\
,Distr.
RESTRICTED E/CN.14/ADB/30 10 April 1964
Original: EN GLISH
DOCUMENTS Ori'ICE , 1 '
I •
ECONOMIC COl/OOISSION FOR AFRICA Committee of Nixie on the
Preparatory Hork for the African Development Bank
e
UNITED NATIONS' -
ECONOMIC AND
SOCIAL COUNCIL
1
•NO TO BE ' TAKEN OUT
TABLE (])' CONTENTS
ORIGIN
EXTERNAL SUPPORT
ENTRY INTO FORCE (])' THE AGREEMENT THE BANK
Membership Voting Rights
Viithdrawal and Suspension of Membership Structure
Board of Governors Board of Directors Management and Staff Annual Report, Audit FJJ'!ANCIAL STRUCTURE
Capitalization Special Funds
Potential Resources of the Bank Currency at the Bank's Disposal Valuation of Currencies
Use of Currency Borrowing Powers
:tages 1 - 3 3 - 5 5 - 6 6 - 14 6 - 8
8 - 9 9 - 10 10 - 11 11 - 12 12 -: 13 13 - 14
14
14 - 20 14 - 15
15 - 16 16 - 17
17 17 - 18
18 18 - 20 63-4296
E/cN .14/ADB/30
.
.". ,
- i i -
•
~.
,
•OPERATIONAL POLICII:S Mill GI:HERAL CHARACTI:R OF OPCRATIOHS Ol" THe BANK
Furthering African Development Operations of the Bank
Operational Principles Selection of Projects LIMITATIONS ON OPERATIONS IIEETING THE BANK'S LIABILITY
TElVlPORARY SUSPEHSION AND TERIHNATION CF OPERATIONS THE BANK'S LEGAL STATUS, PRIVILEGES AND IMIIUNITIES
21 - 22 23 - 25 25 - 26 26 - 27
21 - 27
27 - 28 28 - 29 29 - 30 30 - 32
,.",
J
-
THE BANK AND THE ECA (undez- consideration)
A REGIONAL ORGANIZATION
n,
AFRICA (under consideration) A REGIONAL FINANCIAL SYSTEM (under- consideration)THE BAHK AND THE CAPITAL LlARKETS (under- consideration) THE BAlIKnW CO!~,IUJnTY (undar consideration)
OTHER INTERNATIOllAL AGEI'lCICS (und er consideration.)
•
,
I
THE AFR!CAN DEVEIJJP~l8NT BJINKl AN INSTB.UJIlENT FOR AFRICAN DEVEIOPMENT
A Draft Commentary on tho Agreement Establishing the African Development Bank
by the ExecutivG Secretary
ORIGIN
'.'. ,"~h".. idea of oreating an African DGv~10pm8nt Bank goes back to a resolu- ti'On adopted by the AII-Afric'm P',opl::s Conf ar onc e , hold in Tunis in January
1960.: .That resolution envisag8d th" "s ctti.ng up of an African investment 'bllillk' ..to.. pr omo-t e development proj r.ct s ", In 1961 a r .ao Lu't Lon unanfmous'Iy adopted ..by all African mcmb~rs of the United Nations Economic Commissibri :fdr'Africa at its third session "requested thG Exocu't Lv e Secretary to under-
~-tak8 a.thor011g11 study. of tlle possibilities of2stablishing an African de- velopmont
,"\:lank")!
Since then thr" project has been explored in a variety of ways, in accordance ,'ith United Nations pro c odur«, including secrotariat studies, panels of governmontal experts, panels of private exports, consul- tants, ECA Committoes, official and private consultations. At its fourth. ..
.-'.--
session, the United. Nations Ecoriono.c Commissicn for Africa conet t tute~a
Com~i
ttee compos ed, of nine mombor countrieeY in ordor "to mak e all n oc ossarygovornm8nt~1 and other contacts relevant to the Gstablishmcnt of the bank;
to
IWk" complete and compr-ohvns rv. studios into the financial and adminis- trativo ,stTucture of the proposed bade and into ths nature and extnt of its operations; to draft a charter for th0 African d~v(lopm2ntbank; and to make nocommonda.td.ona on its 10c9tion".21-
Resolution 27 (III) adoptod by the United Nations Economic Commission for Africa at its 50th p~enary meeting on ~6 February 1961. .The following countries wer8 Glc,ct8d mombc'r a of tho Committer.Jqf Nine, Cameroun, Ethiopia, Guinea, Liberia (Chairman), ma~i, Nig8pia, 'SUdan, Tangan;rika' and Tunisia.
Resolution 52 (IV)'adopj;"d by th8 United Nations Economic Comm'ission for Afri.ca at i.ts 75th plenary meotLng on 1 Narch 1962.
,"Ir \ "''',~" \, "
E/CN.14/iJJB!:;r
pa.ge 2
\
of
,
The Commit t"8 of N'in : und or t.o ok ext,.nsi vc consul tc tions cci th all African countries amd ·vith non-!1.fric~n gov:~-rnrllc:nts and institutions - studying the" most important t·jchnic<':'l and. o'p,Cjration81 iGsu:~s conc crru ng the Bank - and pr~par,d [he drJft of an Agrocm.,nt establishing the AfricAn Development Bankl!.
