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Donors criticised

by Claudia Isabel Rittel
A recent study maintains that only a frac­tion of the aid promised for the reconstruction of Afghanistan actually makes it into the country. Payments often lag behind the pledges. Meanwhile, the donors criticise the Afghan government’s in­adequate efforts to raise taxes.

According to a recent paper by the non-governmental umbrella organisation ACBAR (Agency Coordinating Body for Afghan Relief), donors do not disburse a large portion of the aid money they promise. ACBAR refers to statistics from Afghan government, according to which the international community has pledged $ 25 billion for the reconstruction of the country since 2001, whereas only $15 billion were actually made available. In the ACBAR paper, Spain ranks particularly poorly with a disbursement rate of around 13 % of commitments. Germany was said to have transferred almost two thirds and the USA 40 %. International aid payments make up approximately 90 % of Afghanistan’s national budget.

Germany’s Development Ministry (BMZ) disputes the ACBAR figures on German aid, however. Press spokesman Markus Weidling says he finds the data obscure. According to him, BMZ pledged a total of € 530 million for the years 2001 to 2006, and 90 % of that sum (€ 491 million) has already been disbursed.

The 94 national and international member organisations of ACBAR claim, moreover, that too much money is being wasted, as 40 % of the funds flow straight back to the donor countries. On the one hand, this is attributed to salaries for foreign experts, who receive $ 250,000 to $ 500,000 per annum. However, another reason given is that half of the donor funds are granted on the condition that services and materials are procured in the donor country. On top of this, ACBAR bemoans enormous logistics costs (satellite telephones, vehicles and security).

According to the study, the ratio of military spending to reconstruction assistance is completely disproportionate. While the USA alone is said to spend $ 100 million a day on the military mission, all the donors combined invest only seven million dollars a day in reconstruction. Furthermore, this money is said to be distributed too unevenly. ACBAR complains that insecure provinces benefit most from additional funds, which creates completely distorted incentives.

In the NGOs’ view, it is also problematic that the Afghan government has no say over the large share of aid that is administered by the World Bank’s Afghanistan Reconstruction Trust Fund (ARTF). It serves to finance the Afghan government’s operating costs, such as salaries for teachers and judges, for instance, as well as reconstruction projects. According to ACBAR, ARTF is undermining the development of fully operational state structures, especially at the local level.

Poor coordination among donors is said to be aggravating the situation further – primarily due to disputes over the respective areas of responsibility and competition for the best projects. According to the study, “too many projects are designed to deliver rapid, visible results, rather than to achieve sustainable poverty reduction or capacity-building objectives”. After all, governments want to sell the projects as success stories to their voters. Barbara Unmüßig, co-president of the green-leaning Böll Foundation in Germany, bemoans the setting up of coordination committees to remedy the shortcomings with the ultimate result of over-coordination.

Some of the Afghan government’s affairs are in a sorry state too. In late March, Anwar Ul-Haq Ahady, Afghanistan’s finance minister, had to admit that his country will not honour an agreement with the International Monetary Fund (IMF) to raise the equivalent of € 458 million in taxes. Economists do not consider the goal to be particularly ambitious. Meanwhile, the World Bank and other donors have also rejected Afghanistan’s National Development Strategy, on which future aid and $ 10.6 billion in debt relief under the HIPC initiative depends.

Claudia Isabel Rittel