Torn by war for more than two decades and with its economy in tatters, Afghanistan is one of the world’s poorest countries and relies almost entirely on outside aid.
The primary source of hard currency in Afghanistan is the opium poppy. The United Nations estimates that cultivation and export of raw opium brings in about $2.6 billion annually.
Sadly, most of these illicit earnings go into the pockets of Afghanistan’s dozen or so warlords; the common people see little of it.
The World Bank has set out its strategy for Afghanistan’s reconstruction. It places a high priority on rebuilding an entire social and education infrastructure. It also hopes to re-establish a functioning banking system. Redeveloping this failed Central Asian nation says experts, will cost a considerable amount of money.
Strategic Policy has obtained a report that attempts to estimate how much money will be required to rebuild Afghanistan’s shattered economy. The report, which will be presented this week in Tokyo at a UN-sponsored conference focusing on Afghanistan’s redevelopment, estimates that it will cost at least $15 billion to rebuild the war-ravaged, land-mine-laden country.
The assessment, prepared by a panel of international financial experts, will serve as the agenda for the two-day Tokyo meeting.
Representatives of 50 nations are scheduled to attend most of them foreign, development or financial ministers. Host country Japan has already indicated it will contribute $500 million for Afghanistan’s reconstruction over the next 2 1/2 years, the duration of the transitional administration in Afghanistan. Treasury Secretary Paul H. O’Neill and Secretary of State Colin L. Powell will represent the United States at the meeting.
The UN conference is meant in part to reinforce support domestically and abroad for Hamid Karzai, the head of Afghanistan’s interim administration, who also will be in Tokyo.
Karzai’s new government is taking over a country with no infrastructure or police, little manufacturing or agriculture, few schools and hospitals and a vast displaced population. By some estimates, it will take more than a half-billion dollars to find and destroy millions of land mines, which have rendered useless much of Afghanistan’s farmlands and orchards.
"In the immediate months ahead, the Afghan administration will be under pressure to achieve quick results in its reconstruction efforts, meeting pressing needs in a way that gives the citizens a stake in peace and stability, and enhancing national integration," the report says. "This underlines the urgent need for up-front reconstruction activities and support from the international assistance community," the report said.
The first year of Afghanistan’s reconstruction alone is estimated to cost about $1.73 billion.
Mark Malloch Brown, administrator for the United Nations Development Program, acknowledges that estimates for Afghanistan’s reconstruction "have drifted upward" from the $5 billion to $10 billion anticipated at donors meeting in Brussels last December.
Malloch Brown says that after consulting with the interim administration, planners had not allocated enough for security or such running costs as municipal salaries and maintenance. He also notes that the government has no prospects for raising tax revenue for the next few years, "and there is nothing in the treasury. Their bank vaults are an echo chamber; there is not an Afghani in there."
Last Saturday, Afghanistan’s planning minister, Haji Mohammed Mohaqiq, told Reuters news agency that the country needed at least $45 billion over the next decade to rebuild.