On 28 F,,,bruary 1963, the Uni t.ed Nctions "',cononic Commission for
Africa, aft r reviewing a progress r .port suhmi t Ld to it hy its Executi vu Secretary on tc,,, 1'!Ork unde,rt'.' c.n by t.h. Commit tc« of Hin in connection wi th th.; :cstablishm:,nt of the, Bank , not rd "vi til aat isf'aotfon th,t tho Exoc ut.Lv o Sccr •.toey (he.d) convc.n cd (a conference) of Africcn FinancQ Ministers Celled for in resolution 52 (IV), to b h r.l.d in June 1963", and
1~~~tro2.t~d ;11 Afric,~,h govcrnm~.nts
to ;;tt'ac.hgr~a
t importrnc", to.(thcJ~
pro-jpct and to give s c.ri o us consid~lo2tionto the report of the. Committf'co.t;
Nine and to the suggc8tio'ns to be F.l~~~l~. by thG Executive SGor.jtary (to} tho Confor cnc o of Pd nanc o liiinistcrs". It conf i rrnr d "its profound intor::st .Ln the establishment of an Afric"n d3vclopm,nt bcnk at the oar-La ost po sadb'lc date" and vr€cd all "govornments to particip t c i n the I,jeeting of Afrioan Financo Mini st.rs and to instruc t their r c spc.ctaV0 del "ga tions to tak:a ..the
ilT~e'committee
of Nine, at its fir",t session bcld in lilonrovia, Lib:ria, from 18 to 22 Jun« 1962, d ooi.dod to coriduot " series of consultations wit'2 the Afric2n ~tatc's, forming for this ;"lIpose three teams, each composed of thrc:e Committoc mGmb:,rs under th Lsad er shd p , r"spccti v:cly, of t'ho r j1rc- sontativGs of Ethiopia, Guinea ~nd Nig:ria. Th0 three t0ams, accompani(d 'by ECA staff mombez s , consulted th; GovrniT.cnts of Burundi, Cameroun, C .n-tral Afric'n R.:public, Congo (Brazzavill,',), Congo (Lcopoldvillc), Dahomoy , EthiopiC', Gabon, Ghana, Oum oa ; Ivory Coast, K ..nY8, Lih,ria, Libya., Mali, Mauritaru a , Morocco, Ni--:>-,r, Hi,:; ria, rrhod~~s.ia and l'Jyasaland (Federation)9 Rwanda, S,~'n;-:'9al, Sierra Lcorie, S::Hn.alL':l.:1 Sud:"n, '~anb,2nJik.a9 Togo, 'I'urri s i.a , Uganda, UAR (Egypt), Upper Volta., and Zanzih~r. Two ad hoc teams visited
Algeria, and Chad. Subsicgl.loht1y , at its s oco nd SCission held in Douala , Oamarcun , from 24 to 27 S,cpt,·mbcr 1962, the. Comrmt tc , d cci d ed to f,*m toro t cans , under th,o leadership' 'of, r ,(specti v.Ly , t.h.. reprCe"nt8 tiVi.S
of
Ethi-opia arid SUdan, whi ch accompamcd by UN of'fi.ci o.Ls , hc Ld .co n au.lta tions "i th i'the GovcrnmGnts of: Belgium, Canada, Czc;choslovakia, Donma rk , Fcd'6ra1
H",-
public of German:;, Franc ., Italy, Japfln, ,lLthccrl1 ' , n d s , Uni tcd·kingd.om, Unit cd StaLs of Amc.ri oa , Uni.on of SClVi..t 30ci,,118t Republics, SFCQCn and
Swi tzorl-;n<J,. These teams had also c onnul tat tor,e ;'·i th the Europ,,3.~Eco- nomic Community, Eur'o pcan Inv,'st;;;cnt fund, Intr-Am.;riccn D~vdopm.nt
Bank, Int ::;rn."tional Bank ior rt'jCOD.st.r uct i on :'"nCL :=J'~;1~--,lopm nt9 Int,=.-rnational Dov cLo cncnt Associ?~tion, United Nations Hoadquart-To and UN SpeciF.ll Fund.,
..
E/..C~.14/ADB/30 page 3 . •.
necessary and final steps towards an early creation of the African Develop-
ment
Bank".J.! . .
The Africen Heads of Stato who met in Addis Ababa in nay 1963 resolvecl unanimously "to welcome the forthcoming Conference cf African'Ministers of Finance and give thoir r·.spectivG ministors of finance instructions to take the. necessary measures for the rapid establishment of the Africen Development Bank" •
The next step "las a Conforene·eof Afrisan Finance Ministers, held in Khartoum from 31 July to 4 August 1963 under theauspioes (j·f the United
Ne.ttons Economio Commission for Africa. A meeting of senior officials and experts, preparatory to that Conferenoe, was hold at the same pl.ace from 16 to 27 July. The Conference reviewed the draft Agreement establishing the .Af.ican Development Bank - which had been .prepared by th~' Committee of Nine
in the light of the recommendations submitted by its preparatory meeting;
approved its text and opened the Agreement for signature. Twenty-~wo
governments out of the thirty-three eligible for membership signed i t a t the closing session of the Conference.
EXTERllAL SUPPORT
Thus a wish so often expressed becomes a reality. The establishment of the African Development Bank represents, as stated by the Chairman of the Conferenc", H.E. Sayed Abdcl Majid Ahmed, the Minister of Finance and Economics of Sudan, Africa's confidence in herself and in her future. It demonstratos the ,,'ill of the; Africans to botter t.homsolVeS as well as' the determination of African govcrnmcnts to catch up with the r st of the de- v.eloped world.
The establishmont of the African Development Bank is undoubtedly a matter of great ooncern to Africen peoples. This is proved by the prosence of t'1irty-tvo Africon govcrnuonts at the Khartoum Conf ar onoa,
11
Resolution 76 (V) adcpted by ·the Unitod Nations Economic Commission for Africe at its 96th plenary moeting on 28 February 1963.E/CN .14/AJ.JB/30 page
4
The interest that the establishment of suoh an institution has provoked
• !I •
in the world is shown by the attendanoe of obserVerS from fiftoendifferent ~ governments from Asia, Europe, Far East and the Americas. It is also evi-
deneedby th.. sympathy and aesd s tanc o of twol ve observers from international and inter-governmental organizations and institutions and by tho presence of representatives from most of the United Nations spooialized agencies.
The United Nations has, sinoe the inception of the projeot, afforded all assistanc0 and expertise its staff could supply. In addition to the seoretariat of the Un:i.ted Nations. Economio Commission for Afrioai·whioh bore tho immediate responsibility for tho preparatory work
an
oonnectioniwi th the .project, various services of the United Nations in New York and-its regional commiss:i.ons did not spare time or effort in advising-and in ~reparingbaCK- ground material. It is for this vory reason that at the closing session of the Conference the United Nations Under-Secretary for Economic and Social Affa:i.rs stnte<!- that. ":).t had oe,m a great priviloge for the United Na.tions to assist at the birth of an institution Wb:lDh, though it wou::.d henoeforth gra- vitate in its own orbit, would cortainly romain closoly linked with various United Nations bodies and would bo working in a spirit which was that of the United Nations and for objoctives whioh were those of the United Nations".The prospect of the African Development Bank did not leave similar institutions already established unaware of the role which such a-Bank would play at continental level as ;rell as in the financial w~rld gen"rally.
