NEWS
THE SUM OF CHF9.28MILLION ARE STILL OUTSTANDING-PANIC STRICKEN JAMMEH
TELLS IMF BOSS, AS PART TWO OF HIS IMF CONFESSION CONTINUES
BY ALLGAMBIAN'S NEWS RESEARCHER
AND INVESTIGATIVE JOURNALIST
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October 27, 2005
In a "confession letter to the IMF, Gambia's President Yahya Jammeh said
his government was yet to fulfil its financial obligation to the world
leading financial body IMF, which he Jammeh estimated to be in the sum of
CHF 9.28Million. Jammeh told the IMF Managing Director Mr.Horst Koshler,
that the said outstanding sum was yet to be settled by his administration.
In response to Jammeh's pleas and cover up moves, the IMF Managing
Director in a letter retorted"Our understanding is that some CHF 11
Million was still outstanding from the foreign exchange reserves at the
end of September 2003 as a result of the latter problem."
The ALLGAMBIAN online Newspaper news researcher and investigative
journalist said Jammeh at one point blames donors for not coming into the
country's aid, during the the decade long economic crisis under his rule.
Jammeh justified the unprogrammed project expenditure and insists that
such moves does not in any way means that he and his government were bent
on misusing public revenues.
Our correspondent says the reason behind Jammeh's much talked about
"Operation No Compromise" was compelled by a pressure he Jammeh received
from the IMF who insisted that the government must clean the economic mess
they perpetrated at the nation's central Bank. The IMF President in a
letter, insisted that some of the old guards at the CBG must go, which
Jammeh later scummed to. He fired Lang Conteh, Kapu Cham, Momodou Ceesay
and Clark Bayo, all former senior managers of the central bank.
Now the secret behind the so called "Operation No Compromise" has been
exposed by our investigative correspondent, who will be spilling the beans
in the days and weeks to come. Below is the unedited version of Jammeh's
"confession letter" to the IMF Managing Director. The ALLGAMBIAN, your
leading and most reliable source of news. Please read on......
The Gambia will take the actions required under the laws of The Gambia, in
relation to this issue. Since 2003, some of the Swiss Francs have been
recorded. The balance outstanding now stands at CHF 9.28Million. In order
to address concerns about the quality of the previous audits of Central
Bank of The Gambia, I am willing to give audience to an IMF Delegation to
Banjul to discuss: (A) The possible change of auditors for CBG, (B) The
possible re-audit of the CBG for financial years 2001 and 2002, including
a separate and independent examination of the CBG external reserves. The
re audit and the examination of the CBG reserves will be done on the basis
of terms and reference acceptable to The Gambia. I will communicate,
through the Secretary of State for finance and Economic Affairs, the exact
date for the audience in Banjul.
I look forward to a quick resolution of the issues mentioned in your
letter and continuation of the relationship between The Gambia and the
IMF. This is crucial to the efforts of the government of The Gambia to
reduce poverty and maintain security. The Gambian authorities will work
with the IMF to ensure that the relationship remains strong and positive
Other expenditures is related to our efforts to improve agricultural
production in The Gambia. The improvement and maintenance of road
infrastructure and agriculture are high on my agenda. The urgency of the
situation and the commitment of my government to improve the living
conditions of all Gambians is indeed a difficult task especially given the
paucity of the National resources and the almost nonexistent donor
support. In fact, the reason why my government resorted to this bridge
financing from CBG was in anticipation of earlier expressed donor quarter
that never materialised.
In addition, we have been deeply concerned at the deteriorating security
environment in the region and the threat of global terrorism. Therefore,
the government of The Gambia has taken steps to safeguard national
security and our democratic system. This notwithstanding, the issues you
raised were critically looked at especially with regards to their
implications on governance.
I take this opportunity to assure the IMF of the government of The
Gambia's absolute commitment to transparency and accountability. The
manner in which some transactions were recorded may not have strictly
conformed to acceptable financial reporting frameworks. However, this does
not imply that public funds were misused.
The operational details relating to the correct path of foreign exchange
reserves over the relevant period will be provided by the CBG within the
framework of the audited financial statements. I take this opportunity to
thank you and your colleagues for the reception you accorded me during my
visit to Washington in June this year. Under the circumstances, I wish to
reassure the IMF of my government's continued commitment to sound economic
policies. The government of The Gambia looks forward to continued close
cooperation with the IMF to improve the living standard of The Gambian
people.
In another developments, ALLGAMBIAN leading news researcher and
investigative journalist was also able to lay his hands on the letter of
Mr.Horst Koshler, Managing Director of the International Monetary Fund
IMF, which was sent to President Jammeh. Mr.Koshler in no uncertain terms,
expressed concerns raised by the IMF with regards to inaccurate and
misleading financial facts and figures given to the firm by The Gambian
government. In a frank and candid statement, Mr.Koshler asked Jammeh's
government to initiate strict financial discipline to avoid having
problems with IMF. This includes, the restructuring of what many termed as
the rotten Central Bank set up. Below is the full text of Mr.Koshler's
letter to Jammeh. Please read on.....
Dear Mr.President,
Thank you for your letter of October 28, 2003. I appreciate the
information you have provided on the unprogrammed expenditure by the
government, which was forwarded by the Central Bank of The Gambia. I note
also the assurances that these expenditures have now been fully and
correctly recorded in the accounts of the CBG. In addition, the CBG has
provided IMF staff with revised aggregate figures for foreign exchange
reserves for the past three years.
We have also take note of the recently announced changes in the management
of the CBG. There remain, however two important issues outstanding from my
earlier letter, and we need to consider implications of the information
already provided.
The first issue relates directly to the serious failures of internal
control over the CBG'S foreign exchange operations. This seems to have led
both to substantial losses on foreign exchange transactions in recent
years and to the non delivery by foreign exchange bureaus of currency
purchased by the government. Our understanding is that some CHF 11 Million
was still outstanding from the foreign exchange reserves at the end of
September 2003 as a result of the latter problem. An IMF safeguard mission
recently visited Banjul and evaluated the CBG'S internal controls. Two of
the mission's initial principal recommendations are the replacement of the
CBG'S current external auditors, who has served in that capacity for 32
years, with an international firm with expertise and experience in control
banking operations, and a re-audit of financial years 2001 and 2002.
The safeguard assessment once completed will propose additional measures
to help ensure the proper functioning of the central bank's internal
controls and reporting mechanisms and to give assurances to the IMF that
its disbursements are adequately safeguarded.
The second issue is the need to undertake a special audit of foreign
exchange activity at CBG since 2000. This will be a crucial step in
establishing comprehensive information on the timing and amounts of
unprogrammed government expenditure referred to the above and the
associated adjustments in the central government accounts as well as the
path of foreign exchange reserves over the period. The understanding of
such an audit under agreed terms of reference is I believe, essential in
order for IMF to continue it close and productive relationship with the
Gambia.
I am writing separately to the Secretary of State for Finance and Economic
Affairs about the procedures that need to be set in motion to determine
whether noncomplying disbursements from The IMF were made during the last
PRGF supported program and the measures that may need to be taken as a
result.
I look forward to receiving the full cooperation of the authorities so
that we can address these issues satisfactorily and as rapidly as
possible.
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