Afghanistan Development Goals 2014 and Beyond

[As Delivered]

Good afternoon and thank you for allowing me to speak today here at the New America Foundation.  I would again like to thank Anne-Marie Slaughter and Peter Bergen for having us here today. I am thrilled that Ambassador Samad was chosen to moderate what I hope will be an interesting and lively discussion on the role USAID will play in advancing development goals while simultaneously supporting our broader national imperatives in Afghanistan through 2014 and beyond.

If you follow Afghanistan in the media, you are bombarded with negative stories of corruption, violence, bitterness, and lack of hope. The media, and even some in the US government, would have you believe that 12 years of sacrifice and investment in Afghanistan is being squandered and will soon be lost, as that country falls back into civil war and chaos, or that USAID is shoveling money out the door to corrupt Afghans, as schools and hospitals crumble into money-pits unsuitable for human use.

My first message today is this: Don’t believe it; I don’t. I have both the opportunity to know, and a responsibility to pay close attention. I am not naïve. I know that our track record has not been perfect, and that Afghanistan’s future will not be easy, but we’re not working in Afghanistan because we expect it to be easy. We’re working in Afghanistan because it is important to our own national interests.

Afghanistan today is important to US interests for the same reasons that it was important to us on the eve of that horrible September 11^th in 2001. We know the dangers of turning our back on this part of the world.

The negative reports are easy to write. In a country as poor as Afghanistan, which is emerging from abject poverty and decades of violent civil war, it’s never hard to find a disgruntled farmer, a hungry child, a school that’s not fully constructed, or a hospital in disrepair. You also certainly don’t have to go to Afghanistan to find politicians making scandalous accusations amidst heated political challenges. As you listen to my prepared remarks and our panel, be skeptical; but also be skeptical of the nay-sayers. Hear them against a context of Afghanistan that is not pre-judged to be a failure, and where the peaceful desires and aspirations of the Afghan people matter at least as much as the dour and pessimistic reports and news stories. Yes, things might go badly in Afghanistan, but we are not there to see the Afghans fail. The Afghans know first-hand the horrible consequences of failure. They have, as we say, skin in the game, and are committed to succeeding.

It’s an important tradition for me to begin public appearances by thanking those who’ve served our country, specifically in Afghanistan but more broadly as well.  Whether in the military, as a government civilian, or as an implementing partner, I know the risks and the sacrifices you and your families have taken and sincerely thank you for your service. The recent attack on the Taverna du Liban in Kabul was a grim reminder of the risks our colleagues in the field take on a daily basis to help the people of Afghanistan to build a future that is better than their past.

2014 is being billed as be a pivotal year for Afghanistan, but as someone who first started working there in 2002, I can honestly say that every year in Afghanistan has been pivotal in some fashion. Each of the coming years will also probably be important for the foreseeable future.

I am clear-eyed about what we face. There are real and legitimate concerns about what will happen in Afghanistan following the security and political transitions this year. But, as I noted earlier, we’re not shrinking from the challenges and opportunities that transition will offer. How we see the future depends in large part on how we see the recent past. Let me give you my perspective on how far Afghanistan has come, and how much has been accomplished, as a starting-point for what has yet to be done.

Looking Back

In my mind one of the most telling metrics of the progress we’ve collectively made to date in Afghanistan is the network of paved roads. We’re going to talk today about economic viability. In an agriculture based society like that of Afghanistan, a decent road network is essential for the commerce that makes farming at anything above subsistence levels sustainable. In 2002 Afghanistan had about 50km of paved roads. That’s not to say they were good paved roads, but passable paved roads. Let me put that in perspective: If a map of Afghanistan were laid atop a map of the United States it would roughly cover all of New England from the Atlantic to the Great Lakes and from Maine as far south as North Carolina. And it would only have one paved road, from roughly Washington to Baltimore. Today, the best estimate I could find of the amount of paved roads in Afghanistan was approximately 10,000 miles.

