating to the two awards he received between 2017 and 2019, the World Food Prize and the Sunhak Peace Prize. The whistleblowers criticized him for not giving the prize money ($750,000) to the bank, as the bank had covered both his travel expenses and those of the large delegation that accompanied him. Adesina maintains that he donated the prize money from the two awards to help create the World Hunger Fighters Foundation and that the president’s children and spouses in attendance at these events paid their own way, rather than the bank.
Lastly, he explains that the AfDB staff did not attend the event because the president was the recipient of the World Food Prize, but because the bank was promoting the launch of its Technology for Africa Agricultural Transformation (TAAT) during these events.
Commenting on the TAAT initiative, a funding program for Africa’s agriculture sector, Adesina throws more light on payment, which the whistleblowers consider to be dodgy, of a negotiated contract of $5 million signed with Syngenta, a Swiss seed company. Although the condition under which the contract was awarded did, in fact, violate the terms of an agreement signed between the bank and TAAT, Adesina claims that the primary purpose of his intervention was to protect the bank’s reputation, as it had received threats of legal action, and to ensure both the quality of the project and future compliance with contractual rules.
In his rebuttal, Adesina posits that “His predecessor had given notice and he was entitled to a month of holiday pay. To ensure the continuity of the post, Fregene began working the moment his predecessor ceased performing the duties of his office.”
“As president [it is incumbent on me], to make sure that sound decision in the bank’s best interest is being taken in order to protect the bank’s reputation and ensure that it isn’t at risk of legal action which could harm its reputation and jeopardize its privileges and immunities,” Adesina submitted in his memorandum.
“Should it surprise the world that we’re getting a second investigation backed by no African country? What does that say about the other countries that have lined up behind the United States,” declared Debisi Araba, who worked with Adesina in the Nigerian government and was also an intern at the bank while doing his Ph.D. in 2009.
On Martin Fregene being hired in May 2017 and appointed as Adviser to the Vice-President on Agriculture, Human and Social Development, Adesina declared that Fregene is not his brother-in-law as claimed by the whistleblowers. Even so, Fregene was promoted Director of the Department of Agriculture and Agro-Industry only seven months later, while his predecessor was still serving as director. An audit report dated Nov 2019 indicated that the promotion did not comply with internal rules and that it resulted in the AfDB paying two salaries for the same post.
Also, on claims of “favoritism” that Nigerians had supposedly benefited from Adesina’s administration, the Ethics Committee itself backed Adesina, noting that two other countries, one African and the other “non-regional” each have “more officials at the bank than Nigeria does.”
“He’s due to run unopposed but you want to muddy the waters with this stain of corruption. I believe he will be vindicated,” Araba added.
Barbara Burungi, the bank’s former lead economist in Nigeria, stated that “Mnuchin’s move is significant because it has now cast the limelight on governance issues and on the importance of an in-depth investigation to uphold the integrity of the AfDB.” According to her, “There are very few people that were willing to stick their necks out.”
Meanwhile, the Board of Governors has appointed an Independent Panel made up of three “neutral, honest, high-caliber” persons to review the report of the internal Ethics Committee of the AfDB that cleared Adesina of all the allegations leveled against him. The Panel would not open up a new investigation. Former President of Ireland and ex-United Nations Human Rights Commissioner, Ms. Mary Robinson has accepted to serve as chairperson of the committee of three that would handle the review. Other members are Hassan B. Jallow and Leonard F. McCarthy. The panel is expected to submit its report within a period of two to four weeks.
Critics have described the ongoing crisis in the bank as one of imperialistic interference, neocolonialism, and Western plot against Africa’s interests, which is aimed at blocking Africa’s access to cheap credit, short-circuit its progress and impose Western imperialism through the backdoor. This is why this goes beyond the boardroom intrigues surrounding the departure of some senior executives of the bank as Adesina consolidates his power and authority on the institution, positioning himself for a smooth transition to a second term. Others have tied Adesina’s travails to the comments made by the President of the World Bank, David Malpass, who criticized the AfDB and other multilateral financial institutions for lax credit standards purportedly driving profligate African lenders towards debt distress.
On the contrary, Bright Simons, a policy analyst, and think-tank executive, writing in The Africa Report argue that the capital structure of the AfDB, with over 90% of the subscribed capital being ‘callable’(in basic terms, ‘pledged’) rather than paid in (similar to other MDBs in that regard), imposes a uniform burden on all its members, including the non-borrowing “foreigners, to backstop the large amounts of money the AfDB borrows to lend out to the “home” countries, some of who cannot obtain loans from even concessional lenders like the World Bank. Furthermore, he says, globalization of sovereign finance appears to be at play, which lays emphasis on strong governance systems and strict lending practices.
Despite a fresh independent investigation into allegations raised against him, which is at the bidding of the US and some non-regional members of the board, Adesina can count on the support of the 54 African regional members of the board, who have also condemned the fresh probe of the president. Whether Adesina’s reputation would remain intact will depend on the outcome of the fresh investigations being pushed by the US and some non-regional members. Still, the stakes are high. With Africa’s strong backing, Adesina looks good to clinch another five-year term as president of the AfDB, provided he comes out clean in the ongoing probe by the bank.
Indeed, Adesina is one of Africa’s brightest stars. Prior to his current appointment, he was Nigeria’s Minister of Agriculture and Rural Development from 2011 to 2015 during which he implemented bold policy reforms in the fertilizer sector and pursued innovative agriculture investment programs to expand opportunities for the private sector. During his tenure, he turned that lackluster ministry into a vibrant and dynamic set up and repositioned agriculture as a goldmine that is waiting to be tapped. Adesina not only galvanized the youth, but he was also able to raise an army of agriculture entrepreneurs through his support and commitment to the revamping of that critical sector of the economy.
Adesina is a distinguished developmental economist and agricultural developmental expert with 25 years of international experience. He was previously Vice-President [Policy and Partnerships] of the Alliance for Green Revolution in Africa (AGRA). He was also Associate Director (Food Security) at the Rockefeller Foundation in New York, where he worked for a decade (1998-2008) in senior leadership positions, including Regional Office Director and Representative for Southern Africa. Adesina was Principal Economist and Social Science Research Coordinator for International Institute of Tropical Agriculture (IITA), Principal Economist and Coordinator of the West Africa Rice Development Association (WARDA).
Adesina has received a number of global awards for his leadership and work in agriculture. Adesina received the Sunhak Peace Prize for achievements in promoting food security in Africa through agricultural innovation. In 2010, the United Nations Secretary-General, Ban Ki-Moon appointed him as one of 17 Global Leaders to spearhead the Millennium Development Goals, along with Bill Gates and President Paul Kagame of Rwanda. He was named the Person of the Year by Forbes Africa magazine in 2013.
Adesina earned a B.Sc. first-class degree in Agricultural Economics from the University of Ife (Obafemi Awolowo University) in 1981. He obtained his Ph.D. in Agricultural Economics in 1988 at Purdue University in the United States, where he won the outstanding Ph.D. Thesis Award for his research work. He also won the prestigious Rockefeller Foundation Social Science Post-Doctoral Fellowship in 1988, which launched his international career in global agricultural development. TAP