The African Development Bank’s helmsman, Nigerian-born and America-trained Akinwumi Adesina has been in the news recently.
Strangely, this time, there are unpleasant allegations being leveled against him. I say strangely because those who are knowledgeable about international development will readily agree that the name Akinwumi Adesina is synonymous with stellar accomplishments. So naturally, much more than an average level of curiosity will come to bear about the allegations against the AfDB President, whose first term is set to lapse in a few months.
From a widely circulated Whistleblower complaint document, a string of permutations that stretch to the point of accusing Adesina of creating a Directorate at the Bank to oversee the healthcare of his wife, quickly stand out.
Quite understandably, upon reading these allegations, one would immediately conclude that the African Development Bank has endured its worst years under Adesina’s leadership, and is currently in ruinous waters, sailing up the proverbial “Shit Creek”. But the realities testify to the contrary.
The AfDB, for four years in a row, received an AAA rating from the four major global rating agencies, a confirmation that the Bank has been considered, year-on-year, to possess excellent liquidity, sound financial and risk management, as well as strong shareholder support.
A MAN WITH A HISTORY
As an administrator, Adesina has a track record of being an avid reformer. One of such is his past record at the Nigerian Ministry of Agriculture and Rural Development where he served out a four-year term as Federal Minister. His robust reform of the fertilizer supply system in the country is still fresh and unprecedented. He made many enemies, but even more friends.
Adesina has never hidden his propensity for taking the lid off the “status quo”. On arriving at the AfDB in September 2015, the new President spelt out a five-point strategy which he christened the “High5s”. The strategy was designed to provide transformational development for Africa over a ten-year period in five critical areas: electricity, agriculture, industrialisation, integration, and improved livelihood. In Adesina’s view, achieving these development targets with respect to Africa, are key to opening the fortune of its people and achieving the global Sustainable Development Goals (SDGs).
All, including his worst critics agree that under Adesina’s watch, the African Development Bank has truly served Africa. The last five years have seen the Bank carry out highly impactful programs that have significantly accelerated the development of the continent. Under his watch, the Bank has recorded commendable upshoot in its financials within the same period, with loan income going up from $563 million in 2015, to $803 million in 2017. By the end of 2017, its net operating income stood at $781 million from a 2015 figure of $492 million. In the same year, the Bank achieved a historic allocation of net income to reserve of $190.35 million.
Scrutiny expectedly attended the positive numbers but only culminated in praises for the Bank. For example, the global watchdog for aid transparency, Publish What You Fund, ranked the AfDB as the fourth most transparent out of 45 global institutions audited by the organisation. Similarly, in an unprecedented outcome, the Multilateral Organisations Performance Assessment Network (MOPAN) ranked the institution as the number one performing multilateral organisation, a position it shared with the World Bank Group.
A MAN ON A MISSION
“I have lived the last four years for Africa,” Adesina told a group of investors in a Deal Room at last year’s Africa Investment Forum in South Africa. “In these four years”, he continued, “I have worked to make sure that you can invest on the continent and get good returns”. Among several immediate reactions to this message was the commitment of global investors to a series of bankable deals. Among them, multinationals such as OLAM, which committed to a $1 billion investment in the Bank’s Special Agro-Industrial Processing Zone (SAPZ) project on the continent. This was just one of several investment commitments at the Forum totaling $40.1 billion.
In its launch year in 2018, the Africa Investment Forum mobilised $38.7 billion worth of investment interests for Africa in less than 72 hours. Like a man possessed, Adesina made a personal entry into all the Deal Rooms, insisting that the investors could count on Africa to deliver. Deploying the mechanism of the Africa Investment Forum, the AfDB and its partners intend to attract some $300 billion worth of investments into Africa over an eight-year period.
Typical of his hands-on approach towards leadership, Adesina has decentralised the AfDB. The Bank opened five regional development and business delivery offices in Tunis, Pretoria, Yaounde, Nairobi and Abidjan to service the North, South, Central, Eastern and Western regions of the Continent. “The reason for this is simple,” in the words of the AfDB President, “We need to feel the pulse of our member countries and clients.” Five Director Generals are now charged with running the affairs of these regional offices, and they are saddled with an ever increasing share of the AfDB’s integral operations. Personnel records show that the percentage of the Bank’s operational staff based outside of its headquarters in Abidjan rose from 29 percent in 2011 to 59 percent by the end of 2018. In addition, the share of its operations managed from the regional and country offices rose from 30 percent in 2011 to a whopping 76 percent by the end of 2018.