Tho Int3rnational Bank for Reconstruction-~ndDevelopment ~nd its- affiliated agcncies have closaly -followed the "ork of the Committee of Nine in tho prparetion and drafting of tho Agreement establishing the Bank. The International Finance Corporaticn lent one of its senior official experts to assist tho Committee of Nine in formulating policy lines and helping in preparing the Agreement. It may be expectod that collaborqtion extonded by the World Bank at the initial stage of tho creation of the African Dovelop- ment Bank ,iill turn into a close working relationship upon ita ao tuaL__e.stab- lishment and commenooment of ope"ations. This was partioularly mentio~Bd by
-c:
its Pri.si.dont , Mr. George D. V!oods, in his message to the Oonf or ence of Afri- can Financ~ Ministers in which he outlinod sevoral possible. avonue.s for collaboration.
E/CN.14/ADB/30 page 5
The Inter-American Development Bank was the first institution outside tho United Nations family of agencies to express support for the idea of an African Development Bank. Since the vDry beginning of the wone of the Com- mittee ,of Nine which started in Monrovia in 1962, the Inter-American Develop- ment Bank had been represented at each session of the Committee, offering
each time in Monrovia, Douala, Geneva or Casablanca, the advice needed on , the basis of its ovrn experionce in Latin America. In sev~ral instances
during the wone of the Committee, its reprGscnatives spoke frankly and ex- tensively about how ohey themselves had arrived at the provisions of the Agreement establishing their own Bank; how that Agreement was operating in practice; and what lessons they had learned during the three-and-a-half yoars their Bank had been in existence. Although conditions in Latin America and Africe. differed in several rCJspects, the experience of the Intor-American Develcpment Bank was found valuable. Hence several features of the Agreement of the Bank are now refloct cd in the Agreement establishing the Afric9n D,e- velopment Bank. The President of the IntGr-Americ2n Development Bank, Mr.
'Felipe Herrera, expressed this line of thought when he told the ConferencG that "as the African DevGlopment Bank starts and proceeds >lith its activities, it will find many valuable lessons in the experience accumulated by the
Errtor--Am er-i ccn Devel opmont Bank".
ENTRY INTO FORCE OF THI: AGREEI'liENT
The Agreement establishing the Africsn Development Bank will entor into force upon the deposit of instruments of ratification or acceptance With the Secretary-General of
, 1/
of the Agreeme4t= - by twelve tions, in aggrGgato 9 compris~
units of account
1l
that is tothe United Nations - appointed Depository signatory governments who s o initial subscrip- not less than 65 per cent of 21l.~ million say not less than 137,280,000 units Of account (one unit of account equivalent of US $1).
Artic18 63 of the ADB Agreement appoints the Secretary-General of the Uni tod Noti ons "Depository" of tho Agroement.
Cf. Memorandum on tho Entar-prots.tLon of Article 65 of the Agreement Estab- lishing tho Afric!J.n Devdopmcnt·Bank by )'ir. RobcrtK.;" Gardnincr, Exocu-«.
tive Secretary of the UnitGd Nations Economic Commission for Africa, documont E/CN.14/FMAB/39, page 58<
ElcN .141
AIiB/3Opage 6
Tho Agreement provides, however, that 1 January 1964, is t~e earliest date on which it may ontor into forcG.l!
As soon as the Agreement enters into force, the Secretary-General of the United Nations - appointed by virtuo of a resolution adopted by the Conference of Finance M.inisters, Trustee for the Agrcement1/will call the first meeting of the Board of Governors. Pursuant to that resolution, the first meeting of the Board of Govenors of the African Development
thirty days from ths date on which the Agreement
Bank should enters into
take place within force.J!
At tho first meeting of tho Board of Governors, the Directcrs of the Bank will be clected and arrangements made for the determinaticn of the date on which tho Balli: should commence its operations.
AI
THE BANK Memborsnip_
Those who framed the Agreement were resolved to establish an institution which would pursue an African mission and be African in char-aoter , They advisedly wanted to limit membership to African Governments, having in mind the desire of their governments to embark upon a co-oporative African venture. The Agreement, therefore, lays do,m that only African countries which have the status of an independent State may become members of the Bank.
2I
Accordingly it was decided that Africsn countrieS which enjoyed tho status of full independence at the time of the Conference of FinanCe Ministors were
Agroemento
for 12 Decembor 1963, the Conference felt that she could ately to the signature of, the AgrGoment.
eligiblo for memborship and could therefore sign the was made for Kenya. Since its date for independence had
An exception been officially fixed be admitted immedi-
l!
Cf; Article 65 of the ADB Agreement.11
Resolution 2 on the Appointment and Duties of the Trustee for the Agree- ment Establishing the, Afriocn Dcv.c.lopment Bank. adcpted by the ConferenoEl of Finance Ministers at its final plenary session on 4 August 1963.J.!
Ibidem, para. 3.~ Cf. Article 66 (2) (a) and (b) of the AnB Agreement
21
Cf. Artiole 3 (1) ibide~.Thus tho following African coun'cri os ar c oligibic. fur iTi(,mbcrship of th& African Development Ba~~ and may sign th8 Agroement:
•
'l'o go Tuni1)ia Moraoe,.
liInurito.nia
i'Tigt r
Uganda
Uni ted Arab Ropub1lc:. '., Upper Volta.
22.' . Nig"zeia 21.
24.
:Senogal25..
Sierra Leone 26. Somalia27.
Sudan 28. TanganYika 29 ••30.
n,
32.
33.
Contral African Republic Chad
Congo
(Bf~zzavillo)
Congo (' Lcopoldville)
Dahomey 1t.
Ethiopia · _ r Gabon
Ghana Cameroun Alg;cria Burundi
Guinea Ivory Coast Kenya
Liberia 'Libya
Mada~ailcar 13.
14.
15.
16.
17.
1.
2.
3.
4.
5.
6.
.. 7•
.. ': .t"-·a.
9.
10.
11.
12.
j .,
",
AftGr the Agreement has entered into force, lSric'.n countri:.G vrhi ch hONe not ac qui r cd m.mb_rship of t.ho Bank undllr the proccrlurc out11ned
.
' .a~ove
. \ \
and which wish to oocome memoars, at a lator stagG, may do so by accesston on
•
Cf. Article
64
(1) (0) of th2 ADB AgreementCf.
Article 64 {l) {a)~ ibidemE/CN.14/JJ)B/30 page
8
terms and conditions whi ch will be d et or'm i.n cd by.the Board of Governors of the Bank.
Y
One of the t :..rmsof accossion '"ill undoubtod.Ly "ntail evaluation of the ini t i d subscription and ·of the aha.r; vaLu., in rcclation to the, business and crsdi t-,rorthinGss of the-Bank at tho time the Case, will be considered.
