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Afghanistan: World Bank Official Says Tokyo Aid Will Take Slow Road

Most of the $4.5 billion pledged to Afghanistan on 21-22 January by donor nations in Tokyo will not reach the war-torn country anytime soon. A World Bank official speaking in the capital, Kabul, said until the proper structures for financial governance are in place, the inflow of money will be limited to a trickle -- and for some projects, may even take years.

Kabul, 31 January 2002 (RFE/RL) -- At a press conference yesterday evening in Kabul, World Bank official William Byrd said it will still be months or even years before the full impact of the $4.5 billion in aid pledged at the Tokyo donors conference is felt.

Byrd, the bank's acting country manager for Afghanistan, said a 10-member World Bank team is currently in Kabul to help the administration put in place the necessary financial systems to manage the incoming aid. By helping establish a transparent and accountable system of financial governance, he said, the country's future administration -- to be put in place following a loya jirga, or grand council, in June -- will be better able to effectively manage aid flows.

A team from the International Monetary Fund is also in Kabul and working closely with the World Bank experts on economic and financial issues.

The World Bank, which is due to open a permanent office in the Afghan capital soon, has already targeted key sectors for development. These include: health, education, energy, water supply, roads, community development, communications, and agriculture. The bank will work together with the United Nations Development Program to create emergency programs for these areas.

Byrd said the bank is offering grants totaling some $50 million for urgent reconstruction projects during the next few months. The World Bank official offered few details about the nature of these projects, but he said the bank tried to focus on areas that could have the quickest positive impact on people's lives.

Pressed for information, Byrd eventually offered an example of a likely area of support: "Just to take one example: We've visited a water supply scheme, where the potential will be for a very small investment to bring safe piped water to a large proportion of the population of Kabul. That's just one example."

Byrd conceded that the slow start is due in part to the fact that the interim administration is still having a difficult time identifying and prioritizing potential projects for the bank.

"The government capacity and the finances are very limited. It came in with much of the institutional structures weakened," Byrd said. "There are exceptions, there are remarkable people still at their posts and doing their jobs, but really a lot remains to be done."

For larger sums of aid from Tokyo to begin flowing into the country, certain government structures need to be created -- sometimes literally from the ground up -- and staffed with trained personnel. The country has no accountability or procurement mechanisms and no tradition of financial management. In other words, there is nothing in place in Afghanistan to offer donors assurance their pledges will be used appropriately.

Byrd said the development of a working financial system is the World Bank's top priority in Afghanistan: "You need a payments mechanism for aid funds to flow in and to be utilized effectively -- you need a payments mechanism, which means a way that funds can flow in and can be actually used. Then you need a method to procure services. This money is not just being spread out, it's being used to procure, for example, equipment for a water supplies scheme, or schoolbooks for children, or repairs to buildings, or repairs to streets, and so on."

Byrd said it will be at least "a couple of months" before a system of financial accountability is in place in Afghanistan. Until then, he said, the funds pledged in Tokyo will wait in limbo, or will be spent in part on external consultancy. The World Bank official said that for some major projects -- like road repair -- it may even be a matter of years before the aid money is received.