The brewing crisis of succession at the African Development Bank (AfDB) calls for serious concern. It has thus deservedly elicited a series of comments across the continent and even beyond.
The bank, which is the outcome of Pan-African diplomacy in the earlier years of political independence from colonialism, was structured to be an engine of economic development on the continent, following from an agreement of August 1963 by the founding fathers, which came into effect in September 1964, leading to an inaugural Assembly in November 1964 in Lagos, Nigeria.
According to Article 1 of the Agreement establishing the AfDB, its mandate consists of “contributing to the economic development and social progress of its regional members, individually and jointly,” through loans, equity investment and technical assistance.
The bank has a shareholding made up of 54 African (regional member) countries and 27 non-African (non-regional) countries. Basically, the AfDB is thus an African bank. Nigeria, a regional member is the overall largest shareholder and the United States of America, the largest shareholder among the non-regional members.
“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-“– Daniel F Runde, senior vice-president at the Center for Strategic and International Studies
The current crisis of succession in the bank appears to be a battle for the soul of Africa given the increasing influence of China on the continent with the U.S. appearing to use the crisis to re-launch itself on the continent.
This appears plausible given that the current U.S. administration is evidently not well disposed to multilateralism in the global financial architecture. This is indeed worrisome given the disruptive role the U.S. has been playing globally in recent times particularly with its withdrawal from the Paris Climate Change agreement, its unhealthy intervention in the World Trade Organisation, which led to the Director-General resigning his position, the current imbroglio at the World Health Organisation and repeal of the North America Free Trade Agreement and withdrawal from the Trans-Pacific Partnership Agreement in recent times.
“At this critical time that Africa is battling with Covid-19, the Bank and its President should not be distracted,” Obasanjo argued in a letter that was also signed by Jakaya Kikwete, Goodluck Jonathan, Joachim Chissano, Ellen-Johnson Sirleaf, Joyce Banda, Tandja Mamadou and several other leaders
The suspicion of the motive behind the U.S.’s role in the AfDB saga is being fueled by its setting up of the Development Finance Corporation in 2019 with a $60 billion capitalisation to, in conjunction with its control of the World Bank re-launch itself on the continent to checkmate the influence of China in Africa.
These speculations are fueled by the U.S. recent antecedents in this regard.
Could the instigation of a crisis in the AfDB be the trigger the U.S. needs to set up an alternative financing mechanism for Africa under its firm control? This is a question begging for an answer.
Dr. Akinwumi Adesina is reputed to have performed creditably in his first term as President of the African Development Bank. This has not been faulted, even by the United States of America.
The seeming bone of contention is that he is largely perceived by the West as being un-apologetically Pan-African and a second term in office could affect some vested interests on the continent. Under Adesina’s Presidency, the bank increased its capitalisation from $93 billion to $208 billion, a move considered unprecedented in its history.
By this move, the AfDB can reasonably intervene in economic development projects across the continent comparable to what the Asian Development Bank and the Inter-American Bank are doing in their delivery of credit to Asia and Latin American countries respectively.
Under Adesina, the African Investment Forum was formed in 2018, which attracted over $80 billion infrastructure investment interests into Africa, to the dismay of the U.S. which felt that this was a deviation from the core mandate of the bank, contrary to the view of many who see AfDB role on the continent as broad and development-focused.