This could, however, have somo negative effect on Africon torritoriGs which, al though they werG willing te join the Bank at its out s ct , 'F,re, prevented from doing so because of their constitutional status. Th' Conference did not overlook this prob'l enu ;n passed a rGsolution inyi ting th~ Board of Governors of tho futuro Bank, to be sympathotic
bel'S of the United 'Nations Ec.onomic Commission
to~1'le Afric,'n aseoci a't;e mom- for Africa and urged
•
i~ to see to it that terms "no less' favourable in all respects than the tc,r.m,s on.
which they could have beon members of the Africcm Dcvdlopment Bank ai; .any earlier time'.1I should apply'to such countries "lEn seekIrig membership of the Bank after acquiring the status of an independent State.
· -
·
.,the voting pOW0r rGprcs0ntcd at thej' meeting of th" Board and the Board of Directors, are to be decided by a
in.
·
.vo t G IO.t each The A,grilement all matterebefore both has 625 vot "s and one addi tionel
it.lI
of capital stock subscribed by to o c.r-t.ai.n specified oxcc.ptLorie , pro;v:ides that, subject.
..;.. ,
the Boa~d of .GoVernors Votihj( Rights
Each mGffibor of tho Bank
•
10,000 units of account
majority of
qUestion~.1I
.'
.
V or,
Articlo 64'{2), of' theJJ)B Agreementj,j;
Resoiutio~J
on Kcc~ssion to' the il.gr88mGnt Estab.lishing tho Africaft Dovelopment Bank by the Africon\"as.soc.i'lot., mC\nb?rs of tho UnHJd'),q~lons Economic Commission for Africa, adoptod by the Conf8ronce'uf FinancQ' Ministers at its final plenary session on 4 August 1963Cf", Article 35 (1) of the ADB A[;Teement •
.
'Cf. Article 35 (2) and (3), ibidem
•
1"lrq,r,."! V.J. <.-;~._ii-;1.1H.-:,."'Tl"R/")~-)._"
page
9
The formula ad opt ed for the distribution of voting rights is undoubtedly an' outstanding product of compromising the, principle of allocating votLn.;
power to members strictly in p'ropo r-ti ori of their subscriptions (for Lnstanc e one share - one vat8) - ",hich would confl ict "i th the pr i.nci p l(,8 underlying African solidarity -. 'fi th the alloc'ti?n of voting power to m~mburs strict:Ly on thG basis of equality - "hich wou'i d , on the other hand, not co'respond to the truG nature of the whole oo-0}orativ8 venture. The corresponding Article of Agreement as i t stands, now provides for a "rapproohGment" bot vreen Sfualler and larger cont Lbu'to r s , ROliever, the Agreement also stipuL:tc:J that in three years time, at the La t.ust , aftcr its entry into force', t'1e rule 3.ocor- ding to "hich each ;J mbor should have one vote, "ill be· examined by the BOJ.rd of Governors o.r at CJ., mo oti ng of Heads of State of the rnombGr cOUl:t.ric;:)') This, of course, will De done in tho light of tho experience that the ]2~
will acquire meanwhile,
Wi thdrawal and SusPGilsion of Mnmb'Tsbip
Any msmb..r- is enti tl od to "i thdra" from membership o r' t:"8 : "..t-~ '-,c... "+ _(,.1,.."~r
time. ~;ithdra"al boc omos c.ffectivE on tho date specified in its notice to the Bank, out in no ov~nt
of withdrawal is ~eceived
less than six months
by the Bank.
Y
aft3T thc~ d2t-J \,rnen the notice Any member which fails to fulfill any of its cbl iga 'ions to th8 Bank may bf; suspended by the: Board of ])irQctors un l o s s 't.hs, Bo ar-d 01 UC'/(3rnOrS at a subs8quent meeting, callsd by th~ Board of Directors for that purpose, decides othsr"iss by a majority of the Governors exercising a majority of the total voting power of ths msmbers.lI ·
Unl@ss a suspended member is re- stored to good s t.arid'i.ng ,·,i thin one year by a similar vote, its membership is au-t omatLcal Ly teJrmino.todoY
While under suspension, a member may not exorcise his rights under the Agreement, oxc cpt tIE right of "ithdra1'Jal. This, hovovor , docs not disoharge i t from carrying 0Ut all obligations,.21
1/
Cf. Articlo 60(4)
of ths ADB AgrocmGntY
Cf. Article ·f'> , ibidem---
)/
Cf. Articl G44
(1) , ibidemY
Cf. Article44
(2) , ibidGm.21 cr.
Articl o44 (3),
ibidemE/cN.141AIlBI30 page 10
Settlement of the acco unt s of a State \/hich ceases to be a member of the Bank is regulated according to p crt i n ont provisions of tho Agreement.V
Structure
Tho Bank's structure consists of:
(a) A board of Governors composed of one Govc,rnor and one Altsrnate Governor appointed by each
mGmber;~
A Board of D'i r ccto r s , nino in numbsr, olected 'b, the" Board of Govcrnorsll]/ Each Director appoints an Al t2TnatG 1rTi th pO'\<Tzr to act for him in his abs onc e ;
AI
and11
~/hen a State c casc.s to be a mc,mb,T, thE; Bank is requirc;d to arrange for the repurchasG of its shares in the c~pit21 stock~ The sharss must be repurchased at book value as part of the general settlement of accGunts wi th tho mombor , The State roma tns liabl", how.rv.r , for its d.i r t-ct obligations to the Baw, as borro\/8r or guarantor and for it3 continGont liabili tics out of loans or guarantees contracted by the Ban', bo:ioro"the date i t c ca s e d to be a member .arid to the extent thc,t :'.ny lOSSeS oz o o od tho amount of the reSerVe) against losses exi st i ng on that d.at c ,Th8 payrnr.nt duo for shar.~8 r opur-cha s od by the Bank in :nade against any liCibili ty as borrowsr or guarantor ofthJ State concerned. or its
central bank or any of its ag oncd os to the, Bank. This pr o vi s i.on , ho;revcr, do os not apply tv th<i State 's liability for its subscription to the
share capitel of thG Baw<,
RGpaym8nt for repurchased sharss may bu made from tim;~ to time upon surrender of shar-es by the State concerned, but in no cas" can payment be made before the sixth month a:iter the termination date,
Payment is made in the currency of the State receiving payment or, if such currency is not ava.i Lab'lo, in gold or convorti.bl c currency.
