Nigeria, 15 African Countries Back IMF Chief, Call for Fair Investigation

Emmanuel Addeh in Abuja

Nigeria along with 15 other African nations have lauded the Managing Director of the International Monetary Fund (IMF), Kristalina Georgieva, calling for a fair investigation into her activities while at the World Bank.

Georgieva was recently accused of improperly pressuring subordinates while at the Bank to adjust a ranking in China’s favour in the “Doing Business” 2018 report to boost the Asian country’s business climate rating.

The IMF leader had rejected the allegations and the report once used by investors and often touted by governments as a gauge of competitiveness, has been discontinued.

But a statement by a group of African finance ministers, including Nigeria, Egypt, and Ethiopia, published on the website of the Senegal’s Finance Ministry, noted that the IMF chief remains a true partner to the nations on the continent.

Other signatories to the statement included Benin, Botswana, Burkina Faso, Côte d’Ivoire, Democratic Republic of the Congo, Djibouti, Ghana, Guinea Bissau, Mauritania, Senegal, Somalia, Sudan, Tanzania and Togo.

However, describing the allegation as “serious”, the African countries said it must not be allowed to undermine the good work being done at the multilateral institution.

“The allegations made by a law firm in a probe last month are serious and should be investigated. However, we also believe this should be done in a manner that doesn’t undermine the integrity of the IMF and most of all, must allow for a fair and just process,” they stated.

Under Georgieva’s leadership, the IMF, the ministers noted, allocated about $30 billion in reserve assets known as special drawing rights to African economies, and urged wealthy states to direct some of their allocation to countries lacking the means to cope with the Covid-19 crisis.

Describing her as having demonstrated integrity, energy and progressive advice, the ministers noted that Georgieva has also supported African governments in exploring ways to extend their debt maturity including relief for the poorest nations.

While countries like Hungary stepped up support, the top IMF official, a report by Bloomberg stated, got a cold shoulder in Washington in the wake of the scandal, with the U.S. Treasury Secretary Janet Yellen declining to return Georgieva’s calls.

“The IMF’s leadership has been an important element in the response to the COVID-19 crisis. We can confidently say that she has brought a human touch to development and to the organisations she leads,” the African ministers wrote.

As finance and economy ministers of Africa, the signatories noted that multilateralism was more than just an abstract foreign policy issue, but about achieving prosperity for millions of their citizens.

“Our countries have been and are currently facing formidable economic, social, and political pressures – many of which are the result of external shocks. That is why, while adopting national mitigation measures, we also rely on multilateral institutions to propose collective life and livelihoods economic relief.

“Today, multilateralism is in question at a time when it is most needed. While the advanced economies were able to rapidly put in place monetary and fiscal buffers to respond to the Covid-19 crisis, commanding over 26 percent of their GDP to fight an impending recession, African countries have been able to mobilise less than 1 percent of GDP to respond to the crisis.

“The pandemic has been a test of the multilateral system, its speed of reaction and its understanding of diverse country challenges. Never before in modern times has the world been faced with such a collective shock to its economies and health.

“The IMF has been a steady partner, disbursing unprecedented resources including debt forgiveness for the poorest countries using the Rapid Credit Facility. During 2020, the IMF rapidly activated all facilities in support and provided over $30 billion to African economies,” they added.

According to the 16 African nations, leadership has been an important element in the response to the crisis, with the MD having demonstrated steady qualities during this time of crisis.

“Many of us have known, interacted, and collaborated with Georgieva for many years. In our frequent meetings, we found her to be a true partner. In our dealings, she has demonstrated integrity, energy and progressive advice,” the African finance ministers stressed.

In addition, they noted that she played a critical role in the unprecedented general allocation of Special Drawing Rights (SDRs) equivalent to $650 billion providing liquidity and reserve buffers to many countries in need.

Furthermore, the 16 countries emphasised that Georgieva has fought to advance multilateralism and has been a vocal advocate for developing nations thereby contributing to the continent’s collective successes.

They added: “She is working with us to explore ways of extending debt maturity and dealing with the climate crisis. Benchmarking policy actions across countries has undoubtedly been an instrument of progress in the development community.

“While some of us may disagree with our individual rankings on the Doing Business index, we agree that the tool has allowed many of us to advance on our reform agenda and has helped us improve the business environment in particular for our national and regional private sector.

“Indeed, improvements in the doing business and the associated policy reforms have helped us and our private sector respond better to this crisis. The index of course like many indices is not without shortcomings and we appreciate that every year the bank and countries have worked to improve the methodology.

“The allegations surrounding the World Bank’s 2018 Doing Business report are serious and should be investigated. However, we also believe this should be done in a manner that does not undermine the integrity of the IMF and most of all, must allow for a fair and just process. African nations – indeed all countries – need inclusive and focused multilateral institutions to effectively and rapidly address current challenges”