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Report to Congressional Requesters:

June 2003:

Foreign Assistance:

Lack of Strategic Focus and Obstacles to Agricultural Recovery Threaten 
Afghanistan's Stability:

GAO-03-607:

GAO Highlights:

Highlights of GAO-03-607, a report to congressional requesters 

Why GAO Did This Study:

After the events of September 11, 2001 led to the defeat of the 
Taliban, the United States and the international community developed 
an assistance program to support Afghanistans new government and its 
people. Key components of this effort include food and agricultural 
assistance. GAO was asked to assess (1) the impact, management, and 
support of food assistance to Afghanistan and (2) the impact and 
management of agricultural assistance to Afghanistan, as well as 
obstacles to achieving food security and political stability.

What GAO Found:

The emergency food assistance that the United States and the 
international community provided from January 1999 through December 
2002 helped avert famine by supplying millions of beneficiaries with 
about 1.6 million tons of food. However, the inadequacy of the 
international communitys financial and in-kind support of the World 
Food Programs (WFP) appeal for assistance disrupted the provision of 
food assistance throughout 2002. Because of a lack of resources, WFP 
reduced the amount of food rations provided to returning refugees from 
150 kilograms to 50 kilograms. Meanwhile, as a result of the statutory 
requirement that U.S. agencies providing food assistance purchase U.S.-
origin commodities and ship them on U.S.-flag vessels, assistance 
costs and delivery times were higher by $35 million and 120 days, 
respectively, than if the United States had provided WFP with cash or 
regionally produced commodities. Had the U.S. assistance been 
purchased regionally, an additional 685,000 people could have been fed 
for 1 year.

The livelihood of 85 percent of Afghanistans approximately 26 million 
people depends on agriculture. Over 50 percent of the gross domestic 
product and 80 percent of export earnings have historically come from 
agriculture. Over the 4-year period, because of continued conflict and 
drought, the international community provided primarily short-term 
agricultural assistance such as tools and seed. As a result, the 
assistance did not significantly contribute to the reconstruction of 
the agricultural sector. In 2002, agricultural assistance was not 
adequately coordinated with the Afghan government; a new coordination 
mechanism was established in December 2002, but it is too early to 
determine its effectiveness. As a result of the weak coordination, the 
Afghan government and the international community have not developed a 
joint strategy to direct the overall agricultural rehabilitation 
effort. Meanwhile, inadequate assistance funding, continuing terrorist 
attacks, warlords control of much of the country, and the growth of 
opium production threaten the recovery of the agricultural sector and 
the U.S. goals of food security and political stability in 
Afghanistan.

What GAO Recommends:

GAO recommends that the Secretary of State and the Administrator of 
USAID take an active role in an internationalAfghan effort to develop 
an agricultural rehabilitation strategy. 

GAO suggests that Congress consider amending the Agriculture Trade 
Development and Assistance Act of 1954, as amended, and the Merchant 
Marine Act of 1936, as amended, to allow the purchase of commodities 
overseas and waive the U.S.-flag vessel requirement under certain 
circumstances.

The agencies agree with the need to develop a strategy, but USAID does 
not think it should lead the effort. In terms of providing 
flexibility, WFP agrees, but U.S. agencies disagree with the need to 
amend legislation.

www.gao.gov/cgi-bin/getrpt?GAO-03-607.

To view the full product, including the scope and methodology, click 
on the link above. For more information, contact Loren Yager (202) 512-
4347 or yagerl@gao.gov.

[End of section]

Contents:

Letter:

Results in Brief:

Background:

U.S. and International Food Assistance Had Significant Impact and Was 
Well Managed, but Donor Support Was Problematic:

Agricultural Assistance Has Had Limited Impact and Lacks Coordination, 
and Major Obstacles Jeopardize Food Security and Political Stability:

Conclusions:

Matter for Congressional Consideration:

Recommendations for Executive Action:

Agency Comments and Our Evaluation:

Appendixes:

Appendix I: Scope and Methodology: 

Appendix II: World Food Program Projects in Afghanistan, 2002:

Appendix III: Description of WFP Food Assistance Monitoring
Mechanisms:

Appendix IV: Donor Contributions to World Food Program Emergency
Operation 10155 as of May 12, 2003:

Appendix V: Cost Data for U.S. Food Assistance to Afghanistan Provided
to the UN World Food Program, Fiscal Years 19992002:

Appendix VI: International Donor Assistance Coordination Mechanisms in
Afghanistan:

Appendix VII: Major Donors Pledges and Contributions as of December 
31, 2002 (as reported by the U.S. Department of State):

Appendix VIII: Comments from the World Food Program:

GAO Comments:

Appendix IX: Comments from the Department of State:

GAO Comments:

Appendix X: Comments from the United States Agency for International
Development:

GAO Comments:

Appendix XI: Comments from the Department of Agriculture:

GAO Comments:

Appendix XII: Comments from the Department of Defense:

GAO Comments:

Appendix XIII: GAO Contacts and Staff Acknowledgments:

GAO Contacts:

Staff Acknowledgments:

Tables:

Table 1: WFP Operations: Cash Donations, Food Donations, Number of 
Beneficiaries, and Percentage of U.S. Contribution, 19992002:

Table 2: Projected Cumulative Funding Requirements for the
Reconstruction of Afghanistan:

Table 3: Major Assistance Coordination Mechanisms in
Afghanistan in 2002:

Table 4: Comparison of Implementation Group and Consultative
Group Processes:

Figures: 

Figure 1: Map of Afghanistan, Including Provinces and Major Roads:

Figure 2: Drought-Affected Areas in Afghanistan as of October 2001:

Figure 3: WFP Distribution of U.S. -Provided Food in Afghanistan:

Figure 4: Road Conditions Faced by WFP Truckers in Afghanistan:

Figure 5: Use of Donkeys to Deliver Food to Remote Areas:

Figure 6: Resource Requirements vs. Actual Deliveries for WFP
Emergency Food Assistance Operation in Afghanistan, April 2002
January 2003:

Figure 7: Costs for U.S. Food Assistance to Afghanistan, Fiscal
Years 19992002:

Figure 8: Humanitarian Daily Rations:

Figure 9: FAO Irrigation Rehabilitation Project:

Figure 10: Hierarchy of Strategies for Agricultural Sector
Reconstruction:

Figure 11: Organizations Responsible for Coordinating International
Assistance in Afghanistan, 19982003:

Abbreviations:

ACTED: Agency for Technical Cooperation and Development:

FAO: Food and Agriculture Organization:

HDR: humanitarian daily ration:

ITSH : Internal Transport, Storage, and Handling:

NDF: National Development Framework:

UN: United Nations:

UNAMA: UN Assistance Mission in Afghanistan:

UNDP: United Nations Development Program:

USAID: United States Agency for International Development:

USDA: United States Department of Agriculture:

WFP: World Food Program:

Letter June 30, 2003:

The Honorable Richard J. Durbin 
Ranking Minority Member 
Subcommittee on Oversight of Government Management, the Federal 
Workforce, and the District of Columbia 
Committee on Governmental Affairs 
United States Senate:

The Honorable Frank R. Wolf 
Chairman 
Subcommittee Commerce, Justice, State, and the Judiciary 
Committee on Appropriations 
House of Representatives:

Afghanistan is a country devastated by 23 years of war and destructive 
domestic policies and more than 4 years of drought. The livelihood of 
85 percent of Afghanistan's approximately 26 million inhabitants 
depends on agriculture, yet the food and agricultural sector has been 
severely damaged.[Footnote 1] Since 1978, the country has required 
international food aid to help meet the shortfall between food supply 
and demand. Since 1999, the United States has been the largest donor of 
food and agricultural assistance to Afghanistan. The U.S. policy goal 
in Afghanistan is to create a stable Afghan society that is not a 
threat to itself or others and is not a base for terrorism; U.S. food 
and agricultural assistance to Afghanistan is intended not only to 
provide emergency relief but also to help achieve this long-term goal. 
The United States has provided short-term, emergency food assistance to 
feed Afghanistan's vulnerable populations, as well as longer-term 
agricultural development assistance to help Afghanistan improve its 
food security[Footnote 2] and political stability. The majority of U.S. 
assistance has been given through the U.S. Agency for International 
Development (USAID) and the U.S. Department of Agriculture (USDA) to 
the United Nations (UN) World Food Program (WFP) and the UN Food and 
Agriculture Organization (FAO), as well as nongovernmental 
organizations. Nongovernmental organizations and contractors 
distribute most of the assistance provided through the UN organizations 
in Afghanistan.

Because of concerns about the United States' and UN's ability to 
deliver assistance in such a complex environment, and recognizing the 
interrelationship of short-term emergency food assistance and longer-
term agricultural assistance, you asked that we examine the food and 
agricultural assistance provided to date. We assessed, for 1999-2002, 
(1) the impact, management, and U.S. and international support of 
short-term, emergency food assistance to Afghanistan and (2) the impact 
and management of long-term, agricultural development assistance to 
Afghanistan, as well as obstacles to achieving food security and 
political stability.

To address these issues, we collected and analyzed information from the 
U.S. Departments of Agriculture, Defense, and State; the U.S. Agency 
for International Development; the UN World Food Program, Food and 
Agriculture Organization, and Development Program; the World Bank; the 
Asian Development Bank; and the Afghan Ministry of Agriculture and 
Animal Husbandry and Ministry of Irrigation and Water Resources. This 
effort included an analysis of the cost data for U.S. food assistance 
provided through these agencies and organizations. In addition, we 
contacted 14 nongovernmental organizations, responsible for delivering 
WFP and FAO assistance in Afghanistan, to obtain their views on a range 
of issues including the management of donated commodities and 
coordination. Finally, we traveled to Afghanistan to examine the WFP's 
operations in country. Our presence in Afghanistan was limited due to 
security precautions imposed by the Department of State. While in 
Afghanistan, we spoke with officials from U.S., UN, and nongovernmental 
organizations and the Afghan government. (For further details of the 
scope and methodology of our study, see app. I.):

Results in Brief:

The emergency food assistance provided by the United States and the 
international community from January 1999 through December 2002 helped 
avert famine by providing approximately 1.6 million tons of 
food.[Footnote 3] The WFP managed the assistance efforts effectively, 
overcoming significant obstacles and employing monitoring mechanisms 
such as a real-time automated tracking system and periodic site visits. 
We observed organized and efficient food distribution operations at WFP 
sites, and available program data showed that less than 1 percent of 
the assistance was lost. However, the inadequacy of the international 
community's financial and in-kind support of the WFP's appeal for 
assistance disrupted the provision of food assistance throughout 2002. 
For example, because of lack of resources, the WFP reduced the amount 
of food rations provided to returning refugees from 150 kilograms to 50 
kilograms. Meanwhile, as a result of the statutory requirement that 
U.S. agencies providing food assistance purchase U.S.-origin 
commodities and ship 75 percent of them on U.S.-flagged vessels, 
assistance costs and delivery times were higher by $35 million and 120 
days, respectively, than if the United States had provided cash or 
regionally produced commodities to international assistance agencies.

The agricultural assistance provided by the international community had 
a limited impact, from 1999 to 2002, because of continued conflict and 
drought. During this period, FAO, nongovernmental organizations, and 
others provided primarily short-term agricultural assistance such as 
distributing tools and seed and, as a result, the assistance did not 
significantly contribute to the reconstruction of Afghanistan's 
agricultural sector. In addition, in 2002, international agricultural 
assistance was not adequately coordinated with the Afghan government, 
contrary to established guidelines. A new coordination mechanism was 
established in December 2002, but it is too early to determine its 
effectiveness. Because of the lack of coordination, the Afghan 
government and the international community have not developed a joint 
strategy to integrate the numerous disparate assistance projects and 
manage the overall agricultural rehabilitation effort. Finally, 
obstacles to future rehabilitation efforts include inadequate funding 
to meet the U.S. and international community's goal of rehabilitating 
the agricultural sector. The international community plans to spend 
approximately $230 million on agricultural assistance in 2003. However, 
FAO officials said that the agricultural rehabilitation effort will 
cost billions of dollars and take at least a decade to complete. 
Meanwhile, the unstable security situation, the control by warlords of 
much of the country, and the growth of opium production create 
additional obstacles to achieving food security and political stability 
in Afghanistan.

To increase the United States' flexibility in responding to complex 
emergencies where U.S. national security interests are involved, such 
as that in Afghanistan, Congress may wish to consider amending existing 
food aid legislation to allow, in the event of such emergencies, the 
provision of non-U.S.-produced commodities and the provision of cash to 
international assistance agencies to purchase non-U.S.-produced 
commodities and amending cargo shipping legislation to allow waiver of 
the requirement to ship food assistance on U.S. flag vessels. In 
addition, we are recommending that the Department of State (State) and 
USAID take an active role in a joint international-Afghan government 
effort to develop an operational agricultural sector rehabilitation 
strategy that contains measurable goals, defines resource levels, 
delineates responsibilities, identifies external factors that affect 
the achievement of goals, and requires program evaluations.

We presented a draft of this report to WFP, State, USDA, USAID, and the 
Department of Defense. WFP agreed with our recommendation that the 
Agricultural Trade Development and Assistance Act of 1954 be amended, 
but State, USDA, and USAID did not. State thought that more cost-
benefit studies were needed, and USAID and USDA stated that other 
existing legislation allows USAID and State the resources and 
flexibility necessary to respond to humanitarian crises. USDA also 
observed that changes in cargo preference regulations would help reduce 
overall U.S. assistance costs while not negatively affecting the 
provision of U.S. commodities. In addition, USDA asserted that if the 
United States had provided greater levels of commodities as a result of 
purchasing regionally produced commodities, WFP's logistical system 
would have been overstrained and savings in cost and time would have 
been marginal. We maintain that amending the Agricultural Trade 
Development and Assistance Act of 1954 would provide greater 
flexibility than the provisions contained in other existing 
legislation. The act is the principal authority for providing food 
assistance in emergency and nonemergency situations. In both 2002 and 
2003 over $2 billion in food assistance, the preponderant amount of 
this type of assistance, was dispersed under this authority. Amending 
the act will provide a permanent provision in the principal authority 
for providing U.S. food assistance, allowing the United States to 
respond rapidly and in a cost effective manner to events that affect 
U.S. national security. Further, in the event that U.S. commodities are 
not available, amending the act will provide the United States with the 
flexibility to respond in a timely and cost effective manner. However, 
we agree with USDA that the cargo preference requirement adds 
additional cost to food assistance and should be waived in specific 
situations, and we have adjusted the matter for congressional 
consideration to reflect this point. We disagree with USDA's claim that 
additional commodities would have overburdened WFP and that the savings 
from purchasing regional commodities would have been insignificant. WFP 
moved record-levels of commodities through its extensive logistics 
system in Afghanistan. Further, purchasing commodities regionally could 
have reduced delivery time by 120 days and increased the amount of 
commodities purchased by 103,000 metric tons.