When the Taliban were overthrown, there was no functioning government. There really was not much of anything that functioned. At the time of the Taliban more mothers, infants, and children under the age of 5 died in Afghanistan, proportionally, than in virtually any other country in the world, and often for preventable reasons. The number of infants and children dying has been reduced by more than half. Additionally, maternal mortality is now less than about 20 percent of what it was before. Less than 9% of Afghans had access to health care within an hour walk of their homes. Today that number is over 60%, and USAID has helped train over 22,000 health workers to ensure that upon arrival to these facilities Afghans can receive the treatment they need. A cumulative result of our investment of time, energy, and money in health care is that life expectancy in Afghanistan has jumped by more than 20 years. This is a remarkable accomplishment in such a short period of time.

With respect to education under the Taliban, if children were lucky enough to survive to school age, there were barely any schools to go to and there were none for girls. In 2002, only an estimated 900,000 boys were in school. Now, there are approximately 8 million students enrolled in school, more than a third of whom are girls. University enrollment has increased from 8,000 in 2001 to 77,000 in 2011. We will continue to support higher education in ways I’ll mention in a few moments.

Finally, I would be remiss if I didn’t call-out the bold advances made by Afghan women in the past decade. In 2002 the advocates for women I met in Afghanistan were mostly expatriate women who had bravely returned to their country, or men. Today, each time I go back to Afghanistan, I’m struck by the talent and the passion of young professional women who are moving into almost every facet of life and government. Their gains have been hard-fought, and are still dangerously fragile. But if you visit the USAID website, and go to the Afghanistan Education page, you’ll see a photograph of a girl’s classroom, with a message on the chalk board that says in English “The great thing about education is that no one can ever take it from you.” That sentiment, and the tenacity and courage of Afghan women give me cause for optimism that their gains will not be surrendered, and their progress will not be stopped.

This is just a snap-shot of some of the tremendous progress made to-date. We have also helped increase Afghans’ access to safe drinking water, and helped build their electrical grid to where over 20% of the population has access to reliable electricity, as opposed to less than 6% under the Taliban. In fact DABS, the local Afghan utility company, is continuing to build not just the capacity to generate and distribute electricity, but also a business model that will allow them to collect the revenues required to make their power system self-sustaining.

A recent poll shows that more than 70% of Afghans said they were feeling more economically secure compared to five years ago.  In a recent survey by The Asia Foundation, the majority of the Afghan population surveyed felt that their nation was headed in the right direction. I speak with confidence when I say that the vast majority of the Afghan people do not wish to see a return to the bad old days.

Speaking directly to my Dad and the folks back home in North Georgia, and to voters and taxpayers all across the country, it just isn’t as bad as the press reports would have you believe. Is it dangerous? Yes, but that hasn’t stopped us thus far.  Could we have done better? Yes, absolutely. However, as I’ve shown, the sacrifice and investments have produced amazing results. Is there much still to be done? Yes, without question. I’m now going to talk about the way ahead, through what the United States calls “Transition,” and into what the Afghans call with some excitement their “Decade of Transformation.”

If looking back shows us a trajectory of hard-won progress in areas of health, education, the rights of women and girls, and infrastructure, what does the Decade of Transformation offer? What does it require of us? Among other things, I think it requires honest and candid discussions about tough choices to be made regarding the allocation of resources, and about expectations on the part of their government and people, as well as our own. To be successful it will continue to require money; Less than before but still large amounts of money. We have to be able to manage and protect that money as it is spent which is no small challenge. It will require “strategic patience” balanced by firm commitments and resolve with respect to metrics of success and relentless progress.

But most of all, I think it requires a commitment to persistent engagement on the civilian side as our international militaries draw-down. Absent this commitment, I think we will see Afghans beginning to hedge their bets.  Self-interest will require them to act in ways they think are most likely to protect them and their interests. It might be the flight of capital or entire families from the country. It might be a realignment of loyalties driven by perceived changes in local power structures. But, suffice it to say, hedging strategies will not ever contribute to what we would describe as a successful decade of transformation.

