The US and the African Development Bank
have fallen out over allegations of corruption against the bank's
Nigerian head, writes former BBC Africa Business editor Larry Madowo.
Akinwumi Adesina is a sharp dresser known for
his expensive tailored suits, immaculate white shirts and an endless
supply of colourful bow ties.
But the clean public persona of the
60-year-old president of the African Development Bank (AfDB) is now
being questioned after a string of corruption and abuse of office
allegations from his own staff spilled into the open. Mr Adesina has
denied all the allegations.
The board of governors of the 55-year-old
institution met on Tuesday to discuss whether to bring in an outside
investigator into the allegations concerning the Nigerian's conduct just
days after the US rejected an initial inquiry that cleared him.
The prospects of an independent probe comes
only three months before he was expected to be re-elected unopposed at
its annual general meeting in August.
US at odds with Africa
The 20-point allegations of "impunity and bad
governance" from unnamed employees have exposed a rift between Mr
Adesina and ordinary staff.
The "Group of Concerned Staff Members of the
AfDB" claimed that Mr Adesina has used the bank's resources for
self-promotion and personal gain while also paying out huge but
undeserved severance packages to staff who resigned mysteriously, and
favouring his fellow Nigerians.
US Treasury Secretary Steve Mnuchin
personally signed a letter to the board rejecting an internal
investigation that cleared Mr Adesina.
"Mnuchin's move is significant because it has
now cast a limelight on governance issues and on [the] importance of an
independent investigation to uphold the integrity of the AfDB," said
Barbara Barungi, the bank's former lead economist on Nigeria. "There are
very few people that were willing to stick their necks out."
Besides the core 54 African countries, the US
is one of the 27 non-regional members of the AfDB and its second
largest shareholder.
AfDB's 10 biggest shareholders:
- Nigeria: 9.1%; US: 6.5%; Egypt: 5.5%; Japan: 5.4%;
- South Africa: 4.9% Algeria: 4.1%; Germany: 4%;
- Canada: 3.8%; Ivory Coast: 3.7%; France: 3.6%
"I think AfDB is Africa's most valuable institution," said one insider who spoke on condition of anonymity.
"But what you have now is the biggest
paymaster, the US, in a stand-off against the Africans. If you read
Mnuchin's letter carefully, it has put the bank on notice."
The BBC has obtained the original
whistleblowers' email from January 2020, sent to two executive directors
of the bank, Yano Takuji (Japanese) and Steven Dowd (American), and the
British director for its Integrity and Anti-Corruption Department Alan
Bacarese.
In an April update circulated to a wider pool
of senior managers, the whistleblowers said the Ethics Committee headed
by Mr Takuji failed to examine their concerns.
The committee later carried out an
investigation and declared that Mr Adesina was "totally exonerated of
all allegations made against him" and recommended that the board of
governors adopt its conclusions.
In early May, the board's chair - Ivorian
Planning Minister Nialé Kaba - wrote to shareholders that the African
finance ministers who supervise the bank's management intended to clear
Mr Adesina.
"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," Mr Mnuchin wrote back.
"Therefore, the United States cannot support dismissing the allegations at this stage," he added.
Mr Kaba said in a statement that a decision had not been made about Mr Adesina and he remained in office.
"The bureau, which I chair, wishes to
reassure the public that it is seized with the matter and it is treating
it with the utmost seriousness that it deserves," he said.
'Trumped up allegations'
The whistleblowers have accused Mr Adesina of
major conflicts of interest in his dealings with current and former
employees, unethical conduct and preferential treatment.
Eight things about Akinwumi Adesina:
- First Nigerian to lead AfDB
- Elected for five-year term in September 2015
- Was Nigeria's agriculture minister from 2011 until his move
- Named Forbes Africa Person of the Year in 2013 for his "bold reforms" in farming sector
- Was told by an academic in Nigeria he would never get into Purdue University as his maths was poor
- Proved him wrong by getting into the prestigious US institution
- Cancelled his admission to UK's respected Cambridge University
- Got his PhD in agricultural economics in 1998
Sources: AfDB; Forbes magazine
Mr Adesina, who holds a PhD in agricultural
economics from Purdue University in the US, did not respond to BBC
requests for comment but released a statement.