WFP, State, USDA, and USAID all agreed with our recommendation that a 
joint Afghan-international donor strategy for the rehabilitation of 
Afghanistan's agriculture sector is needed. However, USAID stated that 
FAO, not USAID, should lead such an effort. We maintain that USAID 
should lead the effort because the United States is the largest donor 
to Afghanistan, agricultural rehabilitation is the cornerstone of 
USAID's efforts in Afghanistan, and the success of U.S. policy goals in 
Afghanistan is tightly linked to the rehabilitation of the agricultural 
sector.

The Department of Defense limited its comments to issues pertaining to 
its humanitarian daily ration program. The Department of Defense stated 
that (1) we incorrectly characterized the ration program as strictly a 
food aid program, (2) its informal evaluations of the program indicated 
that it alleviated hunger and generated goodwill among the Afghan 
people, and (3) although the funds used to purchase rations could have 
been used to purchase bulk food, the bulk food could not have been 
delivered to remote areas. The report discusses the food assistance and 
nonfood assistance aspects of the rations program, and we have added 
information about the goodwill generated by the rations to the report. 
As described in the report, WFP's well established logistics system was 
capable of delivering food to all parts of Afghanistan throughout 2001, 
including the months of October through December when the rations were 
being delivered.

Background:

Afghanistan is a mountainous, arid, land-locked Central Asian country 
with limited natural resources. At 647,500 square kilometers, it is 
slightly smaller than the state of Texas. Afghanistan is bordered by 
Pakistan to the east and south; Tajikistan, Turkmenistan, Uzbekistan, 
and China to the north; and Iran to the west (see fig. 1). Its 
population, currently estimated at 26 
million, is ethnically diverse, largely rural, and mostly uneducated. 
Life expectancy in Afghanistan is among the lowest in the world, with 
some of the highest rates of infant and child mortality.[Footnote 4]

Figure 1: Map of Afghanistan, Including Provinces and Major Roads:

[See PDF for image]

[End of figure]

Political conflicts have ravaged Afghanistan for years, limiting 
development within the country. Conflict broke out in 1978 when a 
communist-backed coup led to a change in government. One year later, 
the Soviet Union began its occupation of Afghanistan, initiating more 
than two decades of conflict. Over the course of the 10-year 
occupation, various countries, including the United States, backed 
Afghan resistance efforts. The protracted conflict led to the flight of 
a large number of refugees into Pakistan and Iran. In 1989, the Soviet 
forces withdrew, and in 1992, the communist regime fell to the Afghan 
resistance. Unrest continued, however, fueled by factions and warlords 
fighting for control.

The Taliban movement emerged in the mid 1990s, and by 1998 it 
controlled approximately 90 percent of the country. Although it 
provided some political stability, the Taliban regime did not make 
significant improvements to the country's food security. Furthermore, 
the Taliban's continuing war with the Northern Alliance and the 
Taliban's destructive policies, highlighted in its treatment of women, 
further impeded aid and development. Coalition forces removed the 
regime in late 2001, responding to its protection of al Qaeda 
terrorists who attacked the United States. In December 2001, an 
international summit in Bonn, Germany, established a framework for the 
new Afghan government, known as the Bonn Agreement.[Footnote 5]

Agriculture is essential to Afghanistan. Despite the fact that only 
11.5 percent (7.5 million hectares) of Afghanistan's total area is 
cultivable,[Footnote 6] 85 percent of the population depends on 
agriculture for its livelihood, and 80 percent of export earnings and 
more than 50 percent of the gross domestic product have historically 
come from agriculture.[Footnote 7] However, Afghanistan's agricultural 
sector continues to suffer from the effects of prolonged drought, war, 
and neglect. It lacks high-quality seed, draft animals, and fertilizer, 
as well as adequate veterinary services, modern technology, advanced 
farming methods, and a credit system for farmers. Further, 
Afghanistan's Ministry of Agriculture and Animal Husbandry and its 
Ministry of Irrigation and Water Resources lack the infrastructure and 
resources to assist farmers.[Footnote 8]

Because Afghanistan experiences limited rainfall, its agricultural 
sector is highly dependent on irrigation--85 percent of its 
agricultural products derives from irrigated areas. Thus, the 
conservation and efficient use of water is the foundation of the 
agricultural sector. The severe drought that has gripped the country 
since 1998 has resulted in drastic decreases in domestic production of 
livestock and agricultural supplies including seed, fertilizer, and 
feed (see fig. 2). Several earthquakes and the worst locust infestation 
in 30 years exacerbated this crisis in 2002. Without adequate supplies 
and repairs to irrigation systems, even if the drought breaks, farmers 
will be unable to produce the food that the country needs to feed 
itself.

Figure 2: Drought-Affected Areas in Afghanistan as of October 2001:

[See PDF for image]

[End of figure]

Since 1965, the WFP[Footnote 9] has been the major provider of food 
assistance to Afghanistan. Partnering with nongovernmental 
organizations,[Footnote 10] it delivers assistance through emergency 
operations that provide short-term relief to populations affected by a 
specific crisis such as war or drought. It also conducts protracted 
relief and recovery operations designed to shift assistance toward 
longer-term reconstruction efforts. Because of its policy to target 
assistance at specific populations, WFP does not attempt to provide 
food for all of the vulnerable people within a country or affected 
area. Instead, it focuses on specific vulnerable populations such as 
internally displaced people or widows (see fig. 3). Further, it does 
not try to meet all of the daily requirements of the targeted 
populations. WFP's 2002 emergency operation in Afghanistan targeted 
internally displaced people, people affected by drought, and children, 
among others. The assistance programs designed to assist these 
populations provide between 46 and 79 percent, or 970 to 1671 
kilocalories, of the recommended minimum daily requirement of 2100 
kilocalories. WFP assumes that beneficiaries will obtain the remainder 
of their food through subsistence farming or the market.

Figure 3: WFP Distribution of U.S. -Provided Food in Afghanistan:

[See PDF for image]

[End of figure]

FAO has provided much of the agricultural assistance[Footnote 11] to 
Afghanistan. FAO has been involved in agricultural development and 
natural resource management in Afghanistan for more than 50 years. FAO 
was founded in 1945 with a mandate to raise levels of nutrition and 
standards of living, to improve agricultural productivity, and to 
better the condition of rural populations. Today, FAO is one of the 
largest specialized agencies in the UN system and the lead agency for 
agriculture, forestry, fisheries, and rural development. An 
intergovernmental organization, FAO has 183 member countries plus one 
member organization, the European Community. FAO has traditionally 
carried out reconstruction efforts in relatively stable environments. 
Although FAO is increasingly implementing its programs in unstable 
postconflict situations such as Afghanistan, the agency and its staff 
are still adjusting to operating in such environments. FAO's regular 
program budget provides funding for the organization's normative work 
and, to a limited extent, for advice to member states on policy and 
planning in the agricultural sector. FAO's regular budget can also fund 
limited technical assistance projects through its Technical Cooperation 
Program. Apart from this, extrabudgetary resources, through trust funds 
provided by donors or other funding arrangements, fund all emergency 
and development assistance provided by FAO. Thus, extrabudgetary 
resources fund FAO's field program, the major part of its assistance to 
member countries.

U.S. and International Food Assistance Had Significant Impact and Was 
Well Managed, but Donor Support Was Problematic:

The emergency food assistance provided to Afghanistan by the United 
States and the international community from January 1999 through 
December 2002 benefited millions and was well managed, but donor 
support was inadequate. WFP delivered food to millions of people in 
each of the 4 years, helping avert widespread famine. In addition, WFP 
managed the distribution of U.S. and international food assistance 
effectively, overcoming significant obstacles and using its logistics 
system and a variety of monitoring mechanisms to ensure that food 
reached the intended beneficiaries. However, inadequate and untimely 
donor support in 2002 disrupted some WFP assistance efforts and could 
cause further disruptions in 2003. Further, WFP could have provided 
assistance to an additional 685,000 people and reduced its delivery 
times if the United States had donated cash or regionally purchased 
commodities instead of shipping U.S.-produced commodities. 
Additionally, if the United States had donated the $50.9 million that 
it spent on approximately 2.5 million daily rations air-dropped by the 
Department of Defense, WFP could have purchased enough regionally 
produced commodities to provide food assistance for an estimated 1.0 
million people for a year.

Food Assistance Had Important Impact:

The emergency food assistance that the United States and other 
bilateral donors provided in Afghanistan through WFP from 1999 through 
2002 met a portion of the food needs of millions of vulnerable Afghans. 
Over the 4-year period, WFP delivered approximately 1.6 million metric 
tons of food that helped avert famine and stabilize the Afghan people, 
both in Afghanistan and in refugee camps in neighboring 
countries.[Footnote 12] The food assistance also furthered the 
country's reconstruction through projects, among others, that exchanged 
food for work. WFP delivered the assistance as part of seven protracted 
relief-recovery and emergency operations (see table 1).[Footnote 13] 
The types of operations and their duration and objectives varied in 
response to changing conditions within Afghanistan. These objectives 
included, but were not limited to, providing relief to the most 
severely affected populations in Afghanistan and Afghan refugees in 
neighboring countries and preventing mass movements of populations.

Table 1: WFP Operations: Cash Donations, Food Donations, Number of 
Beneficiaries, and Percentage of U.S. Contribution, 1999-2002:

Duration: 1/99-12/99[A]; Total cash donations (millions of dollars): 
$49.5; Percentage of cash contributed by U.S.: 87.3; Food donations: 
(metric tons): 111,502; Percentage of food contributed by U.S.: 89.7; 
Targeted beneficiaries: (millions): 1.2.

Duration: 1/00-12/01[B]; Total cash donations (millions of dollars): 
54.3; Percentage of cash contributed by U.S.: 61.0; Food donations: 
(metric tons): 121,989; Percentage of food contributed by U.S.: 61.5; 
Targeted beneficiaries: (millions): 1.0.

Duration: 8/00-3/01[C]; Total cash donations (millions of dollars): 
47.9; Percentage of cash contributed by U.S.: 78.4; Food donations: 
(metric tons): 114,694; Percentage of food contributed by U.S.: 78.5; 
Targeted beneficiaries: (millions): 1.6.

Duration: 4/01-10/01[D]; Total cash donations (millions of dollars): 
82.2; Percentage of cash contributed by U.S.: 86.7; Food donations: 
(metric tons): 184,462; Percentage of food contributed by U.S.: 82.8; 
Targeted beneficiaries: (millions): 3.8.

Duration: 11/01-10/02[E]; Total cash donations (millions of dollars): 
43.8; Percentage of cash contributed by U.S.: 100.0; Food donations: 
(metric tons): 100,000; Percentage of food contributed by U.S.: 100.0; 
Targeted beneficiaries: (millions): 5.6.

Duration: 10/01-3/02[F]; Total cash donations (millions of dollars): 
225.4; Percentage of cash contributed by U.S.: 61.2; Food donations: 
(metric tons): 500,624; Percentage of food contributed by U.S.: 58.8; 
Targeted beneficiaries: (millions): 7.5.

Duration: 4/02-6/03[G]; Total cash donations (millions of dollars): 
242.3; Percentage of cash contributed by U.S.: 64.5[H]; Food donations: 
(metric tons): 516,394; Percentage of food contributed by U.S.: 
60.0[H]; Targeted beneficiaries: (millions): 9.9.

Duration: Total; Total cash donations (millions of dollars): $745.4; 
Percentage of cash contributed by U.S.: N/A; Food donations: (metric 
tons): 1,649,665; Percentage of food contributed by U.S.: N/A; Targeted 
beneficiaries: (millions): N/A[I].

Duration: Average percentage of contributions from U.S.; Total cash 
donations (millions of dollars): N/A; Percentage of cash contributed by 
U.S.: 68.0; Food donations: (metric tons): N/A; Percentage of food 
contributed by U.S.: 67.0; Targeted beneficiaries: (millions): N/A.

Legend:

N/A = not applicable:

Source: WFP.

[A] Protracted relief and recovery operation 6064.

[B] Protracted relief and recovery operation 6064.01. Operation 
suspended, activities integrated into emergency operation 10046.0.

[C] Emergency operation 6259.0.

[D] Emergency operation 10046.0. Operation terminated and replaced with 
emergency operation 10126.0.

[E] Emergency operation 10098. Operation terminated and replaced with 
emergency operation 10126.0.

[F] Emergency operation 10126.0. Covered beneficiaries in Afghanistan, 
Iran, Pakistan, and Tajikistan.

[G] Emergency operation 10155.0.

[H] As of March 31, 2003.

[I] The cumulative total of beneficiaries cannot be calculated since 
the same beneficiaries may have been served multiple times during the 
4-year period.

[End of table]

WFP implemented a number of different types of food assistance 
projects, including free food distribution; institutional feeding 
programs; bakeries; food-for-work, -seed, -education, -training, and -
asset-creation projects; and projects targeted at refugees, internally 
displaced people, and civil servants. (See app. II for a list and 
description of WFP's projects.) Food-for-work and food-for-asset-
creation projects provided essential food assistance to the most 
vulnerable members of Afghanistan's population while enabling the 
beneficiaries to help rehabilitate local infrastructure and rebuild 
productive assets such as roads and schools. Between July and September 
2002, these projects employed 1 million laborers per month, paying them 
in food commodities.[Footnote 14]

U.S. food assistance to Afghanistan, provided by USAID and USDA, 
accounted for approximately 68 percent of the cash contributions and 67 
percent of the commodities delivered by WFP from 1999 through 2002 (see 
table 1). The U.S. provides cash to WFP to cover transportation and 
administrative costs associated with its in-kind contributions of 
commodities.[Footnote 15] USAID's authority to donate to WFP operations 
derives from Title II of the Agricultural Trade Development and 
Assistance Act of 1954 (P.L. 480). Title II authorizes the agency to 
donate agricultural commodities to meet international emergency relief 
requirements and carry out nonemergency feeding programs overseas. USDA 
also provides surplus commodities to WFP under section 416(b) of the 
Agricultural Act of 1949. U.S. contributions consisted of in-kind 
donations of commodities such as white wheat and cash donations to 
cover the cost of transporting the commodities from the United States 
to Afghanistan.

Food Assistance Distribution Was Well Managed:

WFP managed the distribution of U.S. and international food assistance 
to Afghanistan effectively despite significant obstacles, including 
harsh weather and a lack of infrastructure to deliver food to 
beneficiaries. To accomplish this, WFP appointed a special envoy to 
direct operations and employed a dedicated staff of local nationals. It 
also used various monitoring and reporting mechanisms to track the 
delivery of food.

