The African Development Bank’s board agreed to an independent probe of its president, Akinwumi Adesina, after the U.S. rejected an internal investigation that cleared him of allegations of favoritism.

Africa’s largest multilateral lender decided on the inquiry after several governments backed U.S. 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.

Adesina, who has repeatedly denied wrongdoing, may have to step back from the role until the probe is completed, they said.

If there are questions from major shareholders on the appropriateness of an internal process, clearly it’s not harmful if that is put into a different light and looked at from the outside world with fresh eyes. We don’t necessarily require such or we don’t advocate for such.

Allegations

Unidentified whistleblowers accused Adesina, 60, of handing contracts to acquaintances and appointing relatives to strategic positions. The Abidjan-based lender declined to comment. Adesina didn’t respond to an emailed request seeking comment, while a call to his mobile phone didn’t connect.

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. The AAA-rated lender’s 80 shareholders in October pledged to provide funding that will 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 Mnuchin’s demands for professional outsiders to look into the allegations, the people said. A representative for the Nordics declined to comment.

US unhappy with exoneration

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 U.S. is the AfDB’s biggest shareholder after Adesina’s home country of Nigeria. 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.

“If there are questions from major shareholders on the appropriateness of an internal process, clearly it’s not harmful if that is put into a different light and looked at from the outside world with fresh eyes,” S&P analyst Alexander Ekbom said before the decision of the probe was taken. “We don’t necessarily require such or we don’t advocate for such.”

Support from within

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 to help secure funds for Africa to deal with the fallout from the disease.

U.S. 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, the lender issued a $3 billion social bond to help African countries deal with the fallout from the coronavirus pandemic. The bank also launched a $10 billion crisis-response facility for African nations.

Source: Agencies

The much-awaited bill ratifying the end of the CFA franc was adopted on Wednesday by the French Council of Ministers. This was disclosed by the spokeswoman for the French government, Sibeth Ndiaye.

“It was during an official visit to Ivory Coast in December 2019 that they (President Macron and French West African leaders) announced a historic reform of monetary cooperation that was to lead to the end of the CFA franc.

“As the President of the Republic had been able to stress, this symbolic end was to be part of a renewal of the relationship between France and African countries,” she said.

The text validates the transition of the CFA franc – used by eight French West African countries – to become the newly mooted Eco, a currency to be adopted by the entire West African bloc, ECOWAS.

It also marks the end of the centralization of foreign exchange reserves of the eight West African states with the French Treasury.

In concrete terms, the Central Bank of West African States will no longer have to deposit half of its foreign exchange reserves with the Bank of France. France will also have to withdraw its presence from the governance bodies.

The fixed parity of the future Eco currency with the euro will have to be maintained. Eight countries concerned are: Benin, Burkina Faso, Côte d’Ivoire, Guinea-Bissau, Mali, Niger, Senegal and Togo.

Critics of the CFA franc perceive it as one of the last vestiges of France’s colonial domination. The Central African version of the currency, XAF, however; continues to be used in six countries across the region.

About the twin CFAs

The CFA franc, its initials come from the French words for African Financial Community, was launched on December 26, 1945 as a “franc of the French colonies of Africa.”

Fourteen nations, divided into West and Central African groups, use the currency today. Their 155 million people account for 14 percent of Africa’s population and 12 percent of its GDP, according to the International Monetary Fund (IMF).

Two different CFA Franc users. Eight countries comprise the West African Monetary Union (WAMU), Benin, Burkina Faso, Ivory Coast, Guinea-Bissau, Mali, Niger, Senegal and Togo. Its Dakar-based issuing authority is the Central Bank of the West African States (CBWAS).

Six others are in the Central African Economic and Monetary Union (CAEMU): Cameroon, the Central African Republic, Chad, Equatorial Guinea, Gabon and Republic of Congo. Its issuing authority is the Cameroon-based Bank of the Central African States (BCAS).

Culled from Africa News

President Paul Biya has approved the execution of Air-France’s commercial flights from May 4 to June 30, 2020. This notice was sent to the Director-General of the Civil Aviation Authority in a letter sent by the Minister of Transport Jean Ernest Massena Ngalle Bibehe.

According to the letter, the flights will be executed alternatively, weekly, at the international airports of Yaounde-Nsimalen and Douala.

This agreement is however subjected to the observation of some key conditions. “Passengers on these flights will have to present a negative coronavirus screening test when boarding, and commit to self-confine at their expenses upon arrival in Cameroon,” the Minister of Transport wrote.

“Arrangements will have to be made for their monitoring in our country. The mandatory wearing of masks and compliance with barrier measures will also be imperative for these passengers and Air-France staff,” he added.

Last March, the Cameroonian government revealed that the first cases of coronavirus in the country were imported. Most of those infected had landed from Air-France’s commercial flights. Following this importation of the pandemic, Cameroon had decided to close all its borders.

With the confirmation that the President of the Republic has given his approval for the resumption of commercial flights of the French airline to Cameroon, are we moving towards the reopening of the country’s borders?

