Sidi, thanks for bringing the AfDB policy for the prevention and control of corruption to our attention.  As you know, all the global finance institutions have similar policies, yet, we see that corruption is still alive and very improved in most of the poor nations these institutions service.  The question then is, how effective are these policies and how does the AfDC measure the effectiveness of their policy?  Thanks in advance for your thoughts in this inquiry.

Chi Jaama

Joe Sambou 

>From: Sidi Sanneh <[log in to unmask]>
>Reply-To: The Gambia and related-issues mailing list <[log in to unmask]>
>To: [log in to unmask]
>Subject: Prevention and Control of Corruption in AfDB-financed Operations
>Date: Thu, 7 Jun 2001 11:06:27 -0500
>
>Several of you, particularly Messrs Dampha and Touray, have raised the
>issue of corruption in your reaction to the $500,000 grant from the AfDB to
>The Gambia to help alleviate the suffering recently experienced by rural
>population in NBD, CRD and URD. Mr. Dampha and others wondered what the
>AfDB is doing or can do to ensure that the resources provided are utilised
>solely for the purposes for which they were intended. Please find below
>excerpts of AfDB policy on corruption/good governance applicable to all
>RMCs, which, I hope, will partially answer some of your concerns, and help
>allay fears:
>
>“…the Agreement establishing the African Development Bank, requires…that
>proceeds of any loan made or guaranteed by it are used ONLY (emphasis mine)
>for the purposes for which the loan was granted, with due attention to
>considerations of economy and efficiency. The spirit of this requirement
>broadly guided the rules of procedure for the procurement of goods and
>services laid down by the Bank in 1980. These rules and procedures were
>significantly revised in 1996 and 1999. It is now possible for the Bank to
>cancel part of or an entire loan or grant if the procurement procedure is
>tainted by acts of fraud or corruption. Similarly, the Bank may SANCTION
>(again, emphasis mine) a firm found guilty of fraud or corruption following
>a special audit or judiciary decision.”
>
>“ At the internal level, the Bank has earmarked resources, prepared
>documentation and perfected procedures to ensure that the procurement
>process is as transparent as possible, and enables a close monitoring in
>which contracts financed with bank loan and grant resources are awarded.
>Through the establishment of the Procurement Review Committee, the Bank can
>at all times, receive and examine complaints by bidders who are not
>satisfied with the way in which their bids were processed by borrowers or
>executing agencies. This Committee is INDEPENDENT and its decisions, which
>can even lead to cancellation of the PROCUREMENT PROCESS or the financing,
>are FINAL.”
>
>“The Bank will remain alert to changes in international procurement
>practices and adopt its own rules accordingly. It will maintain permanent
>dialogue with other international financial institutions and all
>governmental and non-governmental organizations working towards greater
>transparency in procurement. It will also strengthen its role in
>monitoring and ensuring effective use of the resources provided to member
>countries, while remaining open to complaints from bidders, and organizing
>reviews of current contract award procedures.”
>
>The AfDB has cancelled several loan proceeds since the first review of the
>policy in 1996 and several more after the second review in 1999 in member
>countries due to corrupt practices and/or mis-procurement. In the case of
>the Gambia, the AfDB has never had the cause to revert to loan cancellation
>due to either corruption and/or mis-procurement. However, the AfDB has had
>to, on at least one occasion that I am aware of, cancel the PROCUREMENT
>PROCESS and ordered the executing agency to re-start the entire procurement
>process to the satisfaction of the Bank. The AfDB’s policy recognises that
>the elements of good governance (creation of an enabling regulatory
>framework and economic environment for genuine participation by members of
>society, generation of legitimate demands and monitor government policies
>and actions, framing of unambiguous laws that are uniformly applied through
>an objective and independent judiciary etc., etc.) are complex concepts.
>It recognises also that there are two distinct but closely related
>dimensions: one is political and relates to genuine commitment to achieving
>good governance; and the other technical, and relates to issues of
>efficiency and public management. Both of these must be addressed
>sincerely to create a truly enabling environment where both public- and
>private- sector operations can flourish and poverty reduced. (The language
>employed in the final paragraph is a paraphrase of the AfDB Policy on Good
>Governance, which I do not claim to be my own.)
>
>NOTE: The Information Disclosure Policy of the AfDB empowers the Public
>Information Centre of the Bank to serve the public of Member States through
>the Communications Unit (COMU) of the Bank Group. Information not for
>restricted circulation can be obtained through COMU.
>
>Sidi Sanneh
>
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