WFP's Management Overcame Many Obstacles:

In distributing the food assistance, WFP faced significant obstacles 
related to political and security disturbances in Afghanistan as well 
as physical and environmental conditions. These obstacles included 
limited mobility due to continued fighting between the Taliban and the 
Northern Alliance and coalition forces; religious edicts issued by the 
Taliban limiting the employment of women by international 
organizations; difficult transport routes created by geography, 
climate, and lack of infrastructure (see fig. 4); and attempts by 
Afghan trucking cartels to dramatically increase trucking fees. To 
overcome these obstacles, WFP negotiated with the Taliban to allow the 
movement of food to areas occupied by the Northern Alliance; it also 
threatened to cancel certain projects unless women were allowed to 
continue to work for WFP. Further, WFP found ways to deliver food to 
remote areas, including airlifting food and hiring donkeys (see fig. 
5). In addition, it purchased trucks to supplement a fleet of 
contracted trucks. Using these trucks as leverage against the Afghan 
trucking cartel, WFP forced the cartel to negotiate when the cartel 
attempted to dramatically increase transport fees.

Figure 4: Road Conditions Faced by WFP Truckers in Afghanistan:

[See PDF for image]

[End of figure]

Figure 5: Use of Donkeys to Deliver Food to Remote Areas:

[See PDF for image]

[End of figure]

Special Envoy and Staff Ensured Effective Delivery:

WFP created the position of Special Envoy of the Executive Director for 
the Afghan Region to lead and direct all WFP operations in Afghanistan 
and neighboring countries during the winter of 2001-2002, when it was 
believed that the combination of winter weather and conflict would 
increase the need for food assistance. WFP was thus able to consolidate 
the control of all resources in the region, streamline its operations, 
and accelerate the 
movement of assistance.[Footnote 16] WFP points to the creation of the 
position as one of the main reasons it was able to move record amounts 
of food into Afghanistan from November 2001 through January 2002. In 
December 2001 alone, WFP delivered 116,000 metric tons of food, the 
single largest monthly food delivery within a complex emergency 
operation in WFP's history.

WFP also credits its quick response to its national staff and the 
Afghan truck drivers it contracted. WFP employed approximately 400 
full-time national staff during 1999-2002. These staff established and 
operated an extensive logistics system and continued operations 
throughout Afghanistan, including areas that international staff could 
not reach owing to security concerns, and during periods when 
international staff were evacuated from the country. The truckers who 
moved the food around the country continued working even during the 
harshest weather and in areas that were unsafe because of ongoing 
fighting and banditry.

WFP Monitoring Shows Effective Distribution and Negligible Losses:

WFP uses a number of real-time monitoring mechanisms to track the 
distribution of commodities in Afghanistan, and the data we reviewed 
suggested that food distributions have been effective and losses 
minimal. (For a description of WFP's monitoring procedures, see app. 
III.) During our visits to project and warehouse sites in Afghanistan, 
we observed orderly and efficient storage, handling, and distribution 
of food assistance.[Footnote 17] WFP's internal auditor reviewed WFP 
Afghanistan's monitoring operations in August of 2002 and found no 
material weaknesses. USAID has also conducted periodic monitoring of 
WFP activities without finding any major flaws in WFP's operations. In 
addition, most of the implementing partners we contacted were familiar 
with WFP reporting requirements. However, 10 of the 14 implementing 
partners we contacted commented unfavorably on WFP's project monitoring 
efforts, stating that monitoring visits were too infrequent. Finally, 
WFP's loss reporting data indicated that only 0.4 percent of the 
commodities was lost owing to theft, spoilage, mishandling, or other 
causes.

Inadequate International Support Disrupted Food Assistance; U.S. 
Contributions Costly and Slow:

Inadequate and untimely donor support disrupted WFP's food assistance 
efforts in 2002 and could disrupt efforts in 2003; in addition, U.S. 
assistance to Afghanistan, both through WFP and the Department of 
Defense, was costly. In 2002, interruptions in support forced WFP to 
delay payments of food, curtail the implementation of new projects, and 
reduce the level of rations provided to repatriating refugees. WFP 
expressed concern that donor support in 2003 may be similarly affected, 
as a growing number of international emergencies and budgetary 
constraints could reduce the total funding available for food 
assistance to Afghanistan.[Footnote 18] In addition, WFP could have 
delivered more food and reduced delivery times if the United States had 
provided either cash or regionally purchased commodities instead of 
shipping U.S.-produced commodities and airdropping humanitarian daily 
rations.

Limited International Donor Support Disrupted Food Assistance in 2002, 
Could Disrupt Efforts in 2003:

Obtaining donor support for the emergency food assistance operation for 
the April 2002 through December 2002 period was difficult owing to the 
donor community's inadequate response to WFP's appeal for 
contributions. WFP made its initial appeal in February 2002 for the 
operation and it made subsequent appeals for donor support throughout 
the operation. The operation was designed to benefit 9,885,000 Afghans 
over a 9-month period, through the provision of 543,837 metric tons of 
food at a cost of over $295 million.[Footnote 19] It was also intended 
to allow WFP to begin to shift from emergency to recovery operations 
with particular emphasis on education, health, and the agricultural 
sector. When the operation began in April 2002, WFP's Kabul office 
warned that it might have to stop or slow projects if donors did not 
provide more support. At that time, WFP had received only $63.9 
million, or 22 percent of the required resources. The United States 
provided most of this funding. (See app. IV for a list of donors and 
their contributions for the operation.) From April through June--the 
preharvest period when Afghan food supplies are traditionally at their 
lowest point--WFP was able to meet only 51 percent of the planned 
requirement for assistance. WFP's actual deliveries were, on average, 
33 percent below actual requirements for the 10-month period April 
2002-January 2003. Figure 6 illustrates the gaps in the operation's 
resources for the 10-month period.

Figure 6: Resource Requirements vs. Actual Deliveries for WFP Emergency 
Food Assistance Operation in Afghanistan, April 2002-January 2003:

[See PDF for image]

Note: The large drop in requirements from July through August resulted 
from the suspension of free food distribution during the harvest 
period. WFP suspended this program in an effort to prevent its 
assistance from negatively affecting the price of domestically produced 
wheat in Afghanistan. The increase in requirements from October through 
December resulted from the need to stockpile food for vulnerable 
populations during the winter.

[End of figure]

Lack of timely donor contributions and an increase in the number of 
returning refugees forced WFP and its implementing partner, the UN High 
Commissioner for Refugees, to reduce from 150 to 50 kilograms the 
rations provided to help returning refugees and internally displaced 
persons reestablish themselves in their places of origin. The rations 
are intended to enable these groups to sustain themselves long enough 
to reestablish their lives; reducing the rations may have compromised 
efforts to stabilize population movements within Afghanistan. The lack 
of donor support also forced WFP and its implementing partners to delay 
for up to 10 weeks, in some cases, the compensation promised to Afghans 
who participated in the food-for-work and food-for-asset-creation 
projects, resulting in a loss of credibility in the eyes of the Afghans 
and nongovernmental organizations. Similarly, because of resource 
shortages, WFP had to delay for up to 8 weeks in-kind payments of food 
in its civil service support program, intended to help the new 
government establish itself, and it never received enough contributions 
to provide civil servants with the allocation of tea they were to be 
given as part of their support package. In addition, WFP was forced to 
reduce the number of new projects it initiated, thus limiting the level 
of reconstruction efforts it completed.

In January 2003, WFP expressed concern that the problems it encountered 
with donor support in 2002 could recur in 2003. Despite the expansion 
of agricultural production in 2002 because of increased rainfall, 6 
million Afghans will require food assistance in 2003. Although the 
United States was the largest donor of food assistance to Afghanistan 
in 2002, the U.S. contribution may be smaller in 2003 than in previous 
years owing to reduced surpluses of commodities, higher commodity 
prices, and competing crises in Africa, North Korea, and Iraq.[Footnote 
20] The UN forecasts Afghan cereal production for July 2002 through 
June 2003 at 3.59 million metric tons, a cereal import requirement of 
1.38 million metric tons, and Afghan commercial food imports at 911,000 
metric tons. Thus, an estimated total deficit of 469,000 metric tons 
remains to be covered in the 12-month period by international food 
assistance.

U.S. Food Assistance Contributions Were Costly and Inefficient:

The U.S.-produced commodities and humanitarian daily rations provided 
by the United States to Afghanistan resulted in lower volumes of food 
than if the United States had provided regionally purchased commodities 
or cash donations. If it had provided WFP with cash or commodities from 
countries in the Central Asia region, the United States could have 
eliminated ocean freight costs. We estimated that the savings in 
freight costs would have enabled WFP to provide food assistance to 
approximately 685,000 additional people for 1 year. In addition, we 
estimated that if the United States had donated cash or regionally 
purchased commodities instead of air-dropping rations, WFP could have 
provided food assistance for another 1.0 million people for a year.

U.S.-Produced Commodities Raised Costs and Slowed Delivery:

Most of the food assistance that the United States donated to 
Afghanistan in 1999-2002 was provided through WFP as in-kind donations 
of U.S. agricultural products as well as cash to cover shipping and 
freight costs. Since the commodities were purchased in the United 
States, much of the cost of the assistance represented shipping and 
freight costs rather than the price of the commodities. Figure 7 
provides a breakdown of the costs associated with U.S. food assistance 
to Afghanistan from 1999 through 2002. (See app. V for additional cost 
data.):

Figure 7: Costs for U.S. Food Assistance to Afghanistan, Fiscal Years 
1999-2002:

[See PDF for image]

Legend:

Admin. and misc. = administrative and miscellaneous. Includes 
administrative costs associated with the delivery of assistance:

ITSH= internal transport, storage, and handling within Afghanistan:

Inland freight = freight costs from port of arrival to Afghan border:

Ocean freight = freight costs from U.S. port to port of arrival:

[End of figure]

We estimated that if the United States had provided cash or regionally 
purchased commodities instead of U.S.-produced commodities in 2002, WFP 
could have purchased approximately 103,000 additional metric tons of 
commodities and saved 120 days in delivery time. WFP officials in Rome 
and Cairo[Footnote 21] stated that cash was greatly preferable to in-
kind donations because it allows for flexibility and for local and 
regional purchases. Other contributors to WFP efforts in Afghanistan 
have provided cash, allowing WFP to make the purchases it deemed most 
expedient, including purchases from Central Asian countries that 
produced large surpluses in 2002.[Footnote 22] Ninety-three percent of 
the commodities WFP purchased for the emergency operation that began in 
April 2002 (157,128 metric tons) were from Kazakhstan and 
Pakistan.[Footnote 23] WFP also stated that it could have saved 
approximately 120 days in delivery time if it had received U.S. 
contributions in cash that it could have used for regional purchases.

Although the commodity costs and some of the freight costs for regional 
purchases are lower, the largest portion of the savings from regional 
purchases comes from eliminating ocean freight costs. In 2002, USDA 
spent $5.6 million on ocean freight, or 31 percent of the value of the 
aid it provided to Afghanistan. USAID spent $29.4 million on ocean 
freight, or 18.3 percent of the value of the aid it provided to 
Afghanistan. Overall, USDA and USAID spent approximately $35.0 million 
on ocean freight and commissions, or 19.6 percent of the total value 
($178,068,786) of the food aid they provided through WFP to 
Afghanistan. Had this money been spent on regional purchases instead of 
on ocean freight, it could have paid for 103,000 additional metric tons 
of commodities, or enough to provide food assistance for approximately 
685,000 people for 1 year.[Footnote 24] However, the laws governing the 
main food assistance programs under which most of the U.S. assistance 
was provided to Afghanistan through WFP do not provide for USAID and 
USDA to purchase food assistance commodities regionally or provide cash 
to WFP to make regional purchases. All of the assistance must be 
provided in the form of U.S. commodities, and 75 percent of the 
commodities by weight must be shipped on U.S.-flag vessels.[Footnote 
25] According to USDA, this requirement referred to as "cargo 
preference" accounts for 9 percent of the cost of U.S. food assistance 
shipments worldwide. In this case, it accounted for approximately $16 
million of the $35 million in ocean freight. In prior reports we 
reported that the most significant impact of the cargo preference 
requirement on U.S. food assistance programs is the additional costs 
incurred.[Footnote 26] Using U.S.-flag vessels reduces funds available 
for purchasing commodities, thus the amount of food delivered to 
vulnerable populations is decreased. In its 2002 annual assessment of 
management performance, the Office of Management and Budget concluded 
that U.S. food assistance programs would be more cost effective and 
flexible if the requirement to ship U.S. food assistance on U.S.-flag 
vessels was eliminated. In commenting on a draft of this report, USDA 
stated that consideration should be given to waiving cargo preference 
requirements in specific food aid situations.

In February 2003, the President announced a new humanitarian $200 
million Famine Fund. Use of the fund will be subject to presidential 
decision and will draw upon the broad disaster assistance authorities 
in the Foreign Assistance Act. According to USAID, these authorities 
allow the U.S. government to purchase commodities overseas to meet 
emergency food assistance needs. However, this authority does not 
extend to the United States' fiscal year 2003 $2.6 billion food 
assistance programs under existing food assistance legislation.

Humanitarian Daily Rations Were Expensive and Inefficient:

The U.S. Department of Defense's humanitarian daily ration program was 
a largely ineffective and expensive component of the U.S. food 
assistance effort. The program was initiated to alleviate suffering and 
convey that the United States was waging war against the Taliban, not 
the Afghan people. However, the program's public relations and military 
impact have not been formally evaluated. Airdrops of the humanitarian 
daily rations were intended to disperse the packets over a wide area, 
avoiding the dangers of heavy pallet drops or having concentrations of 
food fall into the hands of a few. On October 8, 2001, U.S. Air Force 
C-17s began dropping rations on various areas within Afghanistan. Drops 
averaged 35,000 packets per night (two planeloads) and ended on 
December 21, 2001. In 198 missions over 74 days, the Air Force dropped 
2,489,880 rations (see fig. 8).[Footnote 27]

Figure 8: Humanitarian Daily Rations:

[See PDF for image]

Note: A ration packet measures 8.5 by 12.5 inches, weighs about 2.2 
pounds, and contains a complete set of meals for 1 day for one person, 
totaling approximately 2,200 calories. The contents are chosen to meet 
strict dietary considerations and as such are completely vegetarian.

[End of figure]

According to WFP, one of the major problems with the ration program was 
the lack of any assessment to identify the needs of the target 
populations or their locations. WFP representatives were part of the 
coordination team located at Central Command in late 2001 when the 
airdrops were made. These representatives provided the Defense 
Department with general information on drought-affected areas but were 
not asked to provide information on specific areas to target. According 
to Department of Defense officials, the drop areas were selected based 
on consultations with USAID staff familiar with the situation in 
Afghanistan.

