State and USAID: Core Budget

The core U.S. goal in Afghanistan remains to disrupt, dismantle, and defeat al-Qaeda, and to prevent its return to Afghanistan. Although the United States is transferring responsibility for security to Afghan security forces by 2014, drawing down troops is not the same as disengaging. The civilian foreign assistance program contained in the FY 2013 request remains essential to support U.S. national security interests in Afghanistan and the region and to secure the gains won at such a high cost over the last decade.

At the December 2011 Bonn Conference, the international community endorsed Afghanistan’s vision of economic potential and regional integration and pledged to an enduring commitment described as the “transformation decade.” The enduring commitment made at Bonn reflects the unique challenges faced by Afghanistan and the extraordinary efforts made by the United States and international partners to stabilize the country over the last ten years. Afghanistan will remain a unique development challenge for the coming years and the FY 2013 request is the first indication of the United States’ continuing commitment. The Tokyo conference scheduled for July 2012 will further define international development assistance commitments to Afghanistan, and the United States intends to lead other nations to delivering significant contributions to the development of Afghanistan by pledging a portion of FY 2013 resources.

The United States has structured its partnership with Afghanistan to be sustainable, durable, and realistic in terms of funding levels. The overall FY 2013 request represents a more than $1.6 billion decrease from FY 2010, the high-water mark of U.S. civilian funding levels. Inherent in all programs is the recognition that assistance to Afghan institutions and society should be focused, effective, and sustainable. Programs have been reviewed to confirm that they increase Afghan ownership and capacity, contribute to stability, promote accountability, and are cost-effective. Results of assistance programs must be monitored and increasingly tied to measurable improvements. Focus is shifting from shorter-term stabilization projects to programs that more directly support the transition to Afghan-led development and strengthen the capacity of the Government of the Islamic Republic of Afghanistan (GIRoA) to manage its internal security, sustainably deliver basic services, and provide economic opportunities to its people. U.S. Government investments will focus on priority sectors that will lay the foundation for sustainable long-term growth and prepare Afghanistan for the potential economic impact of transition. Projects will focus on private sector development; strengthening rule of law and access to justice; building capacity at key levels of government institutions; finalizing key energy and water infrastructure investments needed for economic growth and revenue generation post-2014; strengthening the capacity of the GIRoA to manage and sustain previous investments in infrastructure and key industries; increasing regional connectivity and integration; and human capacity development to build the skills of the Afghans who will carry forward Afghanistan’s longer-term economic growth and development. Regional integration efforts are guided by the New Silk Road vision and the on-going regional discussion that is working to change the way Afghanistan relates to its neighbors to a more mutually beneficial and supportive paradigm.

The FY 2013 request is broken into two components. The first section is the core assistance to areas including economic growth, agriculture, health, education, rule of law, and governance, all areas critical to Afghanistan’s medium and long-term development. The second is Overseas Contingency Operations (OCO), which includes support for critical, immediate programs linked to remaining stabilization needs, as well as support for foundational investments and capacity building in key sectors.

The FY 2013 program emphasizes the desire to partner with the Afghan people for the long-term, an engagement underscored by the current Strategic Partnership negotiations aimed at defining U.S.-Afghan long-term security, economic, and social development cooperation. The United States is working with the Afghan government to support transition from donor dependence to a sustainable and resilient economy built upon private sector investment and growth. The process of transitioning security responsibility to Afghan forces started in July 2011, and now includes provinces and districts representing 50 percent of the Afghan population. Successful transition will require sufficient governance, development, and rule of law programming to buttress Afghan-led security. Essential to this will be successful elections in 2014 that will enable a peaceful transfer of power. The United States will provide critical assistance to support these elections to ensure the new government represents the voice of the Afghan people.

In coordination with international partners, U.S. assistance will support priority efforts to serve as anchors for this broader regional potential. One key to unlocking the promise of the Afghan economy is improved governance. Last winter, the United States developed a new economic strategy to organize its efforts that calls for a focus on viable sectors of the Afghan economy, greater emphasis on fiscal sustainability, and more action to improve the climate for commerce. Accordingly, assistance dollars will focus on developing operations and maintenance capacity to ensure the ability to sustain completed infrastructure; cement progress in health and education; enable the government to generate more revenue; and reorient stabilization programming to support the transition to Afghan-led development. The United States will maintain its goal of 50 percent of assistance provided through on-budget mechanisms with GIRoA, but that commitment assumes significant improvements in accountability and financial management within the various ministries.

FY 2013 programs will focus U.S. assistance on sectors and activities most likely to generate the jobs and economic activity needed to promote long-term growth and increased revenue generation. Over 80 percent of Afghans derive their incomes from agriculture and related businesses. Continued focus on this sector aims to generate reliable employment for the greatest number of people, as well as improving Afghanistan’s food security. The development of minerals and hydrocarbons is Afghanistan’s best chance to attract foreign investment and reduce its dependence on foreign assistance by generating significant revenue for the government in the long term. Completing key infrastructure projects in two high-impact sectors – power and water – is an important means to promote sustainable trade, commerce, and employment while integrating Afghanistan into the regional economy and attracting U.S. and other foreign direct investment. A carefully targeted program of building out and linking the country’s power grids will provide one of the key inputs for sustained economic growth.