An Air France flight that landed on Tuesday, March 17, 2020 in Douala, Cameroon’s economic capital, was at the center of heated debates at the Douala International Airport because of its contaminated human contents.

The flight raised fear in the Central African country by many notches, as Cameroonians fear that their fellow Cameroonians and some Frenchmen returning to the country were bearers of the dangerous Coronavirus that has disrupted economic activity across the globe and killed thousands, especially in China where the virus started.

Written by Business in Cameroon and Cameroon Concord News

The Board of Directors of the African Development Bank Group (www.AfDB.org) has approved grants worth €40.94 million for the construction of a bridge to connect Cameroon and Chad across the Logone river.

The grants, comprising a €20.785 million tranche for Cameroon and €19.215 million for Chad, were approved on 30 April 2020. The facility is from the Investment Facility for Africa under a framework agreement between the Bank Group and the European Commission.

The funds will co-finance the costs of construction of the bridge between Yagoua in Cameroon and Bongor in Chad, access roads and feasibility studies, management said in a report to the Board.

The bridge, once completed, is expected to bolster bilateral and sub-regional integration and cross-border trade, safeguard life and property during the river crossing and boost socio-cultural ties between the two countries.

“Specifically, the project aims to promote interstate trade, particularly between Cameroon and Chad, reduce travel time and transportation costs, and improve accessibility of basic services by nearby communities,” the report noted.

In addition to the Logone river bridge, other projects under the Pillar Assessed Grant or Delegation Agreement (PAGODA) include the rehabilitation of the Lome-Cotonou road, road development and transport facilitation on the Bamako-San Pedro corridor between Mali and Côte d’Ivoire and the rehabilitation of the CU2a community road section in Burkina Faso near the border with Niger.

The Bank and the European Commission are committed to co-financing development projects that tackle poverty by investing in critical infrastructure to promote seamless connectivity of transport, energy and ICT.

French brewery cartel known as Les Brasseries du Cameroun reportedly pressured President Biya to undermine Cameroon’s Health Ministry lockdown provisions against COVID-19 exposing the government’s total ineptitude in dealing with the crisis, Cameroon Concord News Group has gathered from concordant sources in Yaoundé.

The pandemic is now sweeping across Cameroon, overwhelming hospitals, and leading to the surging death toll but the Head of State has ordered all pubs, bars and breweries to operate as usual. While in mother France, pubs are only permitted to either deliver drinks or allow customers to pick them up.

The French brewers threatened Etoudi with severe consequences if the regime failed to put an end to the lockdown. Officials at the Ministry of Public Health have blatantly refused to criticize the government for downplaying the risk of coronavirus spreading in beer parlours.

The Biya decision was put into practice without any proper consultation with Cameroonian trade bodies and civil society organizations. A cream of Cameroonian clergies have raised fingers against the move on social media with a prominent Man of God stating that “The reopening of bar is DANGEROUS. When the FLOOD subsided after 40 days, Noah did not RUSH OUT. He sent a bird out and it was after the 3rd bird did not return that he knew it was TIME to STEP OUT.  Please do not join the multitudes that are rushing out because they are tired of staying at home. A lot of people have already been infected and unknowingly will keep infecting others. Let us be wise like Noah to OBSERVE for many more days inside our own ARK, OUR HOMES before taking any action.  May we and our loved ones be preserved and protected from this pandemic in Jesus mighty name. Amen.”

By Chi Prudence Asong

Accompanying the misery of the coronavirus pandemic has been an ongoing crisis in the oil industry. While the scale and tragedy of the coronavirus is front and center in our minds, the collapse of oil is more abstract, and its long term consequences will be serious. In the United States, the oil industry is already collapsing, but oil does not play the central role in the American economy that it does elsewhere, such as the Middle East sand Russia. Especially in Africa, the collapse of oil is likely to devastate government revenue at exactly the same time the continent faces the astronomical costs of responding to the coronavirus and looming famine.

The trade war between Saudi Arabia and Russia over oil production levels, and therefore the world price of oil, destabilized markets at the very moment that the seriousness of the pandemic was starting to hit home. Now, the oil crisis is dramatically worse. For a day or so, the price of oil fell into negative territory. That is, sellers were paying buyers to take the oil off their hands, in part because they have run out of storage capacity. While there has been some slight recovery, there is a worldwide glut of oil-producing capacity. At the same time, the shutdown of much of the world’s economic activity has all but dried up demand.

It is recognized that oil is crucial to Nigeria, which usually produces 2 million barrels per day, and Angola, which produces about 1.8 million barrels. Less well known is that over the past decade other African countries have entered the oil market. So much so that oil now accounts for more than half of sub-Sahara Africa’s exports. Further, African governments are often overly dependent on oil revenue, even when their oil industry is playing a declining role in their national economies. In Nigeria, for example oil accounts for less than 10 percent of GDP, but accounts for more than 90 percent of the country’s foreign exchange and can account for as much as 70 percent of the government revenue. Yet, faced with the costs of responding to the virus and the possibility, even likelihood, of famine, African governments will desperately need revenue and foreign exchange, both of which are disappearing. Governments will need to turn to the international financial institutions and foreign governments.