Defense officials told us that the rations are an expensive and 
inefficient means of delivering food assistance and were designed to 
relieve temporary food shortages resulting from manmade or natural 
disasters--not, as in Afghanistan, to feed a large number of people 
affected by a long-term food shortage. Defense officials responsible 
for the ration program stated that the humanitarian, public relations, 
and military impact of the effort in Afghanistan had not been 
evaluated. According to these officials, anecdotal reports from Special 
Forces soldiers indicated that vulnerable populations did receive the 
food and that the rations helped to generate goodwill among the Afghan 
people. However, reports from nongovernmental organizations in 
Afghanistan indicated that often the rations went to the healthiest, 
since they were able to access the drop zone most quickly, and were 
hoarded by a few rather than distributed among the population.

The cost of the rations was $4.25 per unit, or $10,581,990 for the 
approximately 2.5 million dropped. The total cost of the program was 
$50,897,769, or $20.44 per daily ration. Delivery cost is estimated at 
$16.19 per unit, based on the difference in the ration cost and the 
department's total expenditure. The rations accounted for only 2,835 
metric tons out of the total of 365,170 metric tons, or .78 percent of 
the total weight of food aid delivered in fiscal year 2002. However, 
the cost of the rations equals 28.6 percent of the $178,068,786 that 
USAID and USDA spent on emergency assistance to Afghanistan from 
October 2001 through September 2002. If the United States had bought 
traditional food assistance commodities regionally instead of dropping 
the 2,835 metric tons of rations, it could have purchased approximately 
118,000 metric tons of food, enough to provide food assistance to 1.0 
million people for 1 year.

Agricultural Assistance Has Had Limited Impact and Lacks Coordination, 
and Major Obstacles Jeopardize Food Security and Political Stability:

The U.S. and international community's agricultural reconstruction 
efforts in Afghanistan have had limited impact, coordination of the 
assistance has been fragmented, and significant obstacles jeopardize 
Afghanistan's long-term food security and political stability. Because 
of drought and adverse political conditions, agricultural assistance 
provided by the international community has not measurably improved 
Afghanistan's long-term food security. In 2002, collective efforts to 
coordinate reconstruction assistance, especially with the Afghan 
government, were ineffectual and, as a result, no single operational 
strategy has been developed to manage and integrate international 
agricultural assistance projects. Finally, the inadequacy of proposed 
agricultural assistance, and the increase in domestic terrorism, 
warlords' control of much of the country, and opium production all 
present obstacles to the international community's goal of achieving 
food security and political stability in Afghanistan.

Impact of Agricultural Assistance Limited by Drought and Political 
Factors:

For most of the period 1999-2002, because of war and drought, FAO, 
bilateral donors, and more than 50 nongovernmental organizations in 
Afghanistan focused resources primarily on short-term, humanitarian 
relief; consequently, the impact of this effort on the agricultural 
sector's long-term rehabilitation was limited. The assistance was 
provided in an effort to increase short-term food security and decrease 
Afghanistan's dependence on emergency food assistance. During most of 
the 4-year period, FAO provided $28 million in assistance to 
Afghanistan partly under the UN Development Program's (UNDP) Poverty 
Eradication and Community Empowerment program and partly as donor-
funded response to the drought.[Footnote 28] The poverty eradication 
program ended in 2002, but FAO continues its projects in Afghanistan. 
FAO's short-term activities focus on efforts to enable war-and drought-
affected populations to resume food production activities. These 
activities include providing agricultural inputs such as tools, seed, 
and fertilizer; controlling locusts; and making repairs to small-scale 
irrigation systems (see fig. 9). Its longer-term activities include, 
among other things, the establishment of veterinary clinics, assistance 
in the production of high-quality seed through 5,000 contracted Afghan 
farmers, and horticulture development. From 1999 to 2002, bilateral 
efforts focused on the distribution of agricultural inputs and the 
repair of irrigation systems. USAID activities currently include 
developing a market-based distribution system for agricultural inputs 
as well as distributing high-quality seed.[Footnote 29] As of March 
2002, at least 50 of the approximately 400 national and international 
nongovernmental organizations working in Afghanistan were involved in 
agriculture-related assistance, including providing agricultural 
inputs, farmer training, microcredit, and the construction of wells.

Figure 9: FAO Irrigation Rehabilitation Project:

[See PDF for image]

[End of figure]

For most of the 4-year period, the rise of the Taliban, the continuing 
conflict with the Northern Alliance, and the ongoing drought prevented 
the international community from shifting from short-term relief 
projects to longer-term agricultural rehabilitation projects and 
reversed earlier advancements in agricultural production. For example, 
by 1997, agriculture in some areas had returned to prewar levels, and 
Afghanistan as a whole had reached 70 percent self-sufficiency in the 
production of cereals. At the time, assistance agencies were planning 
to implement longer-term assistance activities but were unable to do so 
owing to drought and conflict. These same factors resulted in decreases 
in cereal production and livestock herds of 48 percent and 60 percent, 
respectively, from 1998 through 2001. In 2002, a number of longer-term 
agricultural rehabilitation efforts were started, including efforts by 
USAID to reestablish agricultural input and product markets. However, 
these efforts have not been evaluated, and it is too early to determine 
their sustainability after donor assistance ends or their long-term 
impact.

Weak Assistance Coordination in 2002 Hindered Afghan Government's 
Involvement and Development of Operational Strategy:

International assistance, including agricultural assistance, was not 
well coordinated in 2002, and, as a result, the Afghan government was 
not substantively integrated into the agricultural recovery effort and 
lacks an effective operational strategy. In December 2002, the Afghan 
government and the international community instituted a new mechanism, 
the Consultative Group, to improve coordination. However, the 
Consultative Group is similar in purpose and structure to a mechanism 
used earlier in 2002, the Implementation Group, and does not surmount 
the obstacles that prevented the Implementation Group's success. 
Because of the lack of coordination, the Afghan government and the 
international community have not developed a single operational 
strategy to direct the agricultural rehabilitation effort; instead, all 
of the major assistance organizations have independent strategies. 
Although documents prepared by the Afghan government and others to 
manage assistance efforts contain some of the components of an 
effective operational strategy, these components have not been combined 
in a coherent strategy. The lack of an operational strategy hinders 
efforts to integrate projects, focus resources, empower Afghan 
government ministries, and make the international community more 
accountable.

Assistance Coordination Was Weak in 2002:

Despite efforts to synchronize multiple donors' initiatives in a 
complex and changing environment, coordination of international 
assistance in general, and agricultural assistance in particular, was 
weak in 2002. According to the UN, assistance coordination refers to a 
recipient government's integration of donor assistance into national 
development goals and strategies. From the beginning of the assistance 
effort in 2002, donors were urged to defer responsibility for 
assistance coordination to the Afghan government as stipulated in the 
Bonn Agreement.[Footnote 30] According to the UN, coordination rests 
with the Afghan government, efforts by the aid community should 
reinforce national authorities, and the international community should 
operate, and relate to the Afghan government, in a coherent manner 
rather than through a series of disparate relationships.[Footnote 31] 
The Security Council resolution that established the UN Assistance 
Mission in Afghanistan goes further; it states that reconstruction 
assistance should be provided through the Afghan government and urges 
the international community to coordinate closely with the 
government.[Footnote 32]

In April 2002, the Afghan government attempted to exert leadership over 
the highly fragmented reconstruction process. To accomplish this task, 
the government published its National Development Framework. The 
framework provides a vision for a reconstructed Afghanistan and broadly 
establishes national goals and policy directions.[Footnote 33] The 
framework is not intended to serve as a detailed operational plan with 
specific objectives and tasks that must be pursued to accomplish 
national goals. Also, in 2002, the Afghan government established a 
government-led coordination mechanism, the Implementation Group (see 
app. VI for detailed descriptions and a comparison of the coordinating 
mechanisms). The intent of the Implementation Group was to bring 
coherence to the international community's independent efforts and 
broad political objectives, such as ensuring Afghanistan does not 
become a harbor for terrorists. The mechanism's structure was based on 
the National Development Framework. Individual coordination groups, led 
by Afghan ministers and composed of assistance organizations, were 
established for each of the 12 programs contained in the framework.

The Implementation Group mechanism proved to be largely ineffective. 
Officials from the Afghan government, the UN, the Department of State, 
and USAID, as well as a number of nongovernmental bodies, expressed 
concern over the lack of meaningful and effective coordination of 
assistance in Afghanistan in 2002. For example, a high-ranking WFP 
official in Afghanistan said that coordination efforts since September 
11, 2002, paid only "lip-service" to collaboration, integration, and 
consensus. In August 2002, the Ministers of Foreign Affairs, Rural 
Reconstruction and Development, Irrigation, and Agriculture stated that 
the donor community's effort to coordinate with the government was poor 
to nonexistent. A USAID official characterized the coordination of 
reconstruction in 2002 as an "ugly evolution" and "the most complex 
post-conflict management system" he had ever seen.

The ineffectiveness of the Implementation Group mechanism resulted from 
its inability to overcome several impediments. First, each bilateral, 
multilateral, and nongovernmental assistance agency has its own 
mandate, established by implementing legislation or charter, and 
sources of funding, and each agency pursues development efforts in 
Afghanistan independently. Second, the international community asserts 
that the Afghan government lacks the capacity and resources to 
effectively assume the role of coordinator and, hence, these 
responsibilities cannot be delegated to the government. Third, no 
single entity within the international community has the authority and 
mandate to direct the efforts of the myriad bilateral, multilateral, 
and nongovernmental organizations providing agricultural assistance to 
Afghanistan.[Footnote 34] Finally, efforts to coordinate agricultural 
assistance were further complicated because the Ministries of 
Agriculture, Irrigation, and Rehabilitation and Rural Development share 
responsibility for agriculture development.

Efforts to Improve Coordination Have Been Implemented:

In December 2002, the Afghan government instituted a new coordination 
system, the Consultative Group mechanism.[Footnote 35] The overall 
objective of the Consultative Group in Afghanistan is to increase the 
effectiveness and efficiency of assistance coordination in support of 
goals and objectives contained in the National Development 
Framework.[Footnote 36] According to the Afghan government, the 
program-level consultative groups established under this mechanism 
provide a means by which the government can engage donors, UN agencies, 
and nongovernmental organizations to promote specific national programs 
and objectives presented in the government's National Development 
Framework and the projects articulated in the Afghan National 
Development Budget.[Footnote 37] According to advisors to the Afghan 
government, the Consultative Group mechanism provides a real 
opportunity for donors to provide focused support for policy 
development, project preparation, implementation, monitoring, and 
evaluation.

The Consultative Group mechanism in Afghanistan evolved out of the 
Implementation Group and is similar in its National Development 
Framework-based hierarchal structure, the role of the Afghan 
government, the membership and leadership of sector specific groups, 
and stated goals (see app. VI). One difference between the 
Implementation and Consultative Group mechanisms is that, since the 
establishment of the latter, the Afghan government has asked donor 
government and assistance organizations to categorize their assistance 
projects under the subprograms in the National Development Framework 
and to direct funding toward the projects in the Afghan National 
Development Budget.

Despite the effort to develop a more effective coordination mechanism, 
the Consultative Group mechanism has not surmounted the conditions that 
prevented the Implementation Group from effectively coordinating 
assistance. For example, in 2003, donor governments and assistance 
agencies have continued to develop their own strategies, as well as 
fund and implement projects outside the Afghan government's national 
budget. In addition, agricultural assistance is divided up among 
several consultative groups including the groups for natural resources 
management and livelihoods. Further, unlike food assistance where 
donors primarily use one agency, WFP, for channeling resources, donors 
continue to use a variety of channels for their agriculture assistance. 
Although the Afghan government asserts that it is assuming a greater 
level of leadership over the coordination effort, as of May 2003, we 
could not determine whether the new coordination mechanism would be 
more successful than earlier efforts.

Lack of Coordination Prevented Development of Operational Strategy:

Because of the inadequate coordination of agricultural assistance, the 
Afghan government and the international community have not developed an 
operational agricultural sector strategy. Each assistance agency has 
published its own development strategy that addresses agriculture and 
numerous other sectors. The Consultative Group mechanism and the 
National Development Framework, as well as other documents prepared by 
the Afghan government and others to manage assistance efforts, contain 
some of the components of an effective operational strategy, such as 
measurable goals and impediments to their achievement. However, these 
components have not been incorporated in a single strategy. Without an 
integrated operational strategy, jointly developed by the Afghan 
government and the international community, the Afghan government lacks 
a mechanism to manage the agricultural rehabilitation effort, focus 
limited resources, assert its leadership, and hold the international 
donor community accountable.[Footnote 38]

Assistance Agencies Have Developed Separate Strategies:

No donor has taken the lead in the agricultural sector; consequently, 
multilateral, bilateral, and nongovernmental organizations, including 
the UN, FAO, the Asian Development Bank, the World Bank, USAID, and 
others, have prepared individual strategies that address, to varying 
degrees, agricultural reconstruction and food security.[Footnote 39] 
However, these strategies lack measurable national goals for the sector 
and have not been developed jointly with the Afghan government. For 
example, in August 2002, the Minister of Agriculture stated, "The 
ministry does not know the priorities of the international community 
for the agricultural sector, how much money will be spent, and where 
the projects will be implemented." FAO claimed that the Ministry of 
Agriculture had endorsed FAO's agricultural rehabilitation strategy. 
However, no letter of agreement or memorandum of understanding between 
the FAO and the ministry documents the acceptance of the strategy. The 
Minister of Agriculture told us, in December 2002, that the ministry 
had not endorsed FAO's latest strategy. Further, the Ministry of 
Agriculture presented a list of more than 100 prioritized 
rehabilitation projects to the international community. As of late 
December 2002, the international community had not responded regarding 
the ministry's proposed projects.

Components of an Operational Strategy Have Not Been Integrated into a 
Single Document:

Although Consultative Group mechanism-related documents, the Afghan 
National Development Framework, and other documents prepared by the 
Afghan government and others to manage assistance efforts contain some 
of the components of an effective operational strategy, these 
components have not been incorporated in a single strategy. For an 
operational agricultural strategy to be effective, all relevant 
stakeholders must participate in its formulation. In this case, 
stakeholders include the Afghan Ministries of Agriculture and 
Irrigation and key nongovernmental, multilateral, and bilateral 
development organizations. Further, such strategies must establish 
measurable goals, set specific time frames, determine resource levels, 
and delineate responsibilities. For example, in Afghanistan, one such 
goal might be to increase the percentage of irrigated land by 25 
percent by 2004 through the implementation of $100 million in FAO-led 
irrigation projects in specific provinces. In addition, an operational 
strategy should identify external factors that could significantly 
affect the achievement of goals and include a schedule for future 
program evaluations.[Footnote 40] Stakeholders should implement the 
strategy through projects that support the measurable goals of the 
strategy and broader policy objectives, such as those contained in the 
Afghan Government's National Development Framework (see fig. 10).