"In spite of unprecedented attempts by some
to tarnish my reputation and prejudice the bank's governance procedures,
I maintain my innocence with regard to trumped up allegations that
unjustly seek to impugn my honour and integrity," he wrote.
"I am confident that fair, transparent and
just processes that respect the rules, procedures and governance systems
of the Bank, and rule of law, will ultimately prove that I have not
violated the Code of Ethics of this extraordinary institution."
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 first reported.
"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 US?"
wonders Debisi Araba, a friend of Mr Adesina's.
"He's due to run unopposed but you want to muddy the waters with this stain of corruption. I believe he will be vindicated."
Mr Araba worked for Mr Adesina in the Nigerian government and was also an intern at the bank while doing his PhD in 2009.
He says the bank has always had a culture of
salacious rumour and gossip but faults the US for formalizing the
"crass, bargain basement reasoning" into a complaint.
This was denied by a US Treasury
spokesperson, who told the BBC: "The United States continues to value
the AfDB and its efforts to promote development, reduce poverty, and
address the current health and economic impacts of the coronavirus
pandemic on the African continent."
Chinese 'shopping spree in Africa'
Some policy analysts at think-tanks in
Washington, DC, worry about the timing of the American pushback and its
longer-term consequences in Africa.
"A prolonged battle will be a distraction for
the AfDB when its resources are more desperately needed than ever for
its borrowers," Nancy Birdsall, a Senior Fellow at the Center for Global
Development told the BBC.
She said it was not good for the AfDB if Mr
Mnuchin was unhappy and suggested that "the US Treasury should look for
some form of quiet compromise in which no-one loses face".
Ms Birdsall also reiterated a recommendation
she made in a 2018 paper for the leadership of the AfDB to open up its
shareholding, including to China and oil-rich economies.
But Daniel F Runde, senior vice-president at the Center for Strategic and International Studies, disagreed.
He said the Abidjan-based bank that lends
exclusively to African governments represented one of the few
non-China-led and western-funded approaches to development on the
continent.
"If Adesina is cleared, the US may need to
mend fences with the management because China will probably go on a
shopping spree in Africa after Covid-19, and we will need every
non-Chinese tool to respond," he said.
Mr Runde saw Mr Mnuchin's letter as "disruption" and called it a good tactic but a poor strategy.
"Now that the Trump administration has caused
disruption and perhaps made a point, they have to decide when this
plays out," he said.
Last October, the 81 shareholders of the bank pledged extra funds to more than double its capital to $208bn (£170bn).
Missouri Congressman Emmanuel Cleaver, who
sponsored a bill backing the capital increase in the US House of
Representatives, came out in support of the new inquiry.
"Independent accountability measures
strengthen institutions and reinforce their legitimacy - both
domestically and internationally. I am pleased the African Development
Bank's Board agreed to take this important step," the Democrat told the
BBC in a statement.
Mr Adesina is an eloquent advocate for Africa
and the bank and a good fundraiser, but his detractors say he promises
more than he delivers.
"His administration hasn't always been
fantastic and perhaps he has run roughshod over some people. Maybe the
practices haven't always been what they should be, and the feeling is
that the board just whitewashed the investigation," the insider said.
Accused of favouring Nigerians
The whistleblowers also accused Mr Adesina of preferential treatment for Nigeria and Nigerians.
"I don't think we should trivialise the
issues and reduce them to anti-Nigerian sentiment," said Ms Barungi, the
Ugandan-born, Lagos-based former bank employee.
"It's really more about governance concerns that require attention and the investigation to help clear the air," she added.
Mr Araba, a Nigerian, said talk of the
"Nigerianisation of the bank" was false as the country was
under-represented in employee numbers despite being the largest
shareholder.
As the crisis at the bank escalates,
employees, consultants and government officials in African capitals, as
well as American foreign policy nerds, wonder how this impasse will end.
But at the Treasury building right next to the White House, Mr Mnuchin and his advisors are doubling down.
"Undertaking an independent evaluation of
facts is not at odds with a presumption of innocence, and by promoting
transparency and good governance, it can only strengthen the AfDB's
capacity to deliver results to people across Africa," the spokesman told
the BBC.
Mr Adesina's carefully curated career could
crumble if a new investigation criticises his reign at the AfDB. His
style is solid, but the substance is now under scrutiny.
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