This should naturally be the premise for increased operational cost, right? Well, not when Adesina is at the helm! The AfDB has the lowest administrative cost per adjusted common equity among all multilateral development banks, standing at just 2 percent. A comparative example would suffice to drive home this point. While the AfDB’s cost to income ratio stands at 41 percent, the comparable figure for the World Bank is 113 percent. Simply put, this means that the African Development Bank is three times more efficient with its administrative costs. The comparison with the World Bank here is informed by the fact that it held joint first position with the AfDB in the 2018 MOPAN audit.
In addition, the AfDB has been an avid head hunter in the last four years, recruiting as many as 680 staff in 2018 alone – the highest recruitment tally in the history of the Bank. Meanwhile, an independent assessment of preferred employers in Africa saw the AfDB ranked number 4 in 2018, as against a 2015 ranking of 82.
A MAN OF SUBSTANTIAL ACHIEVEMENTS
So far, in the lead up to AfDB’s Presidential election in May 2020, no opponent has climbed into the ring to take on Adesina. With his stellar performance and the unprecedented achievements recorded by the AfDB under his five-year term, this does not come as a surprise. The Bank’s reputation and standing among global financial institutions has never been stronger. As an institution, it continues to provide Africa with huge leverage. Under Adesina‘s leadership, the AfDB has morphed into a nimble development giant willing, able and ready to deploy its resources for the good of the African continent.
In an independent analysis carried out by the United Nations Development Programme (UNDP) on the Bank’s five strategic priorities, the international development agency observed that a full implementation of the High5s would guarantee that Africa attains 90 percent of its SDG targets and 90 percent of the Agenda 2063 of the African Union.
Under Adesina‘s presidency, the Bank has spearheaded an astonishing shift in the developmental realities of the African continent. Through its support, 18 million people can now connect to electricity, 141 million people have been able to gain direct access to improved agricultural technologies, 13 million people are now directly captured within the benefit trail of private sector industrialisation investments, 101 million people have been able to access better transportation services, and 60 million people have benefitted from improved access to clean water and sanitation. These stellar impact outcomes pretty much sum up the result sheets for Light Up and Power, Feed, Industrialize, Integrate, and Improve the Quality of Life of Africa and Africans – the High 5s.
A testimony of the confidence reposed in Adesina, was the Bank’s successful 125 percent General Capital Increase (GCI) in 2019, that moved it’s authorized share capital from $93 billion to $208 billion. It’s worth noting that no President of the Bank has sought a General Capital Increase during a first term in office. For Adesina, it was a risky gamble that paid off. From all indications, the AfDB President has set his sights on more ambitious objectives over the next eight years.
Adesina‘s efforts have not gone unnoticed. Aside from the 2017 World Food Prize Award and the 2019 Sunhak Peace Prize, Adesina was recently named the African of the Year by Forbes Africa magazine. Further testimony of his visionary leadership was provided by the African Leadership Newspaper Group, following an open continent-wide voting process. After garnering 60 percent of the votes cast, the publication recently named him the 2019 Africa Person of the Year. The decision of all 55 Heads of State and Government of the African Union to endorse him for a second term as President of the AfDB did not come as a surprise considering his unparalleled achievements as helmsman at the Bank. What rather came as a surprise, was the petition against Adesina’s management of the AfDB brought by certain aggrieved staff members of the Bank under its whistleblower policy.
A MAN ON TRIAL
Once the stage appeared set for a second term for Adesina, it became increasingly evident that his achievements had not gone down well with everyone at the Bank. By the early part of January 2020, a document containing complaints made to the Bank’s Ethics Committee by some staff under its Whistleblower Policy, was circulated in the public domain and by March, it had fallen into the hands of journalists at Le Monde, a French afternoon newspaper who broke the story under the headline: “President Adesina Challenged by Employees at the African Development Bank”. Typical of the contemporary challenges of media reportage, the article sought to paint a picture depicting the AfDB as an institution steeped in a crisis of confidence. As the writers put it, the investigation was being hushed on account of its ‘embarrassing’ nature, given that it relates to the President of the Bank. It goes on to detail the Petitioners’ grouses against Adesina to include “favoritism for the benefit of relatives and compatriots, hindering efficiency and eroding confidence in the integrity of the Bank”.
The writers however made an effort to indicate that the Whistleblowers were already split amongst themselves. A breakaway faction had since accused the Bank’s Executive Director representing the United States of America, who at the time was an active member of the Bank’s Ethics Committee, of being the mastermind of the petition. Interestingly, the Africa version of the newspaper, Le Monde Afrique, in a subsequent publication, put the matter in better perspective. In the piece, Michael Pauron wrote about the “Settling of Accounts at the African Development Bank”. The article reveals that the break-away faction of the aggrieved staff, wrote a complaint against the American Executive Director, one Steven Dowd, alerting that his ultimate intent, was to prevent Adesina from commencing a second term as President of the AfDB.
