Development Initiatives vs.

Corruption and Fragile Security

in Afghanistan Rahat SIKDAR, Ph.D.

Afghanistan has been major site of concentration for international development partners since 2001. Continued high levels of corruption and bad governance have seriously frustrated the international community in their efforts to stabilize Afghanistan. Major reports revealed that millions of dollars that were allocated for the reconstruction and development of Afghanistan were misused or wasted.

There has been a clear shift in emphasis away from humanitarian aid towards spending on sector-allocable aid, notably aid directed towards social infrastructure and services, of which the largest share is for activities aimed at building the capacity of government and civil society. But it is vital need to pay attention to the type of growth pattern and its main drivers to transform its’ economies in order to foster economic growth and achieve the Sustainable Development Goals (SDGs).

Aid to Afghanistan by category, constant 2008 prices, US$ million (2006-2009)

$14,074

$79 $2,192

$298 $351 $153

ALL AIDSector allocable aid

Debt relief

Humanitarian aid

Commodity aid

General budget support

Other

Aid to Afghanistan by category, constant 2008 prices, US$ million (2006-2009)

$3,646

$963

$1,086 $12,025

SECTOR ALLOCABLE AID

Economic infrastructure and services

Multi-sector / Cross-cutting

Production services

Social infrastructure and services

$763 $815

$245 $238

$5,198

$1,120

SOCIAL INFRASTRUCTURE AND SERVICES

EducationHealthPopulation program and reproductive healthWater and sanitationGovernment and civil societyOther social infrastructure and services

Source: Development Initiatives based on OECD DAC CRS data

In 2000, the year before the war, Afghanistan was the 69th largest recipient of ODA worldwide, receiving 0.3% of total ODA flowing to developing countries. Between 2002 and 2009, US$26.7 billion in aid was spent in Afghanistan. By 2009, Afghanistan was the leading global recipient of official development assistance (ODA), for the second consecutive year.

Despite continued ODA facility and partnering through other development agencies poverty level remained worst in this country. Rampant corruption has been significantly uncontrolled in the government system. Aid effectiveness was questioned due to notable failure in the development initiatives that was mostly due to fragile security and corruption. Inequalities in the sub national levels were one of major failure caused the poverty level decreasing.

Afghanistan was recipient of aid from all donors US$ billion 4.9 in 2008 and 6.2 in 2009. 43.1% of the total US$62 billion pledged was disbursed to development projects and activities. Still eradicating extreme poverty and huger remained declining while it was measured 42% against baseline 33% in 2008. Therefore, accomplishment of MDG 1 was recorded difficult to achieve for Afghanistan.

According to the US Special Inspector General for Afghan Reconstruction (SIGAR), corruption remains one of the major impediments to the stabilization and reconstruction process in Afghanistan.

For instance, the poverty rate varies from 3.6 percent in Farah Province compare to 65.4 percent in Takhar Province. Similarly, the 2.8 percent calorie deficiency in Maidan Wardak province is significantly lower compared to 82.2 percent in Zabul Province. This scenario clearly points significant inequalities in the sub national levels.

The government is preoccupied with the country's worsening security situation, economic recession, and peace talks with insurgents, which have all but monopolized the its attention for the past several months. Nevertheless, the leadership must not lose sight of other important issues like systemic governmental failures and corruption. The Afghan government committed itself to enacting and enforcing a legal framework for fighting corruption.

Despite the less favorable external environment, the group of LDC economies attained an average real GDP growth rate of 5.6 per cent in 2013. On the contrary, annual GDP growth rate of Afghanistan was 3.9 % in 2008 and that of 3.2% in 2014.

2008 2009 2010 2011 2012 2013 20140

2

4

6

8

10

12

14

16

18

20

1.2

17.6

5.83.9

11.2

1.1 0.8

Real GDP per capita growth rate

2000-2008

2009 2010 2011 2012 20130

50100150200250

120.875.7

211.3

83.4 93.8 69.3

Foreign direct investment inflows US$ million

2000-2008 2009 2010 2011 20120

50100150200250300350400450

12

152

331247

385Migrant remittance inflows US$ million

Based the above data and information, following points are suggested for the attention of the government.

Real GDP per capita, foreign direct investment and diaspora remittance inflows continue declining all together over the recent periods. Domestic resources mobilization through remittance inflow should be considered at the highest level when most of the remittances are utilized in household purposes.

Continued political dilemma for a longer period would risk the state stagnant from all recoveries.

Sub-national level inequalities should be reduced through effective provincial coordination and strategic framework.

Combatting corruption should be in action rather in the sleeping chapter of the policy and should be prioritized to make all the development initiatives a success.

A responsible and accountable government - free from corruption and committed to promoting transparency and integrity across Afghan society - is the best weapon to deprive insurgents of their public support. Therefore, a multifaceted approach will be required to curb and control it.

ODA distribution (development assistances) should be more emphasized in curbing rampant corruption and fragile security which will lead other SGDs to be freed from stagnant.