The African Development Bank is facing renewed pressure from Washington after a confidential US Treasury report accused the institution of weak governance and rising fraud.
The report, prepared by the Trump administration in July, calls for sweeping reforms. It warns that future American support will hinge on “demonstrable improvements” in the bank’s procurement systems, oversight, and accountability.
Eighty-three per cent of cases sanctioned by the AfDB last year involved fraud, the report found. Kenya—one of the bank’s biggest borrowers—was identified as both a leading recipient of loans and a major source of corruption complaints.
“The United States will work with the new president to advance priorities, including reforming the bank’s procurement policies to ensure value for money,” the document states.
A new president under pressure
The findings land squarely on the desk of Sidi Ould Tah, Mauritania’s former economy minister, who assumes the presidency of the AfDB this week.
Elected in May with the backing of 72 per cent of African shareholders, Mr Tah promised to strengthen regional financial institutions and champion Africa’s independence in global markets. “I am fully aware of the responsibility and duty that come with it,” he said after his victory.
Mr Tah takes office at a critical moment. The AfDB is seeking to secure a capital increase to maintain its AAA credit rating, a move that requires American approval. The US, one of its largest non-African shareholders, has now made clear that its support depends on evidence of reform.
Kenya in the spotlight
Kenya, the AfDB’s fourth-largest borrower, has long relied on the institution to bankroll roads, power plants and water systems. Recent funding has included the Ethiopia–Kenya electricity highway, a flagship project meant to boost regional energy trade.
But bank investigators say Kenya has also become a hotspot for fraudulent activity. In August, the AfDB’s Office of Integrity and Anti-Corruption reported that corruption allegations were showing “a notable continuous trend.”
In response, the bank has tightened its checks. It has begun hiring outside experts to review bids from Kenyan companies before funds are released, a move aimed at closing loopholes. Several Kenyan firms have already been debarred, effectively excluding them not only from AfDB projects but also from contracts funded by other multilateral lenders such as the World Bank.
A difficult balancing act
For Kenya, the crackdown cuts both ways. Stricter scrutiny could delay vital projects in energy, transport and water. Yet a weakened AfDB—should it lose credibility with major donors—would threaten Nairobi’s long-term access to development finance.
Analysts say the country now faces a delicate balancing act: demonstrating its commitment to transparency while keeping crucial funds flowing.
The AfDB, founded in 1964, is one of the world’s largest development banks, funded by a mix of shareholder subscriptions, loan repayments and market borrowings. Its reputation for stability has long been a point of pride among African governments.
With Washington raising the stakes and a new president at the helm, the bank is entering a period of reckoning. What happens next will not only test Kenya’s resolve but also shape the future of development finance across the continent.
Neither the AfDB nor representatives of the Trump administration responded to requests for comment outside regular business hours.
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