Improved rule of law and access to justice are essential for long-term stability in Afghanistan. The primary focus for rule of law programs is to develop a sustainable Afghan capacity to investigate, prosecute, and adjudicate national security cases and major counter-narcotics cases, as well as operate an effective corrections system. FY 2013 program will also focus on improving access to justice and developing links between the informal and formal justice systems as more Afghans begin to interact with formal courts and informal justice shuras to resolve civil issues. To help the Afghan government provide its people with transparent, affordable, and effective dispute resolution mechanisms, programs will support rule of law initiatives at the district, provincial, and national levels focused on increasing access to justice, capacity building, and promoting transparency and accountability.

The advancement of women’s rights is critical to political, social, and economic progress in Afghanistan, where women’s human rights have been ignored, attacked, and eroded over decades, especially under Taliban rule. Many challenges remain, and the U.S. Government is committed to ensuring that women remain a cornerstone of U.S. policy efforts and programs. Afghan women must have a voice in making decisions about the future of their country.

As the United States transitions to an Afghan security lead and an enduring, strategic partnership, there will be challenges. For example, corruption, to the extent it is not adequately addressed, will continue to undermine the Afghan public’s confidence in the legitimacy of their government. Therefore, a main priority of governance, justice, and rule of law efforts will be to institute systems for transparency and accountability, and to empower Afghan institutions, both formal and informal, to check and balance one another in detecting and deterring corruption.

The civilian strategy in Afghanistan aims to strengthen Afghan ownership of their country’s future and undercut the appeal of the insurgency. This strategy recognizes that lasting stability and security go hand-in-hand with economic opportunity. It also recognizes the vital role of women and civil society in building a more stable country and in achieving lasting peace and reconciliation, and puts accountability and transparency squarely at the heart of all U.S. efforts.

Overseas Contingency Operations

The Overseas Contingency Operations (OCO) foreign assistance request for Afghanistan contributes to U.S. national security by supporting the U.S. Government’s efforts to disrupt, dismantle, and defeat al Qaeda in Afghanistan and Pakistan. Programs funded under this heading will help ensure a successful and durable transition of governance and security responsibilities to Afghan lead as well as prevent al-Qaeda’s return to Afghanistan by undermining the appeal of the insurgency, strengthening resilient and responsible Afghan government institutions, assisting with reintegration of insurgents, and laying the foundations for inclusive and sustainable economic growth. Programs will support reconciliation by providing economic alternatives to violence, creating opportunities for reintegrated persons to contribute to their communities in a positive manner, and improving the functioning of the legal system for dispute resolution. The OCO and core assistance requests for Afghanistan are carefully coordinated and together represent a strategic approach that is crucial to achieving U.S. Government goals.

The FY 2013 OCO request will fund a combination of projects working to maintain stability in key terrain and other critical districts while at the same time quickly building government capacity to take on increased responsibility after transition. The request includes continued funding for stabilization activities. However, increased emphasis will be placed on building the capacity of the government to identify and address drivers of conflict. One means of accomplishing this in FY 2013 will be to direct OCO funding through the Afghanistan Reconstruction Trust Fund (ARTF). The OCO request also reflects key investments in sectors and areas critical to transition and long-term economic growth, including investments in water and energy infrastructure. Energy programs will continue to receive OCO funding in FY 2013 to support investments in physical infrastructure critical to cultivating private sector growth, including a final push to link northern and southern electrical grids. This latter effort will also improve sustainability by increasing revenue collection. The OCO request will also support essential efforts in alternative livelihoods by providing farmers with economic alternatives to growing poppy, thereby ensuring their increased integration into the licit agricultural economy. In support of a sustainable political transition, OCO resources will also fund programs aimed at improving electoral processes and the environment for political debate to help the government of Afghanistan ensure credible presidential elections in 2014.

Other OCO resources included in the FY 2013 request will focus on reducing supplies of poppy cultivation and promoting alternative crops. The illicit cultivation of narcotics in Afghanistan fuels the insurgency and undermines stability throughout the country. Additionally, OCO funds will support the justice and corrections sectors by laying the groundwork for Afghan ownership and sustainable operation of law enforcement institutions and corrections facilities.

In FY 2013, the Department of State and USAID will continue to operate in a complex environment that requires close cooperation with U.S. and international military partners. Assistance programs, particularly those in OCO, are designed through close civilian-military cooperation to ensure collaboration and coordination of effort. Programs included in the OCO and core assistance budgets factor in and contribute to planning decisions related to programs like the Afghanistan Infrastructure Fund (AIF) and the Commander’s Emergency Response Program (CERP). The Department of State and USAID work closely with military colleagues to ensure that programming appropriately balances both short-term counterinsurgency objectives and longer-term development goals, while leveraging the capacity, skills, resources, and authorities of both USAID and the Army Corps of Engineers. (Source: Congressional Budget Justification FY 2013)