If th. Bank should terminate its operations "ithin six months of thl' t.rmination date, the settloment of accounts of a State ,ihich has ceased to be a. mcn.bcr , as well as his rights, are govGrned by provisions of tho Agreement concerning the' trmination of the Bade's cp"rations
(Articles
47-49
of the ADB Agreement.~
Cf. Articl e 30 (1) of tho ADB AgrecmGntJI
Cf. Article 33 (1) , ibidemj/
Cf. Articlt: 33 (2) , ibidemE/CN.14!ADBj.30 page 11
(c) The Management, consistingcf tho President, who is elected by the Board; of Direbtor~·by a majori t'y of the total voting power ofthemerttb8'rs;Y at least one''1:i.ce'-prOsident,Y elected by that Board on the r ecoumondc t.Lon oi·'the·PrnSideht;J! and an internaticnal . staH .appo Ln.ted by the President.
Y
Board of Governcrs
Under the Agreement, all the powers of the Bank are vested in the Board of Govenors as represeritll:hvo§ of the
B~nk's
stockholders •.21
However, with certa:tnpij,<ceptions·, the Beard.·cf Governors is authorized to delegate its pow.ers to the Boar d ofDlre(;t0rs,~/·
The exceptions include the· admission of new members;1I the a ncr sas e. o r deorease of the· capital stock;Y terms and conditions for payment of sUbecriPtion;2I establishment of or acceptance of the administration of Special Funds;12I determination ofrem~net~ti9n
ofDirectors and their Alternates;ll! selection of outside auditors to certify the general balance sheet and the statement of profit and loss of the Bank;11I.
. , ' ., ".
~pproval
_-, .:.J:JI
of the general balance sheet and statement of profit and loss of the. . . . .
Bank;. decisions on app oa'Ls from interpretations.,of the A'F0oment giyen
. ill ' ..
by the Board of Directors; .- .approyal of general agr eement s wi th other
Y
Cr. Article 36 of theADB Agreement11
Cf. Articl e 4; ibidem---"-"-l!
Of. .Article, 32 (a) , ibidem---- if
Cf. , Article 37 (2) ,'ibidem---- .21 cro
ArtiC'l"l 29 (1) , ~~.id.8~~ Cf. Article. c } \....;'.' iblQGDl
~"---
11
Cf. Article 64 (2) ,_._-
ibidomY
Cf. Articles5
(3 ) and 29 (a) , ibidem21
Cf. Article 7 (2) and (:)),
ibid.em1Q/
Cf. Article 29 ! 2) (0) , :i..1jidem-,--- ll!
Cf. Article 2) \ 2) (d) . ibidem111 cr.
Article 29 ( 2) ( e) , ibidem-_
.._-
J:JI
Cf. Article 29 (2 ) ',1 ) )----
ibidemW
Cf. Article 61 (\ ~-"). ,
ibid~E!CN.14!ADB!30 page 12
Lnt or'nati.cria.l or;anizations, Af::ican govcr-nm errt s not yet members of the Bank, other governments and other financial insti tutic.ns in Africa;Y and d ec i.ed ons'.on, distribution of the net incomQ. of the .Bark and paymonts on the
liqUid;t~on
of the'Bank.lI
The Board of Governors is required to meet once each yoar. Additional mestings may be provided for the Board itself or cal18d by the Board of Directors. A meeting of the Boerd of Governors must be called by the Board of Directors, if it is
,which have on~-quarter
requested, by five members of of the toW voting power.]J
the Bank or by members
In ca, oS where a deci~ion hy thA Board . f Governnrs is required between regular annual'meetings, it can be obtained by telegraphic or mail voto , iftbeBoard of Directors so decides.A!
Bo~rd of Directors
The Agreement provides that tho Directors shall be elected for a term of three years.
2I
In accordance with normal business practice, theyareresponsibl~
for the conduct of the general operations ofth8B~.§j
.~-_._. -In addi tion, 'Directors ti:ike decisions - in oonformi ty wi tll general ciLrec- tives outLr.ned by the Board of Governors - concerning particuJ,.'\.:t' dir(lcf.
loans, gue.r an teos, investments in equity ce,pi tal and borrovling of funds \, -.
by tp.e Bank;1I determine th,) rates of interest for'dir·ect Loans and on commissions for guarantees; submit the accounts for each firiancial ,year.
and an annu9.1 report for approval to tho Board of Governors;.§! and de- termine the oneral structuro of the servicQsof tho Bank.
2I
]j
Cf. Article 29 (2 ) (c), of the ADB Agreement11
Cf, Articles 42 and 49, ibidemJ!
Cf, Article 31 (1), --<.l:~.~.-dEIDA!
Cf, Art i c Lo 31. ( 3) , ibidem21
Cf. Article; 33 (3), ibidem§j
Cf, Artic1 c 32,- - -
ibide:n11
Cf. Article 32 ( c) , ibidemy
Cf. Articl e 32 (e) , ibidem21 cr.
Article 32 (f) , ibidemvoting
E/CN.14/ADB!30
pag c 13
A majori t
c"
of tn.. ;)~c'c8tor3, exercising tvlC-thirds or more of the total power, constitut s~
quorurn.l! Each Director casts the votes which counted toward.s bis election; they must bo cast as a unit 2nd cannot be divided,.YTho Pr-csi d out of the Ba'll< is clcct rd by the Board of Directors. He,-
acts as its
Chai~~an;]/
hohas~ howGvGr~
no vote except a deciding vote in case of an cquaI di Vi3j.c,,,,,A/ HG is chief of th,-" staff of tho Bank and, subjoct to thee <lirocti· l 'by tl:',c Boar-d of Directors on questions of policy, is responsible for thp conduet of the ordinary business of the Bank, the or€,a.niz-:-tion of itsl~t;d'::::'
9 and its _'),ppointmcnt and rolsasc.2I'Tho term of office of the President is five years. It may be renewed.
It may also be encied by " decision 010 the Board of Directors takon by a qualified' majori t,,- of th'J voting powor}/
In the discharge of thoir of'f'Lc os , the Prcsidcnt, offic'.ers and staff of tho Bank 0"'0 t.hcd r .d.ut.y cntirc;ly to t;10 Bank and to no other authority.
Under tho Agreem8nt, c-,eh, mcmbor- gov..r'nmcnt undortakes to respect the inter- n' tional charrct.oz- of this duty and to r~frain from 8,11 attempts to in-
fluonce any of the staff in the discharge of thGir official rosponsibili tios.
