100 Billion Dollars, No Peace: US Foreign Aid In Afghanistan

Afghanistan has been in a state of civil war since 1979, when Soviet troops invaded the country in support of the recently installed communist regime. Since then, more than 1 million have died in successive conflicts. When the United States intervened to overthrow the Taliban in 2001, it had ambitions to end the cycle of violence and build a stable democracy. To this end, the US government has spent more than 100 billion dollars in foreign aid to Afghanistan—nearly the same amount given during the Marshall Plan to rebuild Europe following WWII. The government’s hope was that this money would allow the country to reach self-sustainability when NATO troops withdrew.

Afghanistan, however, remains dependent on foreign forces and funding. The Afghan Government controls less than two-thirds of the country, while the Taliban’s territory has expanded to its greatest extent since the 2001 US-led intervention, according to the Institute for the Study of War. Recently, the Islamic State has also built a presence. Media attention was briefly refocused on the country in April when the US dropped the largest non-nuclear bomb it its arsenal—the MOAB—on an IS tunnel network. However, Afghanistan’s problems go beyond its vast security challenges. The Afghan government has been largely unable to provide services to most of the population. Its GDP is increasing at a slower rate than its population, and it ranked seventh to last in Transparency International’s 2016 Corruption Perception Index. What went wrong?

Many of the failures of aid seem to rest on the manner of distribution. Rather than supporting development, US aid has focused on short term projects in conflict stricken areas of Afghanistan. Aid is overwhelmingly distributed to the regions with the most conflict. Bamiyan and Daikundi, the most secure provinces since 2001, are now also the poorest and least developed. These provinces are home to the Shiite Hazara ethnic group, who have long suffered from discrimination and ethnic cleansing, especially during Taliban rule. The instinct to win public support in areas with a heavy Taliban presence is logical, but it has had significant consequences for long-term development and peace.

More than 80% of aid has gone towards short-term projects designed to improve local security, such as walls around schools, repairs to local irrigation infrastructure and police checkpoints. While these projects have absolutely done good—improving food security and aiding local education—long-term economic development and institution building have been neglected at the expense of aiding the security operation. So, when NATO troops began to pull out in 2011, economic growth plummeted from well over 10% to just 2% and the poverty rate increased from 36% to 39%. Sustained economic development would help the Afghan government collect revenue, provide services, and decrease its dependence on foreign aid. Though, Kabul’s revenue collection capability, which remains low at just 10.7% of GDP, according to The World Bank, will need to improve.

Not only has US aid failed to build a sustainable future for Afghanistan, the evidence suggests that it has failed its primary objective: demonstrating the benefits of supporting the Kabul government. An internal report produced by the US Agency for International Development (USAID) found that its stabilization program had the opposite of the desired effect. In Taliban controlled villages receiving aid, local opinion of the Taliban, rather than the US or the Afghan Government, improved. Villagers largely believed that the projects must have been approved by the local Taliban militia. Due to the complex networks of corruption, racketeering, and payoffs typical of building projects in the country, it is highly probable that some of this money has been funneled to the Taliban itself.

USAID had been justifiably reluctant to provide aid through the Afghan government. It suffers from widespread epidemic-level corruption. However, Afghanistan has consequently lacked the resources to combat that corruption and build local institutions. Until 2014, 90% of all aid was spent outside Kabul’s budget. Significant US aid was funneled through international corporations and multiple layers of subcontractors. This has led to inefficiency and higher overhead costs—in 2012 just 30 cents of every dollar USAID spent actually went to aid—about half the norm for other aid groups. Afghans feel disconnected from the money flowing into their country, neither their government, nor local communities received much input. In 2014, the US pledged to provide 50% of aid directly to the Afghan government. However, with the security situation deteriorating, the window to build a more effective Afghan state may have already passed.

In a situation as complex and difficult as Afghanistan, no solution can work perfectly, and any improvements will be gradual. However, there are a number of alternatives to the US aid strategy that may lead to improved outcomes. Aid could concentrate on long-term growth and institution building, for example, shifting focus to more secure provinces. For humanitarian reasons, aid to war-torn areas certainly shouldn’t ever be cut off, but the emphasis could change.

Additionally, when providing aid direct to communities, USAID could democratize the process and avoid the use of large international corporations. Rather than imposing projects based on what the population’s needs are believed to be, programs could leave decisions on what to build up to the local population. Locals could even be given the resources to complete projects independently. This buy-in could empower the local population and lead to better outcomes for use of infrastructure.

While the recent outlook has been negative, there are some points of progress. In March, Major General Mohammad Moeen Faqeer, a powerful military commander, was arrested for misuses of fuel and food supplies meant for his troops. His trial is seen as a test of Afghanistan’s law and order capabilities. If the countries leadership can continue to clamp down on corruption, improvement in government services and quality of life may be within reach.