The Economist May 21st 2022 43
Middle East & Africa
TheAfricanDevelopmentBank
Too important to fail
I
n the middleof July 2020, Roland Mi
chelitsch slipped out of his home in Ivo
ry Coast, taking almost nothing with him.
He quietly got into an armoured Land Rov
er and drove to a boatyard where he aban
doned the vehicle. And then he disap
peared. Mr Michelitsch was not a spy or
criminal mastermind. He was a banker of
the least glamorous sort—the independent
evaluator general of the African Develop
ment Bank (afdb). Yet he had fled the coun
try fearing for his life.
The afdbis the most important African
development institution in a region with
about 70% of the world’s extremely poor
people. The World Bank is far larger, but
the afdb, with its headquarters in Abidjan,
the commercial capital of Ivory Coast, fo
cuses exclusively on the continent. It has a
strong record of spending on things that
African governments prioritise. It has as
sets of about $60bn and before covid19
committed about $10bn a year in lending,
much of it in line with the ambitious goals
set by Akinwumi Adesina, its president
since 2015. Because of its focus, rich coun
tries have given billions to its concessional
fund for the poorest countries. They also,
in effect, lend their topnotch credit rat
ings to the bank, which allows it to borrow
cheaply and lend at low rates. At its annual
meetings next week, the bank’s governors
and board are expected to discuss plans to
ask donors for as much as $24bn.
This makes it all the more important
that the afdbis run well. Yet a number of
incidents over the past two years raise
troubling questions about how it is man
aged and whether its internal watchdogs
have sufficient oversight of the afdb’s ex
ecutives. Importantly, they also throw into
question whether the bank retains the full
confidence of the creditors, donors and
shareholders who fund it and whose sup
port it needs to prevent African economies
from being dragged down by mounting
debt, surging international food and ener
gy prices and the lingering effects of the
pandemic. The bank says it is well man
aged, is able to raise funds and is com
mended by its African members.
Mr Michelitsch’s departure is one of
these worrisome incidents. The evaluator
general’s office assesses whether the bil
lions the bank commits are helping poor
people. It is bound to report if bank pro
jects are failing. To safeguard its indepen
dence, the evaluator reports directly to the
board of directorsand is supposed to be
free from management influence. Yet
these safeguards appear to have failed in
the case of Mr Michelitsch, who had been
appointed just ten months earlier after a
long career at the World Bank Group.
The events leading to his flight began
with a seemingly trivial disagreement over
the bank’s policy that staff had to remain in
Abidjan, even while working from home
during the pandemic. Mr Michelitsch, who
strongly disagreed with this, told his team
that he would be flexible in cases of hard
ship or maternity leave. Days later Mr Ade
sina wrote to the board accusing Mr Miche
litsch of “gross misconduct and aggravated
disregard, and disrespect for the authority
and person of the President” and said that
DAKAR
Several incidents raise troubling questions for creditors and donors about Africa’s
most crucial bank
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