Figure 10: Hierarchy of Strategies for Agricultural Sector 
Reconstruction:

[See PDF for image]

[End of figure]

The Implementation Group and its successor, the Consultative Group, as 
well as the National Development Framework and other documents, contain 
some of the essential elements of an operational strategy. These 
elements include the involvement of key stakeholders, the development 
of some measurable objectives, and the identification of external 
factors that could affect the achievement of goals. However, since the 
National Development Framework is a general national strategy and not a 
detailed operational strategy, it is sufficiently broad that any 
assistance to the agricultural sector could be considered supportive of 
the framework, even if the assistance were not well targeted or made no 
significant impact. In addition, the various elements of an effective 
operational strategy that are contained in the National Development 
Framework and other documents have not been effectively applied, nor 
has a single agricultural sector strategy incorporating all of these 
elements been developed.

The UN Assistance Mission for Afghanistan's management plan endorses 
the formulation of joint strategies for reconstruction. In late 
December 2002, Afghanistan's Minister of Agriculture told us that he 
would welcome the development of a joint Afghan-international 
agricultural sector strategy containing clear objectives, measurable 
goals, concrete funding levels, and clearly delineated 
responsibilities. In January 2003, FAO's Assistant Director-General of 
Technical Cooperation stated that FAO would welcome the opportunity to 
assist the Ministry of Agriculture in preparing a strategy. The 
Consultative Group mechanism could serve as a vehicle to support the 
development of such a strategy. In March 2003, Afghan government 
advisors told us that consultative groups could develop strategies 
based on the subprograms contained in the National Development 
Framework and National Development Budget. Proposals for the 
development of strategies pertaining to natural resources management, 
including agriculture, have been drafted, and support for these 
proposals is being sought from the international community.

Lack of Operational Agricultural Sector Strategy Limits Integration and 
Oversight:

The lack of an operational agricultural sector strategy hinders efforts 
to integrate disparate projects, focus limited assistance resources, 
place Afghan government ministries in a leadership role, and make the 
international community more accountable to the Afghan government. In 
its October 2002 National Development Budget, the Afghan government 
cited the lack of a strategic framework for the natural resources 
management sector, including agriculture, as an impediment to 
rehabilitation. Absent an operational strategy, the Afghan government 
lacks a mechanism to:

* integrate disparate projects into an effective agricultural 
rehabilitation program,

* manage finite resources so as to ensure the greatest return on 
agricultural investment, and:

* guide the efforts of the international community and assert the 
Afghan government's leadership in agricultural reconstruction.

Finally, an operational agricultural sector strategy that includes 
measurable goals and the means to assess progress against those goals 
could increase accountability.[Footnote 41] Because no comprehensive 
integrated strategy exists, the Afghan government lacks the means to 
hold the international assistance community accountable for 
implementing the agricultural sector reconstruction effort and 
achieving measurable results.

Limited Funding and Security Problems Present Obstacles to Food 
Security and Political Stability:

Major obstacles to the goal of a food-secure and politically stable 
Afghan state include inadequate assistance funding, as well as a 
volatile security situation, long-standing power struggles among 
warlords, and the rapid increase in opium production. Donor support has 
not met Afghanistan's recovery and reconstruction needs, and future 
funding levels for agricultural assistance may be inadequate to achieve 
the goal of food security and political stability, primarily because 
assistance levels are based on what the international community is 
willing to provide rather than on Afghanistan's needs. Meanwhile, the 
continued deterioration of the security situation, exacerbated by a 
rising incidence of terrorism, the resurgence of warlords, and near-
record levels of opium production, are impeding reconstruction and 
threaten to destabilize the nascent Afghan government.

International Assistance May Be Insufficient to Meet Needs:

Total assistance levels, including those for agricultural 
reconstruction, proposed at the Tokyo donors' conference in January 
2002 do not provide Afghanistan with enough assistance to meet its 
estimated needs.[Footnote 42] The preliminary needs assessment prepared 
for the January 2002 donor's conference in Tokyo estimated that, in 
addition to humanitarian assistance such as food and shelter 
assistance, between $11.4 and $18.1 billion over 10 years would be 
needed to reconstruct Afghanistan (see table 2). Others have estimated 
that much more is required. For example, the Afghan government 
estimated that it would need $15 billion for reconstruction from 2003 
through 2007.

Table 2: Projected Cumulative Funding Requirements for the 
Reconstruction of Afghanistan:

(Billions of dollars).

Low case: 1 year: $1.4; (Billions of dollars): 
2.5 years: $4.2; (Billions of dollars): 5 years: $8.3; (Billions of 
dollars): 10 years: $11.4.

Base case; (Billions of dollars): 1 year: 1.7; (Billions of dollars): 
2.5 years: 4.9; (Billions of dollars): 5 years: 10.2; (Billions of 
dollars): 10 years: 14.6.

High case; (Billions of dollars): 1 year: $2.1; (Billions of dollars): 
2.5 years: $5.5; (Billions of dollars): 5 years: $12.2; (Billions of 
dollars): 10 years: $18.1.

Sources: Asian Development Bank, UNDP, and the World Bank.

Note: Afghanistan Preliminary Needs Assessment for Recovery and 
Reconstruction (Tokyo: January 2002).

[End of table]

In January 2002, donors pledged $5.2 billion for the reconstruction of 
Afghanistan for 2002-2006, or slightly more than half of the base-case 
estimate for 5 years.[Footnote 43] For the period January 2002-March 
2003, the donors pledged $2.1 billion (see app. VII for donor pledges 
and donations).[Footnote 44] As of March 2003, approximately 88 percent 
of the 2002 grant funding had been disbursed. However, only 27 percent, 
or $499 million, was spent on major reconstruction projects such as 
roads and bridges, which are essential for the export of Afghan 
agricultural commodities and the import of foreign agricultural 
supplies. Despite the importance that the United States and the 
international community attach to the Afghan reconstruction effort, 
Afghanistan is receiving less assistance than was provided for other 
recent postconflict, complex emergencies. For example, per capita 
assistance levels have ranged from $193 in Rwanda to $326 in Bosnia, 
compared with $57 for Afghanistan. Given that the livelihood of 22 
million Afghans depends on agriculture, we estimated that if all of the 
assistance had been provided only to people engaged in agriculture, 
each person would have received $67 annually or about 18 cents per day 
for their daily subsistence and agriculture production efforts in 2002. 
If Afghanistan were to receive per capita aid consistent with the 
average amounts provided for other recent postconflict reconstruction 
efforts, in 2002 it would have received $6 billion in international 
assistance, and from 2002 to 2006 it would receive $30 billion, or 
nearly three times the base-case estimate.

Funding May Be Inadequate to Rehabilitate Agricultural Sector:

The funding proposed by donors for food security-related issues is 
limited and may be insufficient to achieve the long-term goals of the 
Afghan government and the international community. Despite the Afghan 
government's estimated annual need of $500 million for agricultural 
rehabilitation, agricultural assistance for Afghanistan in 2003 may 
total approximately $230 million.[Footnote 45] Afghanistan's President 
has emphasized that the goal of food security and political stability 
is the Afghan government's overarching priority, and the United States 
and other donor governments recognize the strong link between stability 
and food security. According to the U.S. Department of State, 
reconstruction is an integral part of the campaign against terrorism: 
the U.S. policy goal in Afghanistan is to create a stable Afghan 
society that is not a threat to itself or others and is not a base for 
terrorism. Because the agricultural sector forms the core of the Afghan 
economy, the pace of the sector's recovery will largely determine the 
rate of overall economic recovery. Sustained investment in the 
agricultural sector, particularly the rehabilitation, upgrading, and 
maintenance of the nation's irrigation infrastructure, is essential for 
the recovery of the Afghan economy and the country's long-term food 
security.[Footnote 46] Despite improvements in agricultural production 
in 2002, owing primarily to increased precipitation, the fundamental 
weakness of Afghanistan's agricultural infrastructure continues to 
threaten overall recovery efforts.

The Ministry of Agriculture estimates that it needs $5 billion over 10 
years to complete 117 key projects and other efforts important for the 
recovery of the sector. Despite these costs, the 2003 Afghan 
development budget for natural resource management, including 
agriculture, is only $155 million. Since the budget is funded almost 
entirely by the donor community, the budget reflects what the 
government expects to receive from the international community, not the 
Afghan government's actual need. Afghan government budget estimates 
indicate that the natural resources management budget will increase to 
$298 million in 2004 and $432 million in 2005. International donors 
have budgeted approximately $230 million for agriculture-related 
assistance in 2003. USAID considers adequate funding a prerequisite for 
the success of the assistance effort and plans to spend approximately 
$50 million on agriculture in 2003 and similar amounts in 2004 and 
2005. USAID funding covers 32 percent of the Afghan government's 2003 
natural resources management program budget of $155 million but only 10 
percent of the Afghan Ministry of Agriculture's estimated annual needs 
of $500 million.[Footnote 47]

Increased Terrorism, Warlords, and Opium Production Are Major Obstacles 
to Food Security and Political Stability:

The goal of a stable Afghan state is threatened by the rise in domestic 
terrorism, long-standing rivalries among warlords, and the rapid 
increase in opium production. In March 2002, in a report to the UN 
Security Council, the UN Secretary General stated that security will 
remain the essential requirement for the protection of the peace 
process in Afghanistan. One year later, in a report to the council, he 
stated that "security remains the most serious challenge facing the 
peace process in Afghanistan." Others in the international community, 
including USAID, consider security as a prerequisite for the 
implementation of reconstruction efforts. In 2002 and early 2003, the 
deteriorating security situation was marked by terrorist attacks 
against the Afghan government, the Afghan people, and the international 
community.[Footnote 48] These incidents have forced the international 
community to periodically suspend agricultural assistance activities, 
disrupting the agricultural recovery effort.

Meanwhile, clashes between the warlords' private armies continue to 
destabilize the country and reduce the Afghan government's ability to 
fund agricultural reconstruction. The warlords foster an illegitimate 
economy fueled by smuggling of arms, drugs, and other goods. They also 
illegally withhold hundreds of millions of dollars in customs duties 
collected at border points in the regions they control, depriving the 
central government of revenues needed to fund the country's 
agricultural reconstruction. The warlords control private armies of 
tens of thousands of armed men. Across Afghanistan, approximately 
700,000 Afghan men are armed, and half of these are combat trained. 
USAID considers the demobilization and integration of these armed men a 
prerequisite for the success of the international recovery 
effort.[Footnote 49] Currently, the unemployment rate in Afghanistan is 
estimated at 50 percent. Without a revitalization of the agricultural 
sector--the engine of the Afghan economy and the main source of 
employment--it is likely that these men will remain in the employ of 
the warlords.

Another destabilizing force that affects agriculture is the illicit 
international trade in Afghan opiates. The drug trade was the primary 
income source of the Taliban and continues to provide income for 
terrorists and warlords.[Footnote 50] On January 17, 2002, the 
President of Afghanistan issued a decree stating that the existence of 
an opium-based economy was a matter of national security and should be 
fought by all means. During the 1990s, Afghanistan became the world's 
leading opium producer accounting for approximately 70 percent of opium 
production worldwide. Despite being a central focus of a number of 
international donors engaged in Afghanistan, opium poppy eradication 
efforts implemented by the Afghan government and the international 
community in 2002 failed. In July 2002, one of Afghanistan's vice 
presidents and leader of the Afghan government's poppy eradication 
campaign, Haji Qadir, was assassinated. In October 2002, the UN Office 
for Drug Control and Crime Prevention estimated that, in 2002, Afghan 
farmers produced 3,400 metric tons of opium.[Footnote 51] This level of 
production equals or exceeds levels achieved in 9 of the last 10 years. 
Total 2002 revenue from opium production totaled $1.2 billion, an 
amount equivalent to 70 percent of total assistance to Afghanistan 
pledged for 2002, or nearly 220 percent more than the Afghan 
government's 2003 operating budget.[Footnote 52]

The UN Drug Control Program also estimated that the average poppy 
farmer earned $4,000 dollars from growing poppies in 2002. Owing to 
continuing drought, a poor agricultural marketing structure, and 
widespread poverty, farmers have turned to poppy cultivation to avoid 
destitution.[Footnote 53] Since the fall of the Taliban, irrigated 
acreage dedicated to wheat production has fallen by 10 percent, 
supplanted by opium poppies. In addition, it is estimated that 30 to 50 
percent of Afghans are involved in opium cultivation. Many of the 
farmers continue to grow opium poppies because they lack the seed and 
fertilizer needed to grow alternative crops that generate revenues 
comparable to those from opium.[Footnote 54]

Conclusions:

The establishment of a new government in Afghanistan has provided the 
Afghan people, the international community, and the United States an 
opportunity to rebuild Afghanistan and create a stable country that is 
neither a threat to itself or its neighbors nor a harbor for 
terrorists. In 2002, U.S. and international food assistance averted 
famine, assisted the return of refugees, and helped to implement 
reconstruction efforts. However, U.S. food assistance and cargo 
shipping legislation limited the United States' flexibility in 
responding quickly to the emergency and providing support to WFP; the 
legislation does not provide for purchasing commodities regionally or 
donating cash to the UN for procuring commodities and requires that 
U.S. commodities be shipped on U.S. flag vessels. Consequently, the 
costs of food assistance were higher and delivery times were greater, 
fewer commodities were purchased, and a smaller number of people 
received food assistance. In addition, a lack of timely and adequate 
overall donor support disrupted WFP's food assistance efforts. 
Meanwhile, in 2003, six million people will require food assistance in 
Afghanistan.

Because the economy remains overwhelmingly agricultural, the pace of 
recovery in the agricultural sector will largely determine the rate of 
Afghanistan's overall recovery. Food assistance alone cannot provide 
food security; Afghanistan's agricultural sector must be rehabilitated. 
Environmental and political problems have limited the impact of the 
international community's agricultural assistance efforts. In 
addition, in 2002, the assistance efforts were not coordinated with 
each other or with the Afghan government. A new coordination mechanism 
established in December 2002 is largely similar to earlier mechanisms, 
and it is too recent for us to determine its effectiveness. Further, 
whereas U.S. and UN agencies, bilateral donors, and nongovernmental 
organizations have drafted numerous overlapping recovery strategies, no 
single Afghan government-supported strategy is directed toward the 
effort to rehabilitate the sector. Meanwhile, funding for the 
agricultural assistance effort is insufficient and the nascent Afghan 
government is plagued with problems stemming from domestic terrorism, 
the resurgence of warlords, and near-record levels of opium production. 
These obstacles threaten the recovery of the agricultural sector and 
the U.S. goals of achieving food security and political stability in 
Afghanistan.

