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To tackle financial crime, Kenya is withdrawing its old 1,000 shilling version1 minute read

The central bank governor has not given more details on the illicit flows.

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kenyan shilling
Governor of the Central Bank of Kenya, Patrick Njoroge

Kenya plans to withdraw an old version of its 1,000 shilling banknote to tackle illicit financial flows and counterfeiting, its central bank governor said on Saturday.

President Uhuru Kenyatta promised to stamp out graft when he was first elected in 2013, but critics say he has been slow to pursue top officials and there have been few high profile convictions since he took office.

Patrick Njoroge said while launching new bank notes of other denominations that older versions of smaller denominations will remain in circulation alongside the new ones, but after Oct. 1, the older 1,000 shilling note would be invalid.

“We have assessed the grave concern that our large banknotes, particularly the older one thousand shillings series, are being used for illicit financial flows in Kenya and also other countries in the region,” Njoroge said.

Speaking while launching the notes during a national holiday celebration, Njoroge gave no more detail on the illicit flows.

The central bank’s move comes as Kenyan lawmakers push for the implementation of amendments to banking laws that would relax the country’s rigorous requirements for recording transactions above $10,000.

The central bank has said these changes could undermine efforts to tackle money laundering, financing of terrorism and proceeds from crime.

Dozens of Kenyan government officials and business people have appeared in court since May 2018 on charges relating to the alleged theft of hundreds of millions of shillings from public coffers.

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Board of Governors agree to independent probe of AfDB President, Adesina

The ethics committee of the continental bank, headed by Takuji Yano, had in its report last month cleared Adesina of all sixteen counts saying he was was not guilty of all the charges but the United States remained unconvinced.

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President of the African Development Bank (AfDB), Akinwumi Adesina in an undated photo.

After weeks of review and consultation, the Bureau of Board of Governors of the African Development Bank Group has bowed to US pressure and approved an independent investigation of the allegations against the President of the Bank, Akinwumi Adesina.

“Based on the views of some Governors on the matter and the need to carry every Governor along in resolving it, the Bureau agrees to authorize an Independent Review of the Report of the Ethics Committee of the Boards of Directors relative to the allegations considered by the Ethics Committee and the submissions made by the President of the Bank Group thereto in the interest of due process”, a communique from the Board of Governors said Thursday.

The decision, taken at the meeting of the Bureau on Thursday regarding the whistle-blowers’ complaints against Adesina, is in deference to the demand by the U.S. government that a fresh and in-depth investigation be conducted into the allegations against Adesina using an independent investigator, Premium Times, a Nigerian daily reported having access to the resolution on Friday.

On May 5, the ethics committee of the continental bank, headed by Takuji Yano, said in its report that Adesina was not guilty on all counts.

Yano is a Japanese executive director charged with the responsibility of investigating allegations by some concerned employees against the Bank’s president.

The committee described the allegations that Adesina violated the code of conduct of the institution as “spurious and unfounded”.

Regardless, the United States government expressed “deep reservations about the integrity of the committee’s process” and called for a fresh “in-depth investigation of the allegations.”

– Why fresh probe is required –

At the end of its meeting Thursday, the Bureau of Board of Governors issued a communique, agreeing with the U.S and authorizing an independent review of the ethic committee’s report.

The communique, signed by the Chairperson of the Bureau of the Boards of Governors, Niale Kaba, reads,

“The Bureau reiterates that it agrees that the Ethics Committee of the Boards of
Directors performed its role on this matter in accordance with the applicable rule under Resolution B/BG/2008/11 of the Board of Governors.

“The Bureau also reiterates that the Chairperson of the Bureau of the Board of
Governors performed her role in accepting the findings of the Ethics Committee in accordance with the said Resolution.

“However, based on the views of some Governors on the matter and the need to carry every Governor along in resolving it, the Bureau agrees to authorize an Independent Review of the Report of the Ethics Committee of the Boards of Directors relative to the allegations considered by the Ethics Committee and the submissions made by the President of the Bank Group thereto in the interest of due process.

“The Independent Review shall be conducted by a neutral high calibre individual with unquestionable experience, high international reputation and integrity within a short time period of not more than two to four weeks maximum, taking the Bank Group’s electoral calendar into account.

“The Bureau agrees that, within a three to six month period and following the independent review of the Ethics Committee Report, an independent comprehensive review of the implementation of the Bank Group’s Whistle-Blowing and Complaints Handling Policy should be conducted with a view to ensuring that the Policy is properly implemented, and revising it where necessary, to avoid situations of this nature in the future.”

The AfDB President is yet to react to the latest decisions by the Board of Governors. But he has repeatedly denied wrongdoing.

On a visit to President Muhammadu Buhari on Tuesday, Mr Adesina, a former Nigerian Minister for Agriculture, said the 16 allegations raised against him were trumped up, “and without facts, evidence, and documents, as required by the rules and regulations of the bank.”

