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New BoT governor Benno Ndulu
2008-01-13 10:23:56
By Michael Mbiro and Anthony Madatta
The appointment of Professor Benno Ndulu as the new Governor of the Bank of Tanzania (BoT) has been greeted with enthusiasm by financial sector practitioners as well as the general public.
The distinguished economist points out however that although he is happy for being appointed the central bank chief executive, he is under no illusion of the big challenges ahead.
Winning back public trust as well as restoring multilateral lenders’ confidence, kick-starting economic initiatives free from external directives and nurturing skills and talents of the young and the best brains at BoT are among the new governor`s immediate priorities. Staff writers Michael Mbiro and Anthony Madatta interviewed him.
Question: How do you plan to put things back to order, following your appointment as the new Governor of the Bank of Tanzania?
Answer: First and foremost I would like to express my sincere gratitude to the president for his confidence in me and in picking me to become the BoT governor. I will do my best to ensure that all the tasks entrusted to me are implemented diligently.
We promise that we will give total support required in meeting the President\'s set goals.
Q: BoT is the leading financial institution in the country. How well prepared are you in tackling the challenges ahead of you?
A: There are three major issues which we need to deal with. The first task is to get rid of the tarnished image of the institution and nation. We are going to ensure that all the issues outlined in this report will be dealt with accordingly.
As a team, our second target is to ensure that the nation realises sound economic growth and prosperity and bring down inflation and the high interest rates.
In the meantime, the banking and finance sectors are making remarkable progress in executing and delivering the services as well as in modernisation.
Most of the banks in the country are applying advanced banking technologies and are networking very well with other banking institutions worldwide.
As the banking industry and other financial institutions advance, the Central Bank, which plays a supervisory role, is duty-bound to keep pace with the developments so as to execute our roles accordingly. The bank’s staff team must be conversant with all banking technological development taking place.
Q : Before your appointment, you were one of the two deputy governors of BoT. What burning issue that haunted you most which you want addressed immediately?
A: One of the issues before us is to ensure that we work tirelessly in ensuring that the national economic growth proceeds faster without (waiting for) pressure from the International Monetary Fund (IMF) or instructions from the World Bank. Economic growth should (be pursued) through our own initiatives, desire and will.
Secondly, there have been a lot of good things executed by the central bank. It has been bad luck that problems faced by the financial institution have received more prominence and (and coverage) than the many good things it has done.
Therefore, one of the things I am planning to do is to increase transparency so that the general public is well informed on all the developments taking place in this financial institution.
Where we commit mistakes we will be ready to be faulted, rectified and where we excel in performance, we should deserve a pat on the back.
I do believe that transparency is the greatest enemy of corruption and if we give it due importance, it is obvious corruption will be stamped out.
Q: The President has directed the BoT Board of Directors to meet with immediate effect to deal with the 133bn/- scandal. When are you planning to meet?
A: We will meet next week. Right now we are scrutinising the report, to examine those implicated in the scandal, to work out the right procedures so that we do not commit mistakes or flout procedures that might land us in court.
We will meet in Zanzibar on January 17, this year in our normal session and the submitted report on the 133bn/- will be one of its top agenda.
Q: You have already indicated plans of house cleaning. To be more precise, what actually are you planning to do? How dirty is the house?
A: Well, you know we have reports that have already been completed; you know there is ongoing work and the Prevention and Combating of Corruption Bureau (PCCB) is working...and we are providing them with as much information as possible and they are doing their part. We will have to base our house cleaning on the findings that have come out.
One thing we want to be absolutely clear about: we will be firm but also we will be fair. We wouldn’t want to victimize anybody on the basis of the conclusions that are not carefully considered.
So how dirty the house is, is based on the report and we do intend also to do some additional baseline reviews just to see what else needs to be done. This particular report was just the beginning of a much broader look.
Q: Mr Governor, how do you treat the Shs 133bn/= scandal, the biggest ever in the history of BoT? Does this spell lack of professional efficiency in the institution?
A: Well there are two sources to a problem like this. One definitely is personnel …..even if you have systems in place, this can happen. The important thing is that when it happens, people do know that it has happened and investigations can be done and those responsible are dealt with appropriately.
But we know also there may be systemic issues and this report has also raised some of these questions and we do hope actually to have a more in-depth look at some of the systemic questions that have been raised and we are going to do some safeguard assessments subsequently just to make sure that all that needs to be fixed is fixed.
Q: To the surprise of many people, the theft of this money was revealed by the opposition camp leaders and thereafter the government was forced to set up an investigation team on the matter. Why has it been so? Does this mean the government had no clue at all on this scandal taking into account BoT has adequate experts?
A: Well as far as I know, the first time this issue came up, was well before the discourse that came into the papers subsequently on the political side. It all began in the context of doing an audit of this institution as you know.
And these questions were subsequently taken up within that framework. I do recall clearly that when the government took up this matter, it had initially decided precisely on what process to follow to make sure that there is an investigation.
Subsequently, I think it was picked up once it came into public knowledge by other segments of this society. So, I think the system did work in the sense that in the course of all this, this information had to come through.
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