Matter for Congressional Consideration:

To increase the United States' ability to respond quickly to complex 
emergencies involving U.S. national security interests, such as that in 
Afghanistan, Congress may wish to consider amending the Agricultural 
Trade Development and Assistance Act of 1954 (P.L. 83-480), as amended, 
to provide the flexibility, in such emergencies, to purchase 
commodities outside the United States when necessary and provide cash 
to assistance agencies for the procurement of non-U.S.-produced 
commodities. In addition, Congress may wish to amend the Merchant 
Marine Act of 1936, as amended, to allow waiver of cargo preference 
requirements in emergencies involving national security. These 
amendments would enable the United States to reduce assistance costs 
and speed the delivery of assistance, thus better supporting U.S. 
foreign policy and national security objectives.

Recommendations for Executive Action:

To increase the effectiveness of the agricultural assistance effort in 
Afghanistan, we recommend that the Secretary of State and the 
Administrator of the U.S. Agency for International Development work 
through the Consultative Group mechanism to develop a comprehensive 
international-Afghan operational strategy for the rehabilitation of the 
agricultural sector. The strategy should (1) contain measurable goals 
and specific time frames and resource levels, (2) delineate 
responsibilities, (3) identify external factors that could 
significantly affect the achievement of goals, and (4) include a 
schedule for program evaluations that assess progress against the 
strategy's goals.

Agency Comments and Our Evaluation:

We provided a draft of this report to WFP, Department of State, USDA, 
USAID, and Department of Defense and received written comments from 
each agency (see app. VIII, IX, X, XI, and XII respectively). We also 
received technical comments from USDA, the Departments of Defense and 
State, USAID, FAO, and the World Bank, and incorporated information as 
appropriate.

Department of State, USDA, and USAID all commented on our matter for 
congressional consideration related to amending food assistance 
legislation. WFP supported our suggestion that Congress consider 
amending the Agricultural Trade Development and Assistance Act of 1954 
to allow the provision of non-U.S. commodities when such action 
supports U.S. national security. However, State, USDA, and USAID did 
not support the recommendation. Specifically, although State accepted 
our evidence that purchasing commodities from the United States is not 
the most cost-effective method of providing assistance, it believes 
that further study of potential variables, such as regional customs 
fees, taxes, and trucking costs, that may negate cost-benefit savings 
is needed before the act is amended. USAID stated that an amendment is 
not necessary because other authorities under the Foreign Assistance 
Act allow the provision of cash, and the proposed $200 million Famine 
Fund announced by the President in February 2003 would also increase 
the flexibility of U.S. assistance programs. USDA stated that the 
flexibility to quickly respond to humanitarian crises can be achieved 
through means, such as amending cargo shipping legislation, that would 
not adversely affect the provision of U.S. commodities. Specifically, 
USDA suggested adding a national security waiver to the U.S. 
regulations that govern how U.S. assistance is transported to eliminate 
the requirement to use U.S. flag vessels in certain circumstances.

We do not disagree that under broad disaster assistance legislation 
U.S. agencies may provide cash or purchase food aid commodities outside 
the United States. However, we maintain that amending the Agricultural 
Trade Development and Assistance Act of 1954 to allow the provision of 
cash or food commodities outside the United States will greatly improve 
U.S. flexibility in responding to crises that affect U.S. national 
security and foreign policy interests. The act is the principal 
authority for providing food assistance in emergency situations. In 
both 2002 and 2003 over $2 billion in food assistance, the preponderant 
amount of this type of assistance, was dispersed under this authority. 
Amending the act will provide the United States with more flexibility 
to respond rapidly and at lower cost to events that affect U.S. 
national security; this is particularly important given the number and 
magnitude of crises requiring food assistance and decreasing surpluses 
of U.S. commodities. We also agree with USDA that the cargo preference 
requirement adds additional cost to food assistance and should be 
waived in specific situations, and we have adjusted the matter for 
congressional consideration contained in the report on this issue.

In its comments, USDA stated that the report did not provide enough 
evidence about the existence of surpluses in 2002 in the Central Asia 
region. It also stated that if the U.S. had procured greater levels of 
commodities with the savings accrued by purchasing regional versus U.S. 
-origin commodities, the additional commodities would have over 
burdened WFP's logistics system while generating only "marginal savings 
in time and money.":

We have added additional information on the 7.6 million metric ton 2002 
grain surplus in Kazakhstan and Pakistan. We disagree with USDA's 
assertions that additional regionally procured commodities would have 
taxed WFP's logistics system and brought only marginal gains. In 
December 2002, while fighting between coalition forces, the Northern 
Alliance, and the Taliban was still occurring, and winter weather was 
complicating food deliveries, WFP delivered 116,000 metric tons of food 
to Afghan beneficiaries, in the single largest movement of food by WFP 
in a 1-month period. According to WFP, its Afghanistan logistics system 
was capable of routinely moving more than 50,000 metric tons of food 
per month. Further, we disagree with USDA's statement that the 
potential savings in cost and time by purchasing commodities regionally 
are marginal. Savings from the elimination of ocean freight costs could 
have fed 685,000 people for 1 year, and commodities purchased 
regionally are delivered to beneficiaries within weeks of being 
purchased, compared with the 4 months that it can take for commodities 
purchased in the United States.

WFP, the Department of State, USDA, and USAID all agreed with the 
report's conclusion and recommendation pertaining to assistance 
coordination and the need to develop a joint international-Afghan 
agricultural rehabilitation strategy. WFP pointed out that although the 
international assistance effort may have been aided by better 
coordination in 2002, the overall level of assistance might have been 
too small in 2002 to have any long-term impact on the agricultural 
sector. Although USAID agreed with our recommendation, it stated it did 
not want to lead the strategy development effort. We believe that USAID 
should take an active and aggressive role in the development of a joint 
international-Afghan government strategy, because the United States is 
the largest donor to Afghanistan, agriculture rehabilitation is the 
focus of USAID's assistance effort in Afghanistan, and the achievement 
of U.S. goals in Afghanistan is tightly linked to the rehabilitation of 
the country's agricultural sector. According to USAID's assistance 
strategy for Afghanistan, restoring food security is USAID's highest 
priority.

Finally, the Department of Defense focused its comments on the report's 
discussion of the humanitarian daily ration program. Specifically, the 
Department of Defense stated that (1) the report incorrectly 
characterized the ration program as a food assistance program, (2) 
informal evaluations of the program indicated that the program 
alleviated hunger and generated goodwill from the Afghan people toward 
U.S. soldiers, and (3) although the funds used to purchase rations 
could have been used to purchase bulk food, the bulk food could not 
have been delivered to remote areas. The report discusses both the food 
assistance and nonfood assistance aspects of the rations program, and 
we have added information on page 30 about the goodwill generated by 
the rations to the report. Finally, as discussed on page 20 of the 
report, bulk food could have been delivered to remote areas during the 
period of time (October-December 2001) when the ration program was 
implemented. During the month of December 2001, WFP delivered 116,000 
metric tons of food to Afghanistan, a level of food assistance that 
exceeds any 1-month total for any emergency operation in WFP's history.

:

We are sending copies of this report to the Honorable Richard J. 
Durbin, Ranking Minority Member, Subcommittee on Oversight of 
Government Management, the Federal Workforce, and the District of 
Columbia, Committee on Governmental Affairs, and to the Honorable Frank 
R. Wolf, Chairman, Subcommittee on Commerce, Justice, State, and the 
Judiciary, Committee on Appropriations, House of Representatives. We 
also will make copies available to others upon request. In addition, 
the report will be available at no charge on the GAO Web site at http:/
/www.gao.gov.

If you or your staff have any questions about this report, please 
contact me at (202) 512-4347. Other GAO contacts and staff 
acknowledgments are listed in appendix XIII.

Loren Yager, 
Director 
International Affairs and Trade:

Signed by Loren Yager:

[End of section]

Appendixes:

Appendix I: Scope and Methodology:

To examine the management, cost, and sufficiency of U.S. and 
international food assistance since 1999, we reviewed documents 
obtained from the World Food Program (WFP) and the U.S. Agency for 
International Development (USAID). Specifically, we reviewed program 
documentation for recent emergency and special operations; WFP 
Afghanistan Country Office quarterly and annual reports; WFP's 
Emergency Field Operations Manual and Food Aid in Emergencies Redbook; 
country office monitoring guidelines; Afghanistan area office 
strategies; memorandums of understanding and letters of agreement 
signed by WFP and United Nations (UN) agencies, nongovernmental 
organizations, and the Afghan government; and monitoring reports 
prepared by USAID staff.

In addition, we analyzed project monitoring and loss data to determine 
the frequency of monitoring visits, the experience and education level 
of monitors, and the level of commodities lost versus those delivered. 
We did not verify the statistical data provided by WFP. We also 
reviewed donor resource contribution data for recent emergency and 
special operations. We contacted by e-mail, or spoke with, 14 Afghan 
and international nongovernmental organizations[Footnote 55] to obtain 
their views on the delivery of assistance, WFP monitoring and 
reporting, and overall assistance coordination issues. We interviewed 
WFP management and staff at WFP headquarters in Rome, Italy; at the 
Regional Bureau for the Mediterranean, Middle East, and Central Asia, 
in Cairo, Egypt; at the Country Office in Kabul, Afghanistan; and at 
the Area Office in Hirat, Afghanistan. We also interviewed USAID, U.S. 
Department of Agriculture (USDA) and U.S. Department of State staff in 
Washington, D.C., and Kabul; U.S. Department of Defense Staff in 
Washington; the International Security Afghanistan Force, UN 
Development Program (UNDP), and UN Assistance Mission in Afghanistan 
(UNAMA) staff in Kabul; and UN High Commissioner for Refugees staff in 
Kabul and Hirat. Finally, we visited WFP project sites and warehouses 
in Kabul and Hirat. The number of sites visited was limited because of 
constraints placed on our movement within Afghanistan by the U.S. 
Embassy because of security considerations.

We also examined cost data provided by USDA and USAID. The data 
included commodity costs; total ocean freight charges; inland freight; 
internal transport, storage, and handling charges; and administrative 
support costs. We used the data to calculate two additional expenses, 
per USDA statements about the composition of costs and additional costs 
that are not stated on the data sheets. First, the "freight forwarder" 
fees represent 2.5 percent of the total cost of ocean freight. Thus, 
ocean freight charges were divided between freight forwarder fees 
(total freight minus total freight divided by 1.025) and actual freight 
costs (total freight minus freight forwarder fees). This was true for 
both USDA and USAID assistance. In the final analysis, the freight 
forwarder fee was included in the ocean freight cost because it is an 
expense that would not have been incurred if ocean shipping had not 
been used. Second, with each donation to WFP, USDA provides an 
administrative support grant at the rate of 7.5 percent of the total 
value of the donated commodities. We calculated these data accordingly.

We checked all USAID and USDA data for validity, where possible to the 
level of individual shipment. We cross-checked USAID data with USDA 
data. (USAID typically provided only estimated costs for commodities 
for the period 1999-2002. Because USDA conducts almost all commodity 
purchases for USAID, USAID estimates the commodity costs at the time it 
places its order with USDA, based on the current market cost. However, 
because USDA provided actual costs for USAID purchases in 1999, 2000, 
and 2001, the USAID commodity costs we cited for 2002 are based on 
USAID's estimate.) We then compared the cost of the U.S.-purchased 
commodities with the cost of commodities purchased in the Central Asia 
region to determine whether any savings could have been realized by 
purchasing commodities regionally versus buying U.S. commodities. 
Finally, using the level of rations that WFP provides to returning 
refugees, 12.5 kilograms per month, we calculated the amount of food 
assistance that the United States could have purchased and the number 
of people that could have received food assistance if it had purchased 
commodities in the Central Asia region.

Further, we examined the costs associated with the Department of 
Defense's Afghan humanitarian daily ration program, implemented from 
October 2001 through December 2001. Using the level of rations that WFP 
provides to returning refugees, 12.5 kilograms per month, we calculated 
the amount of food assistance that the United States could have 
purchased and the number of people that could have received food 
assistance if it had purchased commodities in the Central Asia region.

In addition, we reviewed relevant food assistance legislation including 
the Agricultural Trade Development and Assistance Act of 1954 (P.L. 83-
480) to determine whether provisions in the law allowed the U.S. 
government to purchase commodities outside the United States or provide 
cash transfers to assistance agencies for the provision of commodities 
from sources other than U.S. suppliers.

To assess U.S. and international agricultural assistance, coordination, 
strategies, and funding intended to help Afghanistan maintain stability 
and achieve long-term food security, we reviewed documentation provided 
by FAO, UNDP, and UNAMA; the World Bank; the Asian Development Bank; 
USAID; and the Afghan Ministries of Agriculture and Animal Husbandry, 
and Irrigation and Water Resources. We reviewed information pertaining 
to past and current coordination mechanisms in the Afghan government's 
National Development Framework and National Development Budget. We 
examined the structure and content of the assistance strategies 
published by FAO, UNDP, UNAMA, the European Commission, the World Bank, 
Asian Development Bank, and USAID, and we examined the proposed funding 
levels contained in each strategy. Using the criteria contained in the 
U.S. Government Performance and Results Act, we examined the strategies 
to determine whether each contained the basic elements of an 
operational strategy articulated in the act. Further, we examined the 
overall assistance funding requirements contained in the January 2002 
UNDP, World Bank, and Asian Development Bank Comprehensive Needs 
Assessment, which served as a guideline for international donor 
contributions for Afghanistan. We interpolated the funding projection 
data to construct annual aid flows, so that the cumulative totals were 
equal to those contained in the assessment. Assuming that the first 
year of data referred to 2002, we applied the U.S. gross domestic 
product deflator to convert the assumed current dollar figures into 
constant 2003 dollars.

Further, we examined security reports produced by the Department of 
Defense and the UN, as well as the UN Office on Drugs and Crime report 
on opium production in Afghanistan, to determine the impact of warlords 
and opium production on food security and political stability. In 
addition, we discussed U.S. and international agricultural assistance 
efforts and food security issues with officials from USAID in 
Washington and Kabul; FAO in Rome and Kabul; UNDP and the Afghan 
Ministries of Communication, Foreign Affairs, Interior, Rural 
Rehabilitation and Development, and Irrigation and Water Resources in 
Kabul; and the Afghan Ministry of Agriculture in Kabul and Washington.

We conducted our review from April 2002 through May 2003 in accordance 
with generally accepted government auditing standards.

[End of section]

Appendix II: World Food Program Projects in Afghanistan, 2002:

Type of project: Free food distribution; Description: Free food is 
delivered to the most vulnerable populations.