1I
As may be; in"corp"~";Gd from the Agreemont, t hr. lianagemont and the staff carry out ths a~tual oyer2tior.al activities of the Bank in accordance with gonoral policios cl'pre''''cd by the Bo s r'd of Diroctors. Docisions of the Board of Directors vnll 110 r,'qui:'cd for all loans and bank issues, the annual ad- ministrativE huclco+, eu.bmi ac i.on of r opo rts to tho Board of Governors and othor matters inv01,ing iosue8. The Board of Directors will normally
1/
Cf. Art Lcl « 3'~ (2) cf tho ADD Agr03mont.Y
Cf. Article 35 (:)), -_.,_
ibid-8m..•_~--J!
Cf. Article 36, ~~~~~_'?-~sJ
Cf. Article 37 (1) ,---
ibidem51
Cf. Article 37 ( 2) , ibide!!!§/
Cf. Article 36,----
i'l)idenlJ.!
Cf, Article 38 ( 3) ,._._._"
ibidemE/CN.14/ADB/30 page 14
take action upon recommendation by th_ ManagemGnt and will not gGn~rally
concern itself with matters of routine administrction.
Annual Report, Audit
The Agreement requir~s the Bank to p~blish an annual report containing an audited statement of its accounts as of th~ close of its financial year.
Tho Bank is elso under the obligation to publish quarterly a summary state- mont of its fin~ncial position ~nd a profit and loss statement showing the results of its operations.
1I
FUJANCIAL STRUCTURE
Capi tali zation
The authorized c api tal stock of th. Bank is at pre ant 250 million units of
accoun~
(one unit equivalent to one US dollar) half of which will be paid-in and half remains c2l1able.l!211,200,000 units of account have been allocnted among the thirty-three African countries at presont eligible for membership. The remaining
38,800,000 units of account 8ro still availabl for subscription by African countries.
The present paid-in capital of 105,600,000 units of account is to be paid in gold or convertible curroncyi! in six instalments, the first of which is five per cent, tho second thirty-five por cent and the remaining four instalments each fifteon per cent of tho initial subscription.
21
The first instalment is dUG on or boforo the date of deposit of the instrument of ratificction of the Agrc8ment; the second instalmont is due after six months from the 8ntry into force of the Agreement or from the
11
Cf. Article 41 (3) of the ADB Agreemont.:Y
Cf. Article 5 (1) (a), ibidomJ!
Cf. Article 5 (2) , ibidem.Y
Cf. Article 7 (2), ibidem5.1
Cf. Article 7 (1) (a), ibidem?;/
Cl'l .14/ADB/30page 15
d.epo e.i,t of the r8:tific-tion. ins~rU~11cnt b~l th m.::Iilb':T cone rns\.l - which,::v:cI' is the Lats.c elato; the third inst2.lmcnt is elu. aft r.r ;j.ghtcon months from the :entrY Lnco fore~ of the Agreement; the: other three instalm8nts are Pi1yable .
th8,~ee,fter
..
at Y02rly intrvals..
- . .Y
Th" commi tm,:nt of co,ch country, eligible 1'.\'.1' :Jsmbcrship, is shown in Te.bL, 1.Un l os s m:::mbi~:r co untr ios ar·,;. willing -to anticipate th.; pavm c.nt of thvir SUbscriptions., tho Bank vri.L]. dispose of the) total of i t s ini t i d pai.d-cup capital aft,,1' fifty-four months of its exist.ncc. It is, therefor., ob- vious, tha~ 1'1'01'1 the bginning additional funds ,,;ill ' J ' ncockd if the Ilank is to por'f'o r m'~'rorl<. on a s c e.Le that vTould b.. of si~=:nific!3,nc,:- for Africa's economio dovclopr:ont as a vrhoLc ,
The capital of the .Banl<7 and its st.bsc r-Lpttion soh me, c I.o. rl.>" show the fi1'n intention of t.hos; who prep r.;d the Agr"cm(mt t h t tho B~nk should in due courso obtain funds in t h. c".1Jited mar-cr.t s , This thQl-~g'ht is r .fl::;c- ted Oy tho amc urrt of tho callable capital (up to 125 million units of
account) vrhi ch .f;:.=-'~.s,th,:: 'bc si s for such marki.t tro.l13:".,ctions.
Hcnc-, .it is of some intcr;:,st how soon ;).nCL to -cho,-c xtr.nt the BarW .r.iL'l be ab1 c to iSC110 s ecur Lti c s , As in th . 0:)86 of t.h.; \'lorld. Bank and a.cc o r>
ding to thG cxp er Lerice of tho IntC"-Am r i.c an D,;vdoprJ.n t:'IlILs i t ,",!oj b expected th?,t acti -,D will be n0c'~'Ss,a.ry,by many .Jt-"t
the purchase of cuch s ec ur Ltics for trust f und.s ,
1- .' . ,
u0 p_rm.l1;
Lmpor-t.arrt that t n ..' Bank should have a 1·1<.>11 s ~.l;~ct,~':Q po r-t f'o Li o of loans b,,- fore i t rn ak.c.e c.9Jl on t.h ; monoy markets .. This ~:Till ;j,~;m(J::"3't'!C:t th Bank l~j
abili ty to mc:lc. '"ar.8 vhi ch ar .c ono.v.ice.Ll.y '" .f111 nrl 3.1' br.sod on sound bank ing p,_'incipl,w.,
Tho .AgrCCTnnt autc o ri z ,8 t.h: Bank to est b li su or ac ci pt th administr;'- ti on of Specie,l Funds vh i.ch ar • d'_;8i::,n~"J. to s rv its ,iH:.iTl)OS,=, ~;.nd.'-"Cor;l -'Fit:'" in its purpose and f'unct ion s ,
1:/
C'o .:\::t:i,.'.8 .. (1) (b) of th AilB Agrcemont.E/CN .14/ADB/30 page 16
SIlGcial Funds are, subject to s p..cLaI rules ".nd r~2'u13tions to be agroed on b~tFG(m th Bank and th sponsor in ac co r d.anc e ,·-i th the, nature and char-act or-Lst i.ce of t.h.. fund co nc o.rn c.d , pr'o vi dod t.hrt t:::"t,.TS is no in- consLs tenc loTith o ortain provisions of tn. .At~Tc,:'iJ0nt lthich apply cxpr,~ssly
to special r:.;SQurce.-s or syJ0ci0,1 oprations of t.n , Bank. 'l'Iruc , an important rule is that rc s our-o os of ap cci c l f'und s uust be; k,::IJt s'parat,,) from the or- dinary c api t"l r,30Lrc~s of th o Bank. Ordinar;y' rosourc:s cannot be used for special opcr3tions.Thoy IlPLSt b., s __;,·'Tat:.:-ly acc ount od for.