With an eye towards communicating our continuing engagement in Afghanistan what does that mean for us right now? We will continue to work with colleagues on the Hill to help shape budgets for out-years related to Afghanistan. Certainly commitments made at Chicago and Tokyo need to be honored, but beyond that, we need to give our Afghan colleagues some sense of what they can expect as budgets are reduced, and some sense of predictability.

In Afghanistan we are looking forward to a successful and credible election this spring. Our net contributions to the electoral efforts are just under $100 million dollars. We want to be clear that the US doesn’t support a particular candidate or slate, but that we support the democratic process that Afghanistan is taking, and that we look forward to working with a newly-elected administration later this year.

We are committed to cementing the gains made in traditional development sectors, such as health, education, and gender. We will continue to work with the government in Afghanistan to help build the systems required to be an effective state. It isn’t for example, just the ability to fix potholes that makes for a successful operations and maintenance effort. It requires a bureaucratic and administrative system to ensure the materials are available, the staff are trained and paid for their work, and that potholes aren’t just repaired in certain areas, but throughout the country. The same is true for health care, and for education.

We will also continue to provide on-budget assistance to specific Afghan ministries. Despite inflammatory reports to the contrary, our on-budget assistance does not put US taxpayer dollars at increased risk. It does not result in money going to particular individuals or political blocks in Afghanistan, and it does not increase the likelihood of fraud, waste, or abuse. On the contrary, both in the immediate sense and over time, our careful and deliberate execution of on-budget support reduces the likelihood of misappropriation. In the most immediate sense, USAID has in place for every direct assistance program a process of overseeing and safeguarding the money being disbursed. This ensures that it only goes for work that has been certified as accomplished, that it only goes to the organization that actually accomplished the work, and ensures we retain control of the money.

Different ministries have different strengths and weaknesses, and different programs are funded in different ways. However, for all of them we have these assurances in place. We begin with our own assessments of the risks inherent in a particular program with a particular ministry, and build our mitigating measures and safeguards accordingly. At the same time, with an eye towards building Afghan systems that are able to prevent corruption and fraud, waste, or abuse on their own, we are simultaneously building the capacities of these ministries, so that they understand the importance of the various often complicated systems of checks-and-balances.

I can’t tell you how disappointed I am, and how demoralizing it is for our staff in the field, to have so many reports and stories come out that articulate quite well our own assessment of the frailties of particular ministries, but then completely ignore the significant work that goes into mitigating those frailties in the short-run and working with the Afghans to eliminate them over time.

One element of transition and the transformational decade that deserves our attention is that of economic sustainability.  It is a meta-level requirement for success. Afghanistan simply must be able to generate coherent economic activities that will support their population and fund their government. We know this will not happen overnight, but as we pivot from the war years towards transformation, this is something that will shape our programming and our efforts.

I’d like to talk about three programs that have been recently awarded as examples of how the transformational decade and a focus on economic sustainability are shaping our efforts. The first is an Afghan Trade and Revenue Program. This program is designed to support Afghanistan’s accession to the World Trade Organization (WTO), increase Afghanistan’s international trade, and provide the government with support to improve its ability to generate revenue to replace donor assistance. Accession to the WTO is a big deal for a country like Afghanistan. There are peer-reviewed articles which suggest that if countries like Afghanistan make the regulatory reforms required to achieve WTO accession, they will typically see a net jump in GDP of 20% over the next five years. That’s especially significant as we work to off-set the financial consequences of the military draw-down.

Supporting bilateral and multilateral agreements with the Central Asian Republics, Pakistan, and India is also an important part of Afghanistan’s economic future. This includes support for the implementation of harmonized tariffs, simplified border crossing procedures, and private sector linkages. Finally, supporting the introduction of a value-added tax (VAT) and tax collection as well as continued improvement in customs revenue collection are expected to result in increases in the hundreds of millions dollars annually for the government in Afghanistan. As an example, Central Asian neighboring countries have experienced annual revenue gains ranging from 2% to 8% of GDP following introduction of a value-added tax (VAT). So the Afghan Trade & Revenue Program addresses economic activity and the growth of GDP directly and systemically at the national level.