Type of project: Supplementary feeding; Description: Malnourished 
children, pregnant and nursing mothers, and people undergoing treatment 
for tuberculosis and leprosy are provided with a blended mix of either 
milled corn and soy or wheat and soy, in addition to sugar and oil, 
through feeding centers, hospitals, clinics, and orphanages.

Type of project: Food for work; Description: Returning refugees, 
internally displaced persons, and people involved in the poppy 
industry, among others, reconstruct and rehabilitate irrigation canals, 
roads, and other infrastructure. The program provides wages in the form 
of food and tools.

Type of project: Food for asset creation; Description: Men and women of 
the community decide which families should receive food. Able-bodied 
households contribute their labor to construct or rehabilitate an 
asset, such as an irrigation canal, that benefits the entire community. 
Those who cannot contribute labor also receive food, and they benefit 
from the community asset.

Type of project: Food for education and support to teachers; 
Description: Food is distributed to students in school to encourage 
families to send their children to school. To encourage families to 
support the education of females, additional food is provided to female 
students. Food is also provided to teachers to supplement their low 
salaries.

Type of project: Food for training; Description: Food is provided to 
women who participate in informal education activities including 
technical skills and literacy training.

Type of project: Food for seed; Description: Food is exchanged for 
improved seed grown by contract farmers. The seed is then sold to other 
farmers.

Type of project: Urban and women's bakeries; Description: Daily rations 
of bread are provided to more than 250,000 people. Women operate 41 of 
the 100 bakeries.

Type of project: Civil servant support; Description: Approximately 
270,000 civil servants were provided with pulses and oil to supplement 
their salaries and help the Afghan government reestablish itself.

Type of project: Refugee and; internally displaced person support; 
Description: Food assistance is provided as part of a resettlement 
package to help people reestablish themselves in their home areas or 
chosen community.

Source: WFP.

[End of table]

[End of section]

Appendix III: Description of WFP Food Assistance Monitoring Mechanisms:

The World Food Program uses a number of mechanisms to minimize losses 
and ensure that its commodities are well managed. The mechanisms 
include real-time automated tracking, periodic monitoring visits to 
project sites, required periodic reports from implementing partners, 
and end-of-project evaluations. The program's global automated tracking 
system, the Commodity Movement and Progress Analysis System, is 
intended to record and report all commodity movement, loss, and damage. 
Each WFP suboffice in Afghanistan has access to the system and employs 
a clerk dedicated to managing it. The system produces a number of 
reports, including stock, damage, and loss reports.

WFP guidelines state that monitoring and reporting are essential parts 
of effective project management in the field, and it is WFP's policy 
not to support any project that cannot be monitored. Monitoring 
activities are intended to assess the status of projects by comparing 
the actual implementation of activities to the project's work plan. The 
responsibility for monitoring projects rests with the program's country 
office in Kabul and five Afghan suboffices located in other cities. 
Each office employs between 6 and 24 local Afghan project 
monitors,[Footnote 56] and WFP has 22 program staff in Afghanistan who 
also monitor projects, in addition to their other duties. WFP's Afghan 
country office has developed monitoring guidelines for its monitors and 
monitoring checklists for each type of activity (e.g., food-for-work, 
food-for-seed, food-for-asset-creation, food-for-education).

According to WFP, monitoring visits include an examination of project 
inputs, current operations, outputs, and immediate effects. Specific 
monitoring activities include an examination of food stocks held by 
implementing partners. The monitors spot-check the weight of randomly 
selected bags in storage and compare the total stock held with WFP 
stock balance reports. The monitors also survey local markets to 
determine whether any WFP food is being resold rather than used by 
beneficiaries. Projects are monitored on a periodic basis. WFP tries to 
visit each project when it starts, during its implementation, and when 
it is completed. The WFP data that we examined indicated that, on 
average, 2.4 monitoring visits were conducted on all projects 
implemented between April 2002 and November 2002 in Afghanistan.

In addition to requiring the project monitoring visits, WFP requires 
its implementing partners to report on the status of projects on a 
monthly basis. WFP project proposals and the letters of agreement 
signed by WFP and its implementing partners stipulate that monthly and 
end-of-project reports must be submitted to WFP. The end-of-project 
reports include an assessment of the achievement of project objectives 
and a breakdown of budget expenditures.

[End of section]

Appendix IV: Donor Contributions to World Food Program Emergency 
Operation 10155 as of May 12, 2003:

Donor: Total (appeal): U.S. dollars: 287,943,598; Percentage of 
total: 100.00%; Tons: 550,171; Percentage of total: 100.00%.

Donor: Australia; U.S. dollars: 4,087,975; Percentage of 
total: 1.42%; Tons: 9,567; Percentage of total: 
1.74%.

Donor: Belgium; U.S. dollars: 985,222; Percentage of 
total: 0.34%; Tons: 2,847; Percentage of total: 
0.52%.

Donor: Canada; U.S. dollars: 1,610,097; Percentage of 
total: 0.56%; Tons: 4,662; Percentage of total: 
0.85%.

Donor: Denmark; U.S. dollars: 3,199,194; Percentage of 
total: 1.11%; Tons: 6,648; Percentage of total: 
1.21%.

Donor: EC--EuropeAid; U.S. dollars: 21,897,321; 
Percentage of total: 7.60%; Tons: 63,834; Percentage 
of total: 11.60%.

Donor: Faroe Islands; U.S. dollars: 329,412; Percentage of 
total: 0.11%; Tons: 897; Percentage of total: 
0.16%.

Donor: Finland; U.S. dollars: 437,445; Percentage of 
total: 0.15%; Tons: 1,303; Percentage of total: 
0.24%.

Donor: Germany; U.S. dollars: 1,985,560; Percentage of 
total: 0.69%; Tons: 6,497; Percentage of total: 
1.18%.

Donor: India; U.S. dollars: 7,444,108; Percentage of 
total: 2.59%; Tons: 9,526; Percentage of total: 
1.73%.

Donor: Ireland; U.S. dollars: 469,484; Percentage of 
total: 0.16%; Tons: 1,512; Percentage of total: 
0.27%.

Donor: Italy; U.S. dollars: 8,127,321; Percentage of 
total: 2.82%; Tons: 16,091; Percentage of total: 
2.92%.

Donor: Japan--private; U.S. dollars: 442,881; Percentage 
of total: 0.15%; Tons: 1,320; Percentage of total: 
0.24%.

Donor: Japan; U.S. dollars: 17,818,002; Percentage of 
total: 6.19%; Tons: 45,436; Percentage of total: 
8.26%.

Donor: Korea, Republic of; U.S. dollars: 40,000; 
Percentage of total: 0.01%; Tons: 109; Percentage of 
total: 0.02%.

Donor: Luxembourg; U.S. dollars: 490,678; Percentage of 
total: 0.17%; Tons: 1,466; Percentage of total: 
0.27%.

Donor: Netherlands; U.S. dollars: 4,374,453; Percentage of 
total: 1.52%; Tons: 13,288; Percentage of total: 
2.42%.

Donor: Norway; U.S. dollars: 1,262,626; Percentage of 
total: 0.44%; Tons: 3,809; Percentage of total: 
0.69%.

Donor: Private; U.S. dollars: 37,582; Percentage of total: 
0.01%; Tons: 61; Percentage of total: 0.01%.

Donor: Switzerland; U.S. dollars: 4,039,157; Percentage of 
total: 1.40%; Tons: 8,918; Percentage of total: 
1.62%.

Donor: United Kingdom; U.S. dollars: 5,633,701; Percentage 
of total: 1.96%; Tons: 12,547; Percentage of total: 
2.28%.

Donor: United Nations; U.S. dollars: 185,000; Percentage 
of total: 0.06%; Tons: TBD; 

Donor: United States; U.S. dollars: 156,385,885; 
Percentage of total: 54.31%; Tons: 309,770; 
Percentage of total: 56.30%.

Donor: U.S. friends of WFP; U.S. dollars: 172,020; 
Percentage of total: 0.06%; Tons: 195; Percentage of 
total: 0.04%.

Donor: Multilateral funds; U.S. dollars: 832,005; 
Percentage of total: 0.29%; Tons: 1,035; Percentage 
of total: 0.19%.

Donor: Total (received); U.S. dollars: 242,287,129; 
Percentage of total: 84.14%; Tons: 521,338; 
Percentage of total: 94.76%.

Donor: Shortfall; U.S. dollars: 45,656,469; Percentage of 
total: 15.86%; Tons: 28,833; Percentage of total: 
5.24%.

Legend:

EC = European Community:

WFP = World Food Program:

TBD = to be determined:

Source: WFP.

[End of table]

[End of section]

Appendix V: Cost Data for U.S. Food Assistance to Afghanistan Provided 
to the UN World Food Program, Fiscal Years 1999-2002:

1999: Commodity cost: $15,069,555; Ocean freight: $10,521,204; 
Inland freight: $815,200; ITSH freight: $756,800; Administrative and 
miscellaneous: $1,016,705; Total cost: $28,179,464.

Commodity cost: 2000: 53.48%: Ocean freight: 2000: 37.34%; Inland 
freight: 2000: 2.89%; ITSH freight: 2000: 2.69%; Administrative and 
miscellaneous: 2000: 3.61%; Total cost: 2000: [Empty].

2000: Commodity cost: $18,282,825; Ocean freight: $12,234,100; 
Inland freight: $2,905,600; ITSH freight: $3,874,400; Administrative 
and miscellaneous: $1,131,903; Total cost: $38,428,828.

Commodity cost: 2001: 47.58%; Ocean freight: 2001: 31.84%; Inland 
freight: 2001: 7.56%; ITSH freight: 2001: 10.08%; Administrative and 
miscellaneous: 2001: 2.95%; Total cost: 2001: [Empty].

2001: Commodity cost: $46,866,434; Ocean freight: $20,639,750; 
Inland freight: $3,313,900; ITSH freight: $8,738,300; Administrative 
and miscellaneous: $3,294,616; Total cost: $82,853,000.

Commodity cost: 2002: 56.57%; Ocean freight: 2002: 24.91%; Inland 
freight: 2002: 4.00%; ITSH freight: 2002: 10.55%; Administrative and 
miscellaneous: 2002: 3.98%; Total cost: 2002: [Empty].

2002; Commodity cost: $75,770,144; Ocean freight: $34,920,586; 
Inland freight: $25,987,600; ITSH freight: $39,896,400; Administrative 
and miscellaneous: $1,494,056; Total cost: $178,068,786.

Commodity cost: Total: 42.55%; Ocean freight: Total: 19.61%; Inland 
freight: Total: 14.59%; ITSH freight: Total: 22.40%; Administrative and 
miscellaneous: Total: 0.84%; Total cost: Total: [Empty].

Total; Commodity cost: $155,988,958; Ocean freight: $78,315,640; 
Inland freight: $33,022,300; ITSH freight: $53,265,900; Administrative 
and miscellaneous: $6,937,280; Total cost: $327,530,078.

Annual average percentage; Commodity cost: 50.04%; Ocean freight: 
28.43%; Inland freight: 7.26%; ITSH freight: 11.43%; Administrative and 
miscellaneous: 2.85%; Total cost: 100%.

Percentage of total; Commodity cost: 47.63%; Ocean freight: 23.91%; 
Inland freight: 10.08%; ITSH freight: 16.26%; Administrative and 
miscellaneous: 2.12%; Total cost: 100%.

Legend:

ITSH = Internal Transport, Storage, and Handling:

Sources: GAO analysis of U.S. Department of Agriculture and U.S. Agency 
for International Development data.

[End of table]

[End of section]

Appendix VI: International Donor Assistance Coordination Mechanisms in 
Afghanistan:

Between 1998 and 2003, as circumstances in Afghanistan changed, the 
coordination processes utilized by the international community and the 
Afghan government evolved (see table 3 and figure 11). Beginning in 
1998, the international community employed a strategy of Principled 
Common Programming among United Nations agency, nongovernmental, and 
bilateral donor programs. The international community's aim was to 
establish priorities and projects based on agreed upon goals and 
principles that would form the UN's annual consolidated appeal for 
assistance. To implement Principled Common Programming, a number of 
coordination mechanisms were established, including the Afghan 
Programming Body. The programming body consisted of the Afghan Support 
Group, 15 UN Representatives, and 15 nongovernmental organizations and 
was responsible for making policy recommendations on issues of common 
concern, supporting the UN's annual consolidated appeal for donor 
assistance, and promoting coordination of assistance efforts.[Footnote 
57] The Taliban government had no role in the programming body. The 
programming body was supported by a secretariat; working level 
operations were conducted by a standing committee and thematic groups 
responsible for analyzing needs, developing strategies and policies, 
and setting assistance priorities within their thematic areas (e.g., 
the provision of basic social services). The Afghan Programming Body 
and its standing committee were incorporated into the Implementation 
Group/Program Group process established in 2002. Table 3 describes the 
Afghan assistance coordination mechanisms in place in 2002.

Table 3: Major Assistance Coordination Mechanisms in Afghanistan in 
2002:

Organization/suborganization: Afghanistan Reconstruction Steering 
Group; Responsibility: Coordinate and mobilize international 
reconstruction funds.; Members: More than 60 countries, the European 
Union, the members of the G-8,[A] the United Nations (UN), and the 
World Bank. Cochaired by the United States, the European Union, Japan, 
and Saudi Arabia.; Date of formation/comment: November 2001; 
Replaced by the Consultative Group (December 2002) and Afghanistan 
High-level Strategic Forum (March 2003).

Organization/suborganization: Implementation Group; Responsibility: 
Implement the strategy and policy of the Afghan Reconstruction Steering 
Group by facilitating coordination among the Afghan government, 
bilateral, multilateral, and nongovernmental organizations 
implementing projects in Afghanistan.; Members: The Afghan government, 
World Bank, UN Development Program, Asian Development Bank, Islamic 
Development Bank, and the Afghan Support Group[B]; Date of formation/
comment: January 2002; Transformed into Consultative Group (December 
2002).

Organization/suborganization: Implementation Standing Committee; 
Responsibility: Local working level coordination; Members: Afghan 
Assistance Coordinating Authority, UN Assistance Mission in 
Afghanistan, donor governments, international financial institutions, 
nongovernmental organizations; Date of formation/comment: April 2002; 
; Transformed into the Consultative Group Standing Committee (December 
2002).

Organization/suborganization: Program Groups/Program Secretariats; 
Responsibility: Further develop the 12 programs outlined in the Afghan 
government's National Development Framework. A lead ministry guides 
each program group. Technical support is provided by a program 
secretariat led by a UN, multilateral, or nongovernmental 
organization.; Members: Afghan government and UN, bilateral, 
multilateral, and nongovernmental organizations; Date of formation/
comment: April 2002; The Consultative Groups replaced the existing 
Program Groups, and the Program Secretariats were replaced by the 
Consultative Groups' Focal Points in December 2002.

