Statement

by Praful Patel Vice President for South Asia, The World Bank at the Meeting of the North Atlantic Council in Foreign Ministers session on Afghanistan

Excellencies, Ladies and Gentlemen

The World Bank is honored to be invited to this meeting. It has been said before and I will say it again: there is no security without development and no development without security. Integration of security, governance and development was the basis of the Afghanistan Compact signed in London a year ago.

The World Bank, as the international community’s global development institution, is playing its role at the forefront of the rebuilding of Afghanistan. This is a country that faces formidable challenges of reducing poverty, creating modern institutions, dealing with insecurity and phasing out drug production. Any one of these challenges alone is difficult enough for any poor country; having to succeed at all of them is a huge task that requires an extraordinary and sustained effort.

Our experience over the past 60 years has produced some lessons for the task in Afghanistan:

First, development is much more that just projects. It involves the transformation of societies and the building of local institutions. Afghans are trying to build in decades what Nato member countries took centuries. We can expect to be engaged in development work for at least twenty or thirty years.

Second, although development is a long term process, it doesn’t mean that much cannot be achieved in the short term. One of the challenges for Afghanistan is to strike a balance between short term interventions that sustain the hope of Afghans, and development assistance that promotes Afghan institutions.

Third, ownership of the Afghan government and people in stabilization and development is critical to its success. Essentially we are engaged in a competition for the minds of Afghans. It is tempting to assume that what works in our countries will work for them and be appreciated; and that they can be won over by projects. The evidence is that externally driven development does not work. The future will be determined by Afghans taking what we have to offer, adapting it to their own conditions, and assuming responsibility for implementation.

Fourth, our interventions must support the demands of the Afghan people, even if it is second best. We should empower the Afghan people to articulate what they want. We should not create aid dependency which inflates expectations that the international community can never meet.

Has this been forgotten and are we repeating the problems faced after the Taliban collapsed? In response to the then crisis of famine, lack of government capacity and desire for a “peace dividend,” there was an expansion of quick impact NGO and UN projects. These projects often failed to achieve scale, were high cost, and sometimes did not meet Afghan priorities. Externally designed aid coordination structures collapsed under the weight of Afghan nationalism. Organizations that had saved the lives of thousands at one of the worst times in Afghan history, were criticized by Afghans for wasting foreign aid and undermining the authority of the state.

Even today, more than two thirds of development assistance is outside the government budget. Donor driven, parallel, channels of aid delivery are high cost – government officials tell us that PRT schools may cost four times the cost of schools built under the Afghan National Solidarity Program – and undermine the capacity of the state by taking away skilled civil servants and prevent learning by doing. Parallel programs may not be financially sustainable, and weaken the accountability of the state to its citizens.

Indeed, there is also some evidence that projects built with participation of local human and financial resources are more resistant to insurgency. Schools built under the National Solidarity Program have been protected by their communities, whereas schools transplanted by donors have been burned.

Related to this are some questions on the role for PRTs. The new US Army field manual on counter-insurgency is quite clear:

“In (counter-insurgency) it is always preferred for civilians to perform civilian tasks. Whenever possible, civilian agencies or individuals with the greatest applicable expertise should perform a task. Legitimate local authorities should receive special preference.”

Yet are PRTs evolving into a key means for delivering development assistance? There is clearly a role for PRTs in areas of great insecurity. However, the Afghan government has demonstrated its ability to deliver services even in provinces that are affected by insurgency. Programmatic approaches that can be scaled up exponentially such as the National Solidarity Program, which now covers 17,000 villages in all 34 provinces, microfinance, the program for delivery of the Basic Package of Health Services, and the National Rural Access Program, have demonstrated that Afghans can achieve quick results. The government is seen to deliver services, citizens are connected to the state and hold government accountable for results.

We also need to question whether we are promoting projects without developing the institutions which will sustain them. Projects which are not designed for Afghan conditions, or which fail through lack of people to run and maintain them, do not bring credit upon the international community.

A large part of what the World Bank does in Afghanistan is designed to support the development of state institutions and a reformed public administration. However, this will succeed only if corruption and the links between government and criminality are confined. Defeat of the insurgency will require, above all, clean government that delivers personal security and protection of property. This will not only commit Afghans to their state, but also create conditions for private investment in the formal economy.

Finally, I would like to discuss the coordination of international assistance to Afghanistan. Part of the problem arises from inefficient, parallel channels of aid delivery that I referred to earlier. The sovereign Afghan government is the only institution with the legitimacy to coordinate aid. The Paris Declaration on Aid Effectiveness, which most of the countries represented around this table have signed, sets out clearly what needs to be done. The more fragmented aid becomes, the more difficult it is to coordinate.

The World Bank is willing to play its role in helping government to strengthen budgetary systems to enable donors to provide assistance on-budget or through the Afghanistan Reconstruction Trust Fund which we administer. We are also supporting coordination, particularly through our technical analysis that helps resolve issues, fewer meetings and a focus on results. We especially welcome the links established under ISAF Nine to enable a productive dialogue on security and development issues. Nevertheless, there are issues that remain to be resolved, particularly the relation of security sector and civilian salaries, and the degree to which security expenditures can be transferred to the government’s core budget.

Thank you once again for the privilege of attending this important meeting.