He added that the Ethics Committee of the bank cleared him of all the allegations, and that calls for a fresh investigation by the United States of America, were against the rules.

“My defence ran into 250 pages, and not a single line was faulted or questioned,” he said.

“The law says that report of the Ethics Committee should be transmitted to the Chairman of Governors of the bank. It was done, and the governors upheld the recommendations.

“That was the end of the matter, according to the rules. It was only if I was culpable that a fresh investigation could be launched.

“I was exonerated, and any other investigation would amount to bending the rules of the bank, to arrive at a predetermined conclusion.”

While stressing that the motive was to soil his name, and that of the bank, the AfDB President said he was proud to be Nigerian, and thanked President Buhari for his unflinching support.

Nigeria is the largest shareholder of the African Development Bank with 9.1 percent shares.

– Allegations against Adesina –

In its petition, the concerned staff accused Mr Adesina of 20 breaches of the bank’s code of conduct, including “unethical conduct, private gain, an impediment to efficiency, preferential treatment, and involvement in political activities.”

The group, which noted their allegations were in line with AfDB’s whistle-blowing policy, said these activities adversely affected the confidence and integrity of the bank.

Nigeria, Adesina’s home country, had last week countered the US by insisting that such a request for an independent investigation could not be granted by the Board of Governors as AfDB’s corporate governance code contains no such provision for an external “independent outside investigator”.

Nigerian authorities then began lobbying for Adesina after receiving satisfactory intelligence briefing that the AfDB president was the victim of a witch-hunt by the Americans.

“The call for an independent investigation of the president is outside of the laid down rules, procedures and governing system of the bank and its articles as it relates to the code of conduct on ethics for the president,” Zainab Ahmed, Nigeria’s Finance minister wrote in a letter to AfDB’s Board of Governors where it denounced the plans to circumvent the bank’s internal procedures.

Ahmed asked the AfDB to “uphold the rule of law and respect the governance systems of the bank” and if there was need for improvement, it should be done according to laid down procedure. She then highlighted all Adesina’s projects and achievements which she noted did not warrant such an attack on his career.

Former Nigerian President Olusegun Obasanjo, in a letter to former African presidents also canvassed support for Adesina, saying he had taken the bank to a great height since he took the position in the last five years.

Adesina, “has actively positioned (AfDB) as an effective global institution ranked fourth globally in terms of transparency among 45 multilateral and bilateral institutions,” Obasanjo wrote to 13 former heads of state including Thabo Mbeki of South Africa, Hailemariam Desalegn of Ethiopia and Ellen Sirleaf-Johnson of Liberia.

The U.S. became a member of the African Development Fund in 1976 and of the African Development Bank in 1983. Also, its bilateral cooperation with the bank has been strengthened through cooperation agreements.

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Heavy rains threaten Uganda’s coffee crop quality

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Uganda’s coffee crop quality could see a decline in the coming months as heavy rains across the country have reduced the amount of sunshine necessary for bean drying.

Uganda is Africa’s largest exporter of coffee followed by Ethiopia and grows mostly robusta variety.

The country has been pounded by unusually heavy rains that started in August resulting in deaths, displacement and extensive damage to roads and other infrastructure.

Western Uganda, including the foothills of the Rwenzori mountains , some of the biggest coffee growing areas, has received some of the most intense rains.

Uganda Coffee Development Authority (UCDA), the state-run regulator, forecasts Uganda’s bean exports will climb 16 percent to 5.1 million 60-kg (132-pound) bags in the current crop year ending September.

The country’s coffee output has surged in recent years, the fruition of a government programme that has been distributing free seedlings to farmers to expand acreage and replace aging trees.

Authorities say their target is to help boost annual production to 20 million bags by 2025.

The beans have traditionally been Uganda’s biggest commodity export but were recently overtaken by gold which now annually earns the country over $1 billion.

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Business rescue team rule out mid-June return for SAA flights

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South African Airways business rescue practitioners have rejected an “unvetted” statement released by the state-owned airline indicating plans to resume domestic flights from mid-June.

The national carrier had on Tuesday, announced that its planes will be back in the skies between Johannesburg and Cape Town.

But Les Matuson and Siviwe Dongwana, the business rescue administrators, say the airline had breached communications protocol by issuing a statement which “created an unfair expectation on our relevant stakeholders, including SAA’s customers, as well as employees who are on unpaid absence as a result of the travel ban which led to the halting of the company’s operations, compounding its financial distress.”

SAA’s media statement had gone out without the approval of the practitioners as demanded by the business rescue procedure.

With the government of South Africa announcing that the country will enter into lockdown alert level 3 from June 1, domestic air travel will be permitted but only for business purposes.

The business rescue practitioners said SAA planes will remain grounded until a better understanding of what the level 3 regulations entail.

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