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Afghan aid "wastage" under the spotlight at London conference

30 January, 2006

KABUL: Hefty salaries and commissions, overpricing, corruption these are eating chunks out of the billions of aid dollars that have flooded into destitute Afghanistan in the past four years, officials say.

The issue is souring Afghans’ attitude towards the country’s substantial foreign aid community and is set to be a key topic of next week’s London conference between the government and its donors.

"In Afghanistan the wastage of aid is sky-high: there is real looting going on, mainly by private enterprises. It is a scandal," says World Bank director in Afghanistan Jean Mazurelle.

"In 30 years of my career, I have never seen anything like it." Mazurelle estimates that 35 to 40 percent of the aid to this war-shattered country is "badly spent."

"We would do better by improving the way we spend the aid than by increasing it," he said. The government finance ministry agrees. "Forty percent of the aid could be used more efficiently," an official there says.

Part of the problem is that there are no controls on the roughly 10 billion dollars in reconstruction aid that has been sent to Afghanistan since the ouster of the fundamentalist Taliban in late 2001, Mazurelle says.

"There is no gate keeping and the Afghan government, which only handles a little of this aid, cannot object," he said. The aid has had some results.

It has allowed, for example, the retiring of 1,740 kilometers (1,078 miles) of roads and helped 13,000 villages under a government development project called the National Solidarity Programme.

And it has put six million children in school and accommodated four million refugees who have returned from exile mainly in Pakistan and Iran, according to the United Nations.

But in the far-flung provinces, countless badly constructed or incomplete houses and clinics are testament to shoddy workmanship.

And reconstruction is generally agreed to have been slow, with residents of even the capital Kabul getting only a few hours of city power every two days.

The reconstruction has been "extremely limited" in the provinces, a UN official admits. "The donors subcontract to the NGOs (non-governmental organisations), which then subcontract to businesses or local NGOs, which sometimes mess up the work," he said.

"Admittedly it is difficult to find trained Afghans able to handle the projects. But there is also no international control downstream."

The finger is in particular pointed at the United States, which favours US firms for its projects.

According to the Washington Post, US construction company Louis Berger has built or renovated 533 buildings, including clinics and schools, at an average cost of 226,000 dollars each.

The Afghan government could have done the job for 50,000 dollars a unit, the paper said.

The aid to Afghanistan is also spent on maintaining the army of foreign aid workers who have temporarily put up base here.

It is "wasted on high salaries, large overheads, luxury cars, luxury houses ... that Afghanistan cannot afford at all," President Hamid Karzai said this month.

The plethora of international consultants placed in government and non-government offices -- with mixed results -- take between 15 and 25 percent of the total aid, according to estimates.

And the cost of protecting expatriates living in the insurgency-hit nation takes another 30 percent, which goes to mostly foreign security firms.

Some of the aid pledged to the country is also used to maintain head offices in faraway capitals.

"For a contract of 45 million dollars recently given to the FAO (the UN’s Food and Agriculture Organisation), four million has to go towards financing its headquarters in Rome," a European official said. "In the end, there isn’t much left for the Afghans," Mazurelle said.

The issue will come under the spotlight at the January 31-February 1 meeting in London between the Afghan government and its 70 donor nations and various aid organisations.

A five-year development plan, called the "Afghanistan Compact", to be signed at the meeting, includes an entire annex on "improving the effectiveness of aid."

The text calls for transparency and accountability, and for the government to take the lead in setting development priorities, but does not impose any demands on the signatories.

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