Y
Potential Resourcs of th~Bank
The totel r i.sour c..s of tIL, Bank arc divia d into !1or,~~_in2.ry capi tal r osour cr.e" and "s peci a I r ..:sourcos".
Ordinary c opi te,l r"sourccs of the Bani; incl udG:
Y
(a) Subscribed. authorized capitol stock of th, Bank;
(b) Funds raised by borrowing of tl-h Bank;
(0) Funds roc oiv ad in r,:psym::.nt of loans made by using the p2,id-iri ce.pi tal of the Bank or f'un d s r'lisc,d by borrowing;
(d) EncornG d,~riv..d from 10 sns Dl2CL: 01' [s'"ll.D.r:?..nt<:cs gi von ag'pvinst thE' c e.Ll.a b.l o stock capital of the Bankj a.s w011 as
(8) Any other funds or income r;,;-c0iv'ci h'l t.h; Bank: vhi ch do not form part of its s p . ciel r,~-,sourC08"
Spscial retOUrc8s a" the di s po s a.I of t.h. Bank,JI
(a) Rc.sourcus ini ti2.1ly cont.ri but vd to any Sp"ci.:tl Fund ',s+ablish ..d by the Bam, or sntrustcd to it;
(b) Funds borrowed for the .o1::.1';oG of any spcc La L f'und s ;
(c) Funds bo r r owed by the, Bank frorr,:,ny JO,mb.,r in its c ur r c.ncy for f'Lnanc i.ng cxp ondi tUTO in t h.. 1:~nQing country in r~8:p,~-,ct of goods or s cz-vic:s neede,d to carry out a pr-o jcct in t n.. terri tory of
~nother
ffiGffiber;A!l!
Cf. Article 7 (4) Bncl Article s 9 to 11 01 th: ADB Asre mont ,11
Cf. Article9,
ibidemJI
Cf. Article 10, ibidomAI
See uno.cr s p ocia L borrowing pov.rs br.Lo v ,E!CN.14!ADB!30
paM
11 .. '"(d) Funds repaid in respect of loans or guarantses financed from the rosourc~s
.
of any Spociol Fund;.(e) Incom' derivod from opcrations undsrtak8n by using or committing any of tho aforomantioncd special resourc3s or funds;
(f) Any other resources at the disposal of any Special Fund.
Cur~ency at the Bank's Disposal
The Agreement lays do,m thct the paid-up portion of the sUbscriptions to ,he o.utJorized capital stock of the Bank should be wholly paid in gold
Or
convertible currencies.lI
This was specially providod since, po.rti- . cularly in the early yoars of thGBank, its mombcrs will nGod loans mainly•in hard currencies. 1~atevor funds in mombors' currencios tho Bank may
,
".
need, it can 'bc obtained mora appropriately by other mcans , chiefly by loans from its members under tho spocial borrowing po vcr s accorded to it by. the Agreement.
Payment of the callabL) portion, vh cn called partly or wholly, may be mad.c at the option of each member, either in gold or convertible cur- .rency or in tho curroncy
for the purpose of which
.Valuation of .Currencies
rG~uircd to dischar~8
tho call is made.1/
the obligations of th~ Bank
T.ho Agre'cmcmt pr-ovi d os t.hs.t the' val uc of "ny currency in t ,'rms of anc>1;hor currency, of gold or (>f t.h.. unit of account (e~uiv?Ljnt of
0.88861088 grammG of fine gold or one US dollar) as woll as the qu stion of wh"thor any currency is convc.rti b'l o , should be det.rmincd by the Bank aft"r consultation with thc International Monetary Fund.l!
\~enover the par valu0 of the currency of a membor is roduc0d in torms of the.Bank's unit of account, or its foroign exchal1f'i vC\lu8 d,,- pr ociat.s ~o 3 signific"nt extent, the Bank is Gmpol%rod by tho Agrecment
lJ
Cf, Arti.cl e 1 ( 2) of the ADB Agreement-11
Cf. Articl e 1 (4) (b ), ibidemJI cr.
Article 26, ibidemE/CN~14/ADB/30 page 18 .
to request the member oonoerned to pay an amount of its currency roquir2d to maintain the v~luc of such currency held by the Bank, excopting cur- rency
d~rivGd
by tho Bank from its borrowing.l!.Conversely, whenover thG par val uo of the currency of a member is increased in terms of tho Bank'S unit of account, or its foreign exch~nge
valuo approciates,to a significant extent, tho Bank must pay to the. m~ber
' - ' .
concerned an amount of that currency required to adjust the velue df" all such cuxrency held by the Bank, exc8pting currency derived by the Bank from
its:borro,dng.
1I •
Hilwevor, the Bank may ,;aivc th,cse rules 'if, in its opinion, therE! has beon a proportionate chango in tho par value df the currencieS
of'
~lIO'its membors.lI'Use of Currency
A loan may bs mado by tho Bank wholly in hard currency or partly in Loc aI currency (that is to s~y, in tho currency of tho member in whose territory tho project in qUJstion is to be carried out). The Agreement encourages t.h, use of LocaI cur-r enci es in making direct loans. r't''',;''uthor- izes the Bank to lend in Loc s L currencies in or'd"r to meet local expendi- ture, prOVided that the Bank can do so without sellin£ any of its holdings in gold or convertible currencicsA! and that in its opinion that part1cular 10c31 expenditure is not likely to cause undue loss or strain on the be.lance of payments of the country trhor o the project is to b,-,carri"d
out~jf
Borrowing Powers
The Agr,ccinent authorizes the, Bank to borrow undo in mccmbcr countries and cls(""h,r and furnish such oo Ll atcr-oI or othr s ocuri ty as it may deem ncc caerr'y ,~ The Bank shall, how8vcr; soek the "pproval;
11
Cf. Articl e 28 (1 ) of ths ADB Agr"em8nt11
Cf. Artic18 28 (1) , ibidem]/
Cf. Article 28 ( 3) , ibid 8mAI
Cf. .Art:.icls 16 (a), ibidem21 cr.