In a subsequent investigative piece, Le Monde Afrique attempted what it called a “Portrait of the Trump loyal destabilizing the AfDB.” It referred to a meeting held in Washington DC on the 21st of October, 2019. According to the paper, Dowd at that meeting, actively peddled anti-AFDB sentiments before officials of the United States, accusing the Bank of pro-China inclinations.
Without prejudice to the allegations contained in the whistleblowers’ petition, recent happenings have indicated a pattern of personalized animosity on the part of Dowd against Adesina and the Bank.
While it is tempting for a casual onlooker to conclude that the American Director’s disposition reflects the sentiments of his government, a keen eye will notice that the Trump administration has been a major supporter of Adesina’s remarkable term at the helm of the AfDB.
For instance, despite Dowd’s initial reservations, the Trump administration strongly supported the AfDB’s General Capital Increase and the drive to replenish the African Development Fund. When the Bank sought to float the Affirmative Finance Action for Women in Africa (AFAWA), the United States did not just support it, but sent Ivanka Trump to represent the USA at the flag-off and register a strong endorsement of the effort.
Further evidence of the Trump administration’s positive outlook towards the Bank’s efforts to advance Africa’s development is the fact that the American government sent a strong delegation with an equally strong supportive message to last year’s Africa Investment Forum. Head of the delegation, Adam Boehler, who is the first CEO of the US International Development Finance Corporation, gave rousing support for AfDB’s private sector-led investments in the region.
Unfortunately, from the revelations now coming to the fore, it would appear that Dowd’s desperation only intensified and culminated in the recent attacks on the integrity of the AfDB and its President.
Le Monde Africa reports that Dowd admitted to circulating an email beyond the purview of the Ethical Committee of the Bank, thereby violating prohibitions binding on him as a member of the Committee. The report also indicates, quoting a source, that the Executive Director admitted to passing the initial petition on to the United States Treasury Department, ahead of the Ethics Committee investigation.
A MAN GUILTY AS CHARGED
Steven Dowd is a businessman appointed to the AfDB’s Board by David Malpass, his personal friend and current World Bank President. They both attended the same school and were “best man” at each other’s wedding. In February 2019, Malpass accused the AfDB, alongside other development banks, of worsening the debt situation in their regions by lending too quickly. In the case of the AfDB, Malpass singled out Nigeria and South Africa as instances where the Bank lends rather impulsively and called on it to coordinate its lending with other financial institutions. In his concluding advice, Malpass pointed to the need for the institutions to “maintain high standards of transparency.”
Properly discerning the debilitating potential of the World Bank President’s remarks, the AfDB responded, calling the statement “misleading” and “inaccurate,” adding that it questions its integrity. It then went on to point to an obvious hypocrisy on the part of the World Bank, whose comparative exposure to Africa as at 2018, was $20.2 billion, double that of the AfDB standing at $10.1 billion. The AfDB put the matter to bed by underscoring that the World Bank’s outstanding loans to Nigeria and South Africa in the 2018 fiscal year stood at $8.3 billion and $2.4 billion, respectively. This is in comparison to the African Development Bank Group lending exposure to Nigeria and South Africa of $2.1 billion and $2.0 billion, respectively, during the same fiscal year.
Going by Malpass’s logic, the World Bank was more “culpable” of what it was accusing the AfDB of. In spite of the pointed barbs from the World Bank president, many have noticed the fact that Africa is beginning to take responsibility for its own progress and is re-priortitizing its development agenda. All 55 African Heads of State and Governments as well as critical non-regional members of the Bank have applauded the achievements of the Bank in the last five years on several occasions
In the midst of the maelstrom, Adesina has said, “I will stay calm and resolute. I will not be distracted.” From all indications, the Bank President will not relent in his quest to deliver critically needed development for Africa.
With his staff, he has designed a financial framework to support Africa’s fight against the novel Coronavirus pandemic. The Bank recently launched a $3 billion “Fight COVID-19 Social Bond” on the international capital market. With an interest rate of 0.75 percent, the effort raised the amount sought within a few hours of its launch. This bond, now listed on the London Stock Exchange, is the largest US Dollar denominated social bond in the world’s history and stands as a reminder of the success story that the AfDB has become in leading a re-born Africa that seeks innovative ways to fix her own problems.
For the records, if the charges against Adesina could be amended to read: “That you, Akinwumi Ayodeji Adesina, have relentlessly pursued the goal of obtaining a better life for the teeming masses of Africa,” then the jury would have no other recourse than to pass the following verdict – “Guilty as charged!”