Ndulu: Man who transformed the Bank of Tanzania

Tuesday February 23 2021
Ndulu pic

Former Bank of Tanzania Governor, Prof Benno Ndulu.

By Samuel Kamndaya

Dar es Salaam. The death yesterday of former Bank of Tanzania (BoT) Governor, Prof Benno Ndulu, 71, has robbed the country of a transformative, principled and transparent individual who always stood by what he believed to be right.

History will remember Prof Ndulu as a highly qualified technocrat who completely changed the face of the central bank in the eyes of Tanzanian pundits.

Prof Ndulu became BoT Governor at a time when the reputation of the country’s financial regulator was tainted by the the infamous External Payments Arrears (Epa) scandal.

After a public outcry over usage of money meant for clearance of swelling import bills, the Controller and Auditor General (CAG) sub-contracted Ernst & Young to investigate the matter and came up with a revelation that $133 million had been stolen by 22 firms through the Epa sovereign account during the financial year 2005/06.

Backed by the auditors’ findings, which confirmed financial irregularities in the Epa account, former President Jakaya Kikwete fired the then BoT governor, (the late) Dr Daudi Balali.

Upon becoming Governor in 2008, Prof Ndulu worked tirelessly to rebuild the BoT’s damaged reputation.


He personally held briefings with the media routinely. The phone number of a BoT Governor was no longer a seriously guarded secret to all serious senior journalists during Prof Ndulu’s tenure.

In fact, many senior business and economic journalists still have Prof Ndulu’s phone number despite his passing on yesterday.

Travelling abroad was nothing to bar Prof Ndulu from picking a journalist’s phone call and explaining any point that needed his input for the general good of Tanzania’s economy.

Prof Ndulu will be remembered for managing to defeat several attempts by politicians to interfere with the BoT’s operations.

Even during the days of the Tegeta Escrow Scandal, Prof Ndulu remained firm. He refused to be manipulated for the benefit of a network of powerful politicians and some unscrupulous businesspeople.

He was on record as having raised queries to the Attorney General over the legality of transferring $122 million from the Tegeta Escrow Account at the BoT to the account of Pan Africa Power (PAP) Solutions at Stanbic Bank.

The BoT, under Prof Ndulu, also demanded evidence that IPTL and Tanesco had resolved the dispute on capacity charge - which ended up with the two parties going for arbitration in Washington, DC.

Prof Ndulu further questioned the legality of the transfer of 70 per cent of IPTL’s shares from Merchmar to PAP, given that there was no record at the Business Regulatory and Licensing Authority (Brela) showing that the acquisition was approved and registered as required by the law.

These tenets did not go unnoticed. It was not surprising therefore that on October 13, 2015, Prof Ndulu was named as Africa’s Best Central Bank Governor and awarded.

Even after his retirement, Prof Ndulu was on September 27, 2019, appointed by South Africa’s President Cyril Ramaphosa, as a member of the new Presidential Economic Advisory Council.

That was followed by a latest appointment whereby Ethiopia’s Prime Minister Abiy Ahmed named Prof Ndulu as his a member of his Economic Advisory Council at the recommendation of the Governor of the Central Bank of Ethiopia, Dr Yinager Desse.

Even during his days as a university don, Prof Ndulu undertook a number of academic works that made important contributions to the economic reforms that were implemented in the second half of the 1980s. When he was later hired to work as Lead Economist with the Macroeconomic Division of the World Bank for Eastern Africa from the Tanzania Country Office, Prof Ndulu was involved with former President Benjamin Mkapa’s reform agenda which is credited for building Tanzania’s sustained economic growth momentum.

Financial inclusion architect

Analysts describe Prof Ndulu as an architect of financial inclusion.

“He (Prof Ndulu) believed in financial inclusion. He believed that for the economy to grow, every individual must be involved in any form of a formal financial service,” said TPB Bank Plc chief executive officer Mr Sabasaba Moshingi.

His Standard Chartered Bank Tanzania counterpart Sanjay Rughani shared similar sentiments, saying Tanzania, the entire African continent and the indeed the world had lost an incredible visionary leader who nurtured and impacted many individuals and economies.

“Prof Ndulu, who championed financial inclusion as well as the agenda of ensuring sound macroeconomic management, was also well recognized for his significant contributions to capacity building and research in Africa….Known for his pragmatic and rational approach, he was immensely respected by us bankers, his peers internationally and by the private sector too,” said Mr Rughani.

Mr Rughani, who doubles as deputy chairman for Tanzania Bankers Association (TBA) and chairman for CEO Roundtable, said Prof Ndulu was an advocate of capitalizing on technology as a significant enabler to leap frog the economic transformation.

“He was keen to take measured risk to let innovation run ahead of regulations - he used to say as a regulator we need to test, learn and then regulate for positive progress and prosperity,” he said.

CRDB Bank Plc chief executive officer and TBA chairman Abdulmajid Nsekela described Prof Ndullu as a sagacious economist and a shrewd financier who contributed immensely to Tanzania’s economic growth, wealth creation and financial stability.

“With his savoir faire and dedication, Tanzania attracted huge foreign investment…..The banking sector has lost a guru who contributed immensely to the economic reforms implemented in the late 1980s that lead to the liberation of the financial sector in Tanzania,” he said.

Path to prosperity

Following his PhD Degree in economics from Northwestern University in Evanston, Illinois, Prof Ndulu taught economics and published widely on growth, adjustment, governance and trade.

In his latest book, which was published in October 2017, Prof Ndulu emphasized that Tanzania will have to increase value added to agriculture if it was to yield meaningful development.

Prof Ndulu writes in a book titled Tanzania: The Path to Prosperity that the country must undertake several major reforms if it is to grow the economy and achieve the middle income status in line with the country’s development vision.

In a chapter he co-authored with a senior economist at the International Monetary Fund (IMF), Ms Nkunde Mwase, Prof Ndulu also urged Tanzania to utilize natural resources to stimulate heavy industrialisation and labour-intensive manufacturing sector while also paying special emphasis to promotion of service-based industries as well as investing in infrastructure and in human capital.

The book was published in October 2017 is co-edited by Prof Ndulu, Christopher Adam, who is a Professor of Development Economics at the University of Oxford and Research Associate at the Centre for the Study of African Economies, as well as Paul Callier, Professor of Economics and Public Policy at the Blavatnik School of Government at the University of Oxford.

One of the key arguments in the book is that focusing on agriculture would have a high impact on poverty alleviation.

Similarly, government’s efforts must be directed towards improving incentives for increased production. This, the authors argue, would entail improving rural infrastructure to increase physical access to domestic, regional and international markets.

Establishing of viable agro-processing industry also appears high in the author’s plea for value added agriculture. It is a viable agro-processing, according to them, that will eventually boost the returns from the sector and support entrance into regional and global value chains.

“This will entail an education policy that bolsters human capital and also an agricultural policy initiative that supports a move up the value chain, including through enhancing linkages with the domestic economy – for example, the tourism sector,” the authors say.

Additional reporting by Gadiosa Lamtey