Organization/suborganization: Afghan Assistance Coordination 
Authority (Afghan government agency); Responsibility: Coordinate the 
flow of international assistance in Afghanistan.; Members: Afghan 
government; Date of formation/comment: February 2002.

Organization/suborganization: UN Assistance Mission in Afghanistan; 
Responsibility: Coordinate all UN programs in Afghanistan.; Members: 
All UN agencies working in Afghanistan; Date of formation/comment: 
March 2002.

Organization/suborganization: Regional/Provincial Coordination 
Bodies; Responsibility: UN aid coordination organizations in major 
regions of Afghanistan/UN aid coordination organizations at the 
provincial level in Afghanistan; Members: All UN agencies working in 
Afghanistan; Date of formation/comment: Late 1990s/May 2002; In 
2002, the Afghan government asked that the bodies realign along 
provincial lines.

Sources: UN and Afghanistan Research and Evaluation Unit.

[A] The G-8 is comprised of Canada, France, Germany, Italy, Japan, 
Russia, the United Kingdom, and the United States.

[B] The Afghan Support Group was founded in 1997 by the 16 largest 
donor nations providing assistance to Afghanistan and the European 
Union. In January 2003, the group was dissolved and the Afghan 
government assumed responsibility for assistance coordination.

[End of table]

Figure 11: Organizations Responsible for Coordinating International 
Assistance in Afghanistan, 1998-2003:

[See PDF for image]

[End of figure]

In December 2002, the Afghan government instituted the Consultative 
Group coordination process in Afghanistan. The process evolved out of 
the previous Implementation/Program group processes. (Table 4 compares 
the two processes.) The Consultative Group process retains the same 
basic hierarchical structure that was established under the 
Implementation Group process.[Footnote 58] For example, the new process 
includes 12 groups, each lead by an Afghan government minister, 
organized around the 12 programs contained in the Afghan government's 
National Development Framework. In addition to the 12 groups, 2 
consultative groups covering national security programs (i.e., the 
national army and police); and 3 national working groups on 
disarmament, demobilization, and reintegration; counternarcotics; and 
demining were established. Further, 5 advisory groups were also 
established to ensure that cross-cutting issues, such as human rights, 
are mainstreamed effectively in the work of the 12 consultative groups 
and reflected in the policy framework and budget.

Each consultative group will assist in policy management, as well as 
monitoring the implementation of activities envisaged under the Afghan 
government's national budget. The groups will assist in preparing the 
budget, provide a forum for general policy dialogue, monitor the 
implementation of the budget, report on indicators of progress for each 
development program, and elaborate detailed national programs. The 
groups, with assistance from the standing committee, will also focus on 
monitoring performance against benchmarks established by each group. 
Each lead ministry will select a focal point, or secretariat, 
organization from among donors and UN agencies. Each year, in March, 
the Afghanistan Development Forum, or national consultative group 
meeting, will be held to discuss the budget for the next fiscal 
year, review national priorities, and assess progress. At that time, 
the consultative groups will report to the Consultative Group Standing 
Committee.

Table 4: Comparison of Implementation Group and Consultative Group 
Processes:

Structure:

Based on Afghan National Development Framework; Implementation Group: 
Yes; Consultative Group: Yes.

Hierarchy; Implementation Group: * Afghanistan Reconstruction Steering 
Group; * Implementation Group; * Implementation Group Standing 
Committee; * 12 Program groups; * Additional subgroups; * 1 Lead 
ministry per program group; * 12 Program group secretariats led by a 
donor agency; Consultative Group: * Afghanistan high-level Strategic 
Forum; * National Consultative Group/Afghanistan Development forum; * 
Consultative Group Standing committees; * 12 Program Consultative 
Groups; * 1 Lead ministry per program group; * 12 Program group 
secretariats led by a donor agency; * 2 National Security Consultative 
Groups; * 3 working groups; * 5 advisory groups.

Leadership; Implementation Group: Afghan ministry leads each group.; 
Consultative Group: Afghan ministry leads each group.

Membership; Implementation Group: Ministries, UN agencies, development 
banks, donor agencies/governments, and NGOs; Consultative Group: 
Ministries, UN agencies, development banks, donor agencies/
governments, and NGOs.

Stated goals:

Assist in budget preparation; Implementation Group: Yes; Consultative 
Group: Yes.

Monitor performance of programs and subprograms; Implementation Group: 
Yes; Consultative Group: Yes.

Promote better coordination between all parties; Implementation Group: 
Yes; Consultative Group: Yes.

Formulate policy; Implementation Group: Not stated; Consultative Group: 
Yes.

Develop projects/programs; Implementation Group: Yes; Consultative 
Group: Yes.

Prepare annual development plan; Implementation Group: Yes; 
Consultative Group: Not stated.

Set program benchmarks/targets; Implementation Group: Yes; 
Consultative Group: Yes.

Sources: GAO analysis of UN and Afghan government data.

[End of table]

[End of section]

Appendix VII: Major Donors' Pledges and Contributions as of December 31, 
2002 (as reported by the U.S. Department of State):

Dollars in millions.

Canada; Tokyo conference pledge[A]: 62.8; Additional pledges: [Empty]; 
Total disbursed: for 2002: 31.3; Time frame: 15 months.

France; Tokyo conference pledge[A]: 24; Additional pledges: [Empty]; 
Total disbursed: for 2002: 32; Time frame: Unspecified.

Germany; Tokyo conference pledge[A]: 285; Additional pledges: 43; Total 
disbursed: for 2002: 112; Time frame: 4 years.

Italy; Tokyo conference pledge[A]: 43; Additional pledges: [Empty]; 
Total disbursed: for 2002: 43.9; Time frame: 1 year.

Japan; Tokyo conference pledge[A]: 500; Additional pledges: [Empty]; 
Total disbursed: for 2002: 282; Time frame: 2.5 years.

United Kingdom; Tokyo conference pledge[A]: 288; Additional pledges: 
55; Total disbursed: for 2002: 77.5; Time frame: 5 years.

United States; Tokyo conference pledge[A]: 297; Additional pledges: 
[Empty]; Total disbursed: for 2002: 600; Time frame: 
Unspecified.

Russia[B]; Tokyo conference pledge[A]: [Empty]; Additional pledges: 
[Empty]; Total disbursed: for 2002: 30; Time frame: 
Unspecified.

Austria; Tokyo conference pledge[A]: 11.6; Additional pledges: 2.4; 
Total disbursed: for 2002: 10.7; Time frame: 1 year.

Belgium; Tokyo conference pledge[A]: 30.7; Additional pledges: [Empty]; 
Total disbursed: for 2002: 11.5; Time frame: Unspecified.

Denmark; Tokyo conference pledge[A]: 59; Additional pledges: 16.5; 
Total disbursed: for 2002: 31.9; Time frame: Unspecified.

Finland; Tokyo conference pledge[A]: 28; Additional pledges: 10; Total 
disbursed: for 2002: 12.1; Time frame: 4 years.

Greece; Tokyo conference pledge[A]: 4.5; Additional pledges: 1; Total 
disbursed: for 2002: 1.7; [Empty]; Time frame: [Empty].

Ireland; Tokyo conference pledge[A]: 12.3; Additional pledges: [Empty]; 
Total disbursed: for 2002: 9.8; [Empty]; Time frame: 4 years.

Luxembourg; Tokyo conference pledge[A]: 4.5; Additional pledges: .1; 
Total disbursed: for 2002: 3.6; [Empty]; Time frame: 2.5 years.

Netherlands; Tokyo conference pledge[A]: 63; Additional pledges: 5; 
Total disbursed: for 2002: 78.9; [Empty]; Time frame: 2.5 years.

Norway; Tokyo conference pledge[A]: 46.6; Additional pledges: 10; Total 
disbursed: for 2002: 47; [Empty]; Time frame: 2.5 years.

Portugal; Tokyo conference pledge[A]: [Empty]; Additional pledges: .8; 
Total disbursed: for 2002: [Empty]; [Empty]; Time frame: Unspecified.

Spain; Tokyo conference pledge[A]: 104; Additional pledges: 6.4; Total 
disbursed: for 2002: 77; [Empty]; Time frame: Unspecified.

Sweden; Tokyo conference pledge[A]: 90; Additional pledges: [Empty]; 
Total disbursed: for 2002: 31; [Empty]; Time frame: 4 years.

Switzerland; Tokyo conference pledge[A]: 20; Additional pledges: 
[Empty]; Total disbursed: for 2002: 6.7; [Empty]; Time frame: 
Unspecified.

European Commission; Tokyo conference pledge[A]: 864; Additional 
pledges: 78.4; Total disbursed: for 2002: 133; [Empty]; Time frame: 5 
years.

Bahrain; Tokyo conference pledge[A]: [Empty]; Additional pledges: 
[Empty]; Total disbursed: for 2002: [Empty]; [Empty]; Time frame: 
[Empty].

Kuwait; Tokyo conference pledge[A]: 30; Additional pledges: [Empty]; 
Total disbursed: for 2002: 5; [Empty]; Time frame: Unspecified.

Oman; Tokyo conference pledge[A]: [Empty]; Additional pledges: [Empty]; 
Total disbursed: for 2002: [Empty]; [Empty]; Time frame: [Empty].

Qatar; Tokyo conference pledge[A]: [Empty]; Additional pledges: 
[Empty]; Total disbursed: for 2002: .1; [Empty]; Time frame: 
Unspecified.

Saudi Arabia; Tokyo conference pledge[A]: 220; Additional pledges: 
[Empty]; Total disbursed: for 2002: 72.5; [Empty]; Time frame: 4 years.

United Arab Emirates; Tokyo conference pledge[A]: 36; Additional 
pledges: 80; Total disbursed: for 2002: 69.8; [Empty]; Time frame: 
Unspecified.

Iran; Tokyo conference pledge[A]: 560; Additional pledges: [Empty]; 
Total disbursed: for 2002: 32.7; [Empty]; Time frame: 6 years.

Australia; Tokyo conference pledge[A]: 8.8; Additional pledges: 14.6; 
Total disbursed: for 2002: 19; [Empty]; Time frame: 1 year.

South Korea; Tokyo conference pledge[A]: 45; Additional pledges: 
[Empty]; Total disbursed: for 2002: 5; [Empty]; Time frame: 2.5 years.

Republic of China (Taiwan); Tokyo conference pledge[A]: 29; Additional 
pledges: [Empty]; Total disbursed: for 2002: [Empty]; [Empty]; Time 
frame: 3 years.

Turkey; Tokyo conference pledge[A]: 5; Additional pledges: 1.8; Total 
disbursed: for 2002: 2.9; [Empty]; Time frame: 5 years.

China; Tokyo conference pledge[A]: 1; Additional pledges: 150; Total 
disbursed: for 2002: 30; [Empty]; Time frame: Unspecified.

India; Tokyo conference pledge[A]: 100; Additional pledges: [Empty]; 
Total disbursed: for 2002: 31.7; [Empty]; Time frame: One year.

Pakistan; Tokyo conference pledge[A]: 100; Additional pledges: [Empty]; 
Total disbursed: for 2002: 17.7; [Empty]; Time frame: Unspecified.

Total; Tokyo conference pledge[A]: 3,972.8; Additional pledges: 475; 
Total disbursed: for 2002: 1,949.95; [Empty]; Time frame: [Empty].

Source: Department of State.

[A] Pledges and disbursements do not include those of the World Bank, 
Asian Development Bank, and other international nongovernmental 
organizations.

[B] Russia did not pledge at Tokyo - Russian assistance has been 
primarily in-kind donations.

[End of table]

[End of section]

Appendix VIII: Comments from the World Food Program:

World Food Programme:

Programa Mundial de Alimentos:

Programme Alimentaire Mondial:

The Executive Director:

Via Cesare Giulio Viola, 68170 00148 Rome:

Italy:

Phone:	+39-06 6513.3030:

Fax:	+39-06 6513.2834:

Internet: www.wfp.org:

2 June 2003:

Mr. Loren Yager 
Director 
International Affairs and Trade Attachment 
GAO:

USA:

Dear Mr. Yager,

I would like to express my appreciation to the GAO for the opportunity 
to review and provide comments on its study, Lack of Strategic Focus 
and Obstacles to AWicultural Recovery Threaten Afghanistan's Stability. 
I appreciate and welcome the focused and comprehensive approach taken 
by the GAO and value the critical and constructive observations.

While recognizing the need of donor countries to comply with 
legislative mandates and processes, the US obligation to procure 
commodities produced in the US indeed slowed deliveries of food aid at 
a critical time. The recommendation to consider amending the 
Agriculture Trade Development and Assistance Act to allow the purchase 
of commodities outside the United States under certain circumstances 
would enable faster and greater flexibility in responding to emergency 
situations, such as the one in Afghanistan.

The report rightly notes that the assistance coordination was weak in 
2002. Coordination proved to be one of the most challenging aspects of 
operating in Afghanistan at the time. The transitional period, marked 
by the absence of formal government policies and strategies, 
complicated and impeded effective and efficient coordination. In the 
course of the year, however, and with increased guidance from the 
transitional government, great improvements have been noted.

Better coordination could have had a positive impact in giving 
strategic focus to the efforts to rehabilitate the agricultural 
infrastructure. However, overall assistance to Afghanistan may not have 
been sufficient and consistent to make that possible in 2002.

Enhanced and continued assistance for the recovery of Afghanistan will 
be essential to ensure political stability and food security.

I would like to express again our appreciation to the GAO for their 
efforts over the past eight months to better understand the impact, 
management and support of food and agricultural assistance to 
Afghanistan and factors influencing achieving food security and 
political stability.

The World Food Programme looks forward to working together with the 
United States Government and all our other partners in defining and 
implementing a sustainable strategy leading to food security and 
recovery of livelihoods.

Sincerely,

James T. Morris:

Signed by James T. Morris:

The following are GAO's comments on the letter from the United Nations 
World Food Program dated June 2, 2003.

GAO Comments:

1. Although changes in the coordination mechanism utilized in 
Afghanistan were introduced in 2003, the Afghan government and the 
international community still lack a common, jointly developed strategy 
for rehabilitating the agricultural sector. We believe that such a 
strategy, including measurable goals and a means to evaluate progress 
toward achieving the goals, is needed to focus limited resources and 
hold the international community accountable for the assistance it 
delivers.

[End of section]

Appendix IX: Comments from the Department of State:

United States Department of State 
Washington, D.C. 20520:

JUN 3 2003:

Dear Ms. Westin:

We appreciate the opportunity to review your draft report, "FOREIGN 
ASSISTANCE: Lack of Strategic