Eventually, oil will stabilize and the virus will be controlled. But it is hard to see oil prices ever again achieving their former levels; as recently as 2011, oil sold on the international market for over $110 a barrel, and many African governments were flush with cash. Those days are unlikely to ever return. This may force a reckoning in how African economies develop in the future.

Source: Council on Foreign Relations

Cameroon is one of the 77 developing countries benefiting from the 12-month moratorium on foreign debt servicing decided on April 15 by the G20 during a video conference. The information was revealed the following day by the French ambassador to Cameroon Christophe Guilhou, at the end of an audience with President Paul Biya.

According to the media service of the French embassy, the moratorium (which succeeded in part thanks to French President Emmanuel Macron’s efforts) postpones the payment of bilateral debts by 12 months.

In its 2020 budget, Cameroon had set a little over XAF720 billion for the payment of its debts. Out of that amount, XAF232.2 billion was set aside for the payment of its bilateral debts for this fiscal year.

Lobbying

With this moratorium, the G20 countries aim to let beneficiaries concentrate on the health crisis at hand and worry about debt repayment later. However, since the debt is not canceled, it will just add to debt servicing in 2021. African countries must, therefore, continue to lobby for the cancelation of their debts.

“We also call for the cancelation of the debt of African countries…The IMF must be ready to respond to our countries’ increased demand for resources. The World Bank must also systematically support all countries since a specific scheme is applied for IBRD and IDA borrowers whose loans are classified as non-performing,” said Alamine Ousmane Mey at the Spring Meetings of the Bretton Woods Institutions. He was speaking as the chairman of the African Consultative Groups (ACG) of the International Monetary Fund (IMF) and World Bank Group (WBG).

According to Cameroon’s Ministry of Finance, On December 31, 2019, Cameroon’s outstanding public and publicly guaranteed debt were estimated at XAF8,424 billion, or about 37.3% of GDP. At XAF6,650 billion, the country’s external debt accounted for 77.1% of the total debt.

Culled from Business in Cameroon

An economic onslaught is staring at the face of traders in the Central African country of Cameroon, which is one of the most affected countries by the coronavirus or COVID-19 pandemic in the continent.

The country, known for its varied terrain and wildlife has so far reported 1,017 positive cases, with 22 deaths, according to data compiled by the U.S.-based John Hopkins Coronavirus Resource Centre.

“The virus has slowed down my work. I have to go out and sell few things, even though I do not earn much,” said Adams Patrice, who deals with secondhand goods. He used to have a roaring business on weekends when people on the outings throng to markets selling cheap goods.

“Everything has changed. The customers are afraid. They pass by wearing their protective masks and do not talk to us. They barely stop to look at the merchandise. There is a drought in the market,” he said.

Like Patrice, an electronic retailer Fabrice Fondjeu, has also lost most of his clientele.

“I receive less than five customers a day compared to more than 40 before the pandemic. It has dipped my savings,” he said. He is counting that the government may announce some sops to stabilize the situation.

Although governments worldwide are encouraging digital connectivity as an alternative to physical connectivity, Tamo Christian, a cyber cafe manager, has few customers. He is still relying on the government’s push for digital education, expecting that students who do not have computers and internet connection at home will use his services. He has also cut his daily expenses considerably.

The restrictions on travel have also led to a steep decline in the online sale of tickets, said Geraldine Nbebi, sales administrator of an online ticketing startup. He, however, appreciates the fact that because of social distancing, people are increasingly getting used to digital technology.

Food chain affected

Speaking to Anadolu Agency, Ebouki Lea, a food vendor, said she has been going through difficult times since restrictions on movements. She used to bring goods from villages and then sell them in cities. Regular customers have even abandoned her. Even farmers have limited production in the villages.

The secondhand goods dealer Patrice had thought of going digital, opening an online store, where he would share pictures of goods and receive orders through social networking sites. But he laments that he is on the other side of the digital divide and also does not have funds to open an e-shop.

Even as the Cameroonian government has taken measures for businesses, the fear that economic slowdown will stay for a long time to come is palpable. President Paul Biya had asked the trade ministry to ensure stability in prices and availability of consumer goods. He had also asked officials to come out with plans to regulate the flow of people in markets.

Acknowledging that it was a difficult time for traders, Minister of Trade Luc-Magloire Mbarga Atangana told a local radio station that there was no possibility of a shortage of goods. “The country should be able to rely on its national production and food reserves and count on sea shipments. The country is prepared for any eventuality,“ he said.

Source: Anadolu Agency

The OPEC Fund is contributing €30 million to support the Republic of Cameroon’s production and trade of cotton fiber.

The financing facility, which is led by the International Islamic Trade Financing Corporation (ITFC), will enable Cameroon to finance the purchase of agricultural inputs which will be processed into cotton fiber and sold into the export markets.

Cotton is an important product in Cameroon. The sector employs around 200,000 farmers, while over 2 million people benefit along the value chain.

Source: opecfund.org