Articls 16 (b) , ibidem~
Cf. Article 23, ibidem(a) of the country in th,~ mo:rket of "rhich i t is making 8, saI , of its obligations,
(b) of the mombc,r in t.h currency of which it plans to denominate its obligations; and
(0) of t h . 8 tHO concorns in C:,',8S 'thr, Bank int0nds to inulvdc the f'uno s to b~; borrowed. in its ordinary C9,I)it'11 r :;fJ0 FJ:'C _;8, end wishes, thcor"for,c, to b.. aut.ho r Lz ad to hav. the pr o o srds ox- changcd for GUY ott-or curr oncy ~~it.hout e.ny r'28 triction"
A unique, aspect of th; Agrecm,cnt which in tr::'8 of Africcm reality givus eKpression to African solidarity, is constitutcod by the special borrowing power's ac co r ded to .the, Bank.
Y
Under these pO'"ors the' Bank is authorized to borrow from any mombcr- its currency for the purpc s. of fi nr.nc i.ng goods and servicus to be ac- quired in the: lending country and be, used to corry out a devc,lopment project in the territory of ano-th.r member.
The dr-aftcr s of the Agreement rC9,lized th9,t for s om.; ;/Cars to come the Bank would not be ".ble to usc cur-ri.nci .,s of all its mcmbcr s , But they en-
visaged c Lr-cumatano os in vni cr, it could us o currenci ce of some memuer-s , While none of thG Africa" countri ,8 is yct ':it.hc.r a capital ,export:,r or, to' any 8ignific~nt degree, a produc0r of capital goods or technology, o oct a i.n . industries do oxi st or ,"r~ being Ccstablishod in som ; member OOun- tri8s whose products could be uscd for dev(J:'opmc,nt pr-o jr.cts Lo c at cd in o thi.r member oountri os, At the; s·g"InG time i t oc;,.9pu?r'.Jd unwi s o to f'o r'c ; the Bank:
to purCh~S0 such currencies with its limitd· rcsourC8S in conv.jrtible our- r8ncy which, even under th0 best circumstances, could not possibly s~ti$-
fy th0 combined needs of all it s mzmb.rr s , On t.h. other hand, it "OS thought that thc r.mount s wh .cn thG Bank was 1 iksl;y to rie ed in any one ;nember cur- r oncy ,rerc bound to b" limi te,d and "auld, mor:ovr, be dro"n chiefly from th8 marc d,vsloped m.smb.,r countries "'hich vTere i n " "osition to pr o duce the required goods QDri 8:Tv"ta -r<
11
Of. Article 24(1)
of thG AnB Agroement.ElcN •
1 4j.IJlB! 30 page 20It appeared, thcr,;forc, Clp"roprie.tc. to Lnol ud.: po',.rs in the 1,gr8c- ment which authorize the Bank to obtr.Ln any such member curr c.ncy as and when it ne"ds it, by borro"in';' i t fr om th.. mcmb.rr concerned,
In this ccnnoxi.on , hOViUV,-,T 9 t.h. .l;.grc<;;n,::-nt ahows a curt2in pr ud onc ce It limits the aggr,cgate amount of curr cncy tt-:, Bank may bo r-r ovr from 'ariy mombor- by such 10e,Ds to be cqui v"',l...;nt of
of th.; Bank, un l e s s the c iling is raised
its subscription to ths capital by the lending member itsolf.
lI
'I'hrs ; Lor.ns arc subject to be co-ordinlt d pith th .. ,,,onctcry policy of thG lending country. Thogh i t is t.ru. thct th max'imum "mount of the Loans , bsing .,quivc,lent to the me.mb,r's subscription At th.; most, will not by itself causa, c.v:n if d.r-avn arid s""nt all at oric o indntionary pr8ssurc on tho CCO',10lily of t.h. member cone rricd , thc:'e ar o othGr factors conc or ni ng its monetary policy -;·,bich n ocr.ssi t,"',tc s p oc La.I salc~,uctrd8. To s orvc fully this end, th ; Agreement p.r o v.i d cs 'th : t the member c o ncrr-n ed shall comply TTit~n the r,"quost of the Bank unlc.ss that m,jmbjr Lnvokc s economic difiicd tiGS ubich, in its opinion, arc lL,dy to be pz'ovok ed or aggravated by the granting of such a loan to t.h . Bank}J
The dur at Lor: of t.h . se loans is in relation to thct of th: pr oj octs for which th , cur-r-ency >!ill be, us ad ,
'I'ho s c loans bear interest paya'b.l o by the· Balli" t.h. rat of whi ch will be thG samG ~s th~ avcrag0 rate of intorast on all barrolling contracted by the Bank for its Sp,jcinl Funds during a p riod of one yeo.l' p"'eceding its bo rz-o m.ng from thG ffi<::,mbcr country , But at t h. S9,n1"" tim~:j t~J.8 rate will in no ",v'mt exceed a maximum rate; fixed by t.h , Board of Governors from time to time.
RJpayment of the loans end payment of int,rc.st due "ill be me.de in the currency of the Lcndi ng mdnb;jr or in a cur rcncy ac c opt ab Le to it.
II cr.
Article 24 (3) of the.:.JB Agre2J1lGnt11
Cf. Articlo 24 (2), ibide~E/CN.14/ ADB/30 page 21
OPERi.TIONAL POLICIES',lTD GENERAL CHARACTER OF OPER'"TIONS OF THE BANK
Furthering African Development
The Agreement eS,tabl,ishing th,e Afric"n Devolopment 'Bank provides that the Bank shall contribute to tho acceleration of economic dovelopment and so'cial progress of its momb.rr countric.s)J To accomplish this, the Bank shall promote the Lnvos tmcnt of public and private cap iLa.L in Africa:
use its o,m capital and funds obtnined in capital markets to make or guarantee loans or equity investments; encourage private investment in the member countries, co-operate with member countries towards a better utilization of their resourCGS by making their economies more complemen- tary and furthering the orderly grfMth of foreign trade; and, finally,
provide technical assistance in the prepar3tion, financing and implemen- ting of d ovc l opmorrt plans and pro j ccts •
.£!
It is thus clear that the Agreement is an instrument whioh permits great flexibility in thsoperation of the Bank and grants "ide scope for the d8termination of the Bank's policies. It permits the Bank to render assistance along the "hole gamut of economio development, from surveys of a country's eoonomy, preparation of loan requests and projects and'the training of personnel to thu granting or guaranteoing of credits or equity investm~nts.
In this respect, the: Bank is empClI7ered to deal with governments, African semi-official institutions, as well as with private entGrprise$.
The Bank may grant direct or indiroct credits; it may operate "lone, or in concert vi th other finC\ncial institutions or sources, and it can help to f'or-mulat.., projects and loan appLjcvt i on s , wh c th or for submission to the Bank i tedf or to other lending agenci"s)J
