Soludo Photo: Sun News Publishing

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President Umaru Musa Yar’Adua may have placed a final lid on the controversial African Finance Corporation (AFC) investment made by the Central Bank of Nigeria (CBN) during the tenure of erstwhile President Olusegun Obasanjo, with a directive that the recommendations and conclusion of the committee that investigated the matter be confined to the trashcan of history.

A presidential committee inaugurated by the Federal Government to investigate the circumstances surrounding the investment had reported that, the then CBN governor, Professor Chukwuma Soludo, acted beyond his powers and contrary to the CBN act in making the investment.

The committee made far reaching conclusions and recommendations to the president on the matter.
But in a letter dated January 21, 2009, and signed by his Principal Secretary, Mr David Edevbie, to the governor of the CBN, the president noted that with the government’s current stand on the committee’s report, the African Finance Corporation investment saga has now been put to rest, an indication that the out-going CBN boss may have been absolved of any wrong doing with respect to the contentious issue.

However, President Yar’Adua had advised the CBN leadership in the same letter to rectify all lapses identified in the committee’s report on the establishment of the AFC, stressing it should proceed with the investment, subject to the condition that it is seen as a catalyst for other private sector investors.
Moreover, the apex bank was directed to immediately initiate a divestment process that would reduce its equity holding in the corporation to a maximum of 10 percent, and to conclude the dilution procedures within five years.

The African Finance Corporation was established in 2007, as a private sector-led investment bank and development finance institution, created to mobilize and channel required capital toward driving Africa’s economic development.
Part of its objectives was to mobilize huge capital needed to finance infrastructural development in various countries on the continent.

The AFC project is believed to be part of an overall financial system strategy initiated by Professor Chukwuma Soludo, to facilitate Nigeria’s emergence as the Africa’s financial capital.
Other stakeholders in the project include commercial and central banks in various African countries that are also expected to contribute to its equity capital.
But its legitimacy was called to question shortly after the exit of President Obasanjo, leading to the institution of a probe panel by the Federal Government to investigate the $500 million investment in the continental investment platform by the CBN.

The agitated interests had faulted the project on alleged breach of due process by the leadership of the Central Bank of Nigeria prompting an inquiry into it.
At inception, erstwhile CBN boss was the chairman of the board, while Mr Austine Omoteruwa, who was sacked in the midst of the controversy was the founding managing director and chief executive.
Professor Chukwuma Soludo completed his tenure as CBN governor last weekend handing over to Mr Tunde Lemo, a deputy governor in charge of financial sector surveillance, pending Senate’s approval of Mr Sanusi Lamido Sanusi nominated by President Yar’Adua as substantive governor of the apex bank.