This next program, the Regional Agricultural Development Program, is designed to improve food and economic security for rural Afghans, through strengthening key agricultural value chains, and improving the policy and regulatory environment for agribusiness.  It will focus on wheat, livestock, and two or three high-value crops in each of the regions where it will operate. This program recognizes that for a nation like Afghanistan to move beyond mere subsistence agriculture and make licit crops both sustainable and profitable for farmers, they must focus not just on the work of the farmers themselves, but on the value-chains that serve the business environment in which they operate.

It’s been described as a “field to fork” focus on agricultural effectiveness.

Among other things, this program is expected to

• Benefit 400,000 farmers by providing access to better technology and marketing
• Produce a 20% increase in yields for wheat and target crops
• Generate a $43M increase in total sales across targeted value chains
• Create 10,000 new jobs
• Generate new laws, regulations, and/or policies that will improve the operating environment for agribusiness in Afghanistan.

Focusing on the particular agricultural nature of Afghanistan’s economic future, this program has local and regional impacts, but is also designed to boost the volume and energy of the nation’s economic activity through more and better-quality crops and a stronger agribusiness community.

The last program that I want to introduce today fits well into the transformational decade because it both builds on work done since 2002, and focuses on the needs of the business community and government going forward. The Afghan University Support & Workforce Development Program will work through 2018, and will take as its input the thousands of young Afghans who have now completed their primary and secondary educations. It will seek to produce 2-year graduates with Associate Degrees in fields that are expected to be key to the sustained growth of Afghanistan. This might include public utilities (power and water), agribusiness and agricultural extension, and the business management skills required to facilitate small to medium enterprises as part of burgeoning value-chains. Specifically, the program partners with US Universities (University of Massachusetts, Amherst, and Purdue University) to create ten different University Career and Partnership Centers at ten different Afghan universities. These centers will represent a coordinated effort between the Ministry of Higher Education, local and national businesses, and the American and Afghan universities to ensure that the students receiving Associates’ Degrees are trained and ready to fill the needs of Afghanistan’s workforce.

There are other programs currently in procurement which I can’t speak about with any specificity, but which also fit into the tapestry of programs we are designing with the people and government of Afghanistan to ensure that our support through this transition and transformational decade is sensible, sustainable, and developmentally sound.

Let me conclude my remarks by addressing the issue of oversight: Or, as I’m often asked, “How on Earth will you expect to adequately monitor these programs when the international troops leave?”

The quick response would be that it will be challenging. But we will build on our experience from monitoring other programs in the dozens of challenging places around the world where there are no international troops present. This isn’t a fundamentally new problem for us. It’s different in terms of size and scale, but conceptually, monitoring programs in Yemen or Columbia or Niger is not really all that different than in Afghanistan. But yes, it’s a challenge, and we must be vigilant, adaptive and prepared.

We know from experience that no single system of monitoring and oversight is fool-proof. But we work with the unique context of each program to design a monitoring plan that is appropriate, multi-dimensional, in that it relies on inputs from a variety of sources, and that we feel will adequately allow our US government employees to make informed decisions about the program as it unfolds.  If we can’t articulate a suitable monitoring plan, then we won’t execute the program. It’s that simple. As the program unfolds, the monitoring plan can then be tweaked and tailored to ensure that we have good, credible information from a variety of sources.

I’ll just finish by saying that the United States government went to Afghanistan because securing the ungoverned spaces there served our national interest and still does.

USAID represents a chance to build partner capacities in such a way that Afghanistan will be able to join the global economy, wean itself from donor dependency, govern its population justly, and secure its own ungoverned spaces. Development, almost any way you measure it, is a good and cost-effective alternative to eventually having to deploy soldiers.

Now, as the military begins to draw-down, it is more important than ever that our Afghan colleagues, the people of Afghanistan, feel secure in the knowledge that our civilian engagement will endure, and that we will support them as they enter this decade of transformation.

I thank you for your time and attention today, and look forward to our discussion.