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CBJ 2006
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Afghanistan

Budget Summary

Flag of Afghanistan

Please note: All linked documents are in PDF format

Objective SO Number FY 2004 FY 2005 FY 2006
Agriculture and Alternative Livelihoods 306-001 50,500 95,690  
Basic Education and Health 306-002 187,555 70,725  
Infrastructure, Economic Governance & Democracy 306-003 820,818 245,085  
Program Support 306-004 20,507 15,500 48,000
A democratic government with broad participation 306-XXX     40,000
A thriving economy led by the private sector 306-YYY     412,000
A better educated and healthier population 306-ZZZ     122,800
Total (in thousands of dollars) 1,079,380 427,000 622,800

Excludes P.L. 480. See Program Annex.

The Development Challenge: USAID opened its Mission in Afghanistan in 2002 in response to pressing humanitarian needs confronting the country following the removal of the Taliban regime. Between 2002 and 2004, USAID transitioned from an emergency response to a developmental approach, focusing assistance on sustainable, capacity-building activities that support U.S. interests in a stable, self-sufficient nation. Now, following the first national democratic elections, development support to Afghanistan remains at the center of U.S. strategic national interest. President Bush's National Security Strategy pledges that the United States will provide assistance to “rebuild Afghanistan so that it will never again abuse its people, threaten its neighbors, and provide a haven for terrorists." In support of this pledge, the State Department and USAID have developed a joint strategic plan that specifically provides for continued commitment of assistance to Afghanistan as a priority.

Afghanistan enters its third year since the fall of the Taliban and the end of 23 years of civil war with optimism and hope for a bright future. The most important development in the post-Taliban era occurred this past October with the completion of highly successful Presidential elections in which over eight million people voted, with over 40% of voters being women. The peaceful election was a major statement by the Afghan people that they are ready to choose new leadership that will focus on rebuilding the country. Because Afghanistan is in the front lines of the war on terror, the U.S. Government (USG) and USAID in particular are in a unique position to respond with appropriate programs to create new opportunities for this deserving population. The USAID Mission in Afghanistan plays a key role in the reconstruction and development of the country and works closely with other USG agencies, including the military, on program development and implementation.

Despite remarkable progress in such a short time, much crucial work remains in order to provide Afghans a more stable and productive life and an antidote for terrorism. Many social and economic indicators continue to be the worst or close to worst in the world. The under-five infant mortality rate is 172 per 1,000, and maternal mortality is 1,600 per 100,000. Infectious diseases continue to constrain the ability of many Afghans to contribute to the rebuilding of their society. Malaria and tuberculosis affect thousands of Afghans each year, and Afghanistan is one of five countries that still has the wild polio virus. Many Afghan children, particularly girls, do not have access to education. The agriculture sector, which makes up well over 60% of the Gross Domestic Product (GDP), is hampered by a lack of market access. The growth of poppy threatens the long-term stability of Afghanistan and undermines the legitimate economy. Many obstacles to economic investment and growth remain, and unless friendlier private sector rules and regulations are adopted, the country will not be able to keep up its current rate of GDP growth. In addition, Afghanistan’s ruined infrastructure continues to impede economic growth. The rule of law is inconsistent, and local governing bodies employ questionable methods of dealing with crime. NGOs and civil society could contribute significantly more to the country’s economic growth.

The most important and continuing constraint to USAID programming, as well as private sector investment, is the security situation. The country remains a high threat post, and security considerations often constrain USAID’s ability to implement and monitor projects throughout the country. While the security situation is difficult, USAID believes that the Government of Afghanistan (GOA) and the large majority of the Afghan people appreciate USAID and want the Agency to continue its work.

The USAID Program: USAID/Afghanistan is requesting FY 2005 and FY 2006 funds for three strategic objectives and one program support objective. These objectives are focused on providing support to Afghanistan's transition from a failed state to a stable, productive nation. Areas of support include: economic growth, particularly economic policy and regulation and expanded rural incomes; access to basic health services particularly for women and children; increased access to basic education; and the growth of democratic practice through support to elections, media, and civil society. FY 2005 funds will be used to implement the ongoing programs in agriculture, basic health and education, infrastructure, economic governance and democracy, as described in the FY 2005 Congressional Budget Justification (CBJ). In FY 2005, USAID will also initiate a new program providing alternative livelihoods options to poppy cultivation. The specific activities to be funded by FY 2005 and FY 2006 appropriations are described in more detail in this year's CBJ.

Despite remarkable progress in a short time, much work remains to rebuild the country's social fabric and infrastructure and chart a successful transition to democratic self-rule. Transition Initiatives (TI) funds will provide the necessary resource flexibility to support economic and political transition in Afghanistan, where political and economic conditions remain volatile. USAID requests TI resources in FY 2006 to:

  • support economic growth by expanding rural incomes, improving access to economic and social infrastructure, and assisting with economic policy and regulation reforms;
  • improve access to basic education;
  • provide alternative livelihoods options to poppy cultivation through small business development, public works and infrastructure support, production of competitive agricultural products, and greater public access to credit and financing institutions; and
  • strengthen public and private institutions necessary for democratic governance through enhancing capacity within the justice sector, supporting decentralization and local government, and strengthening civil society.

Other Program Elements: In addition to the activities described in the CBJ, USAID's Democracy, Conflict and Humanitarian Assistance Bureau (DCHA) provides support to development and humanitarian response programs. During 2004, food for peace support from DCHA was approximately $49,158,400 and provided 79,330 metric tons of commodities to the United Nations (U.N.) World Food Program for development and humanitarian relief programs. These activities and resources benefited over five million individuals. DCHA provided an additional $9,896,870 in foreign disaster assistance during FY 2004, including more than $4.7 million in transitional shelter assistance, approximately $3.6 million towards winter programs, such as snow clearance and road rehabilitation, and $1 million for assisted returns of refugees.

Also, in FY 2004, $22,732,244 from DCHA was used to continue to build citizen confidence in the political development process, empower citizens to address basic community needs, and build an alliance between legitimate government structures and citizens. DCHA's rapid and flexible support for activities central to Afghanistan's transition also helps establish credibility and space for longer-term development assistance.

Other Donors: The top three donors are the United States, Japan, and the European Commission with the Government of Afghanistan (GOA) leading overall donor coordination through a system of Consultative Groups (CG). The Minister of Finance leads the core CG, which is composed of high-level representatives of each donor country, as well as representation from U.N. agencies and Afghan ministries. In addition, there are 13 technical CGs that focus on specific areas such as health, education, and economic growth, which are attended by representatives of key donors and ministries for each sector. In coordination with the CG process, the GOA has established the Donor Assistance Database which tracks reconstruction activities by donor and supports the implementation of the National Development Budget.

The Afghanistan Reconstruction Trust Fund (ARTF), administered by the World Bank, provides a consolidated funding mechanism to permit the GOA to fund projects and programs. USAID has contributed $147 million to the ARTF, including $89 million in FY 2004. The ARTF provides a convenient mechanism through which USAID can provide support to the GOA, including direct support to recurrent costs such as salaries and operation of key government buildings, as well as special projects and investment programs. As the World Bank manages the ARTF, it meets the USG's criteria for accounting standards and allows USAID to closely monitor the use of U.S. taxpayers' funding for support to the GOA.

In addition to GOA-led coordination meetings, USAID meets directly with donor and U.N. representatives to discuss coordination of development activities. Through regular consultation with key donors, USAID is able to gauge the needs for support in critical sectors, as well as identify areas of unmet need.

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Tue, 14 Jun 2005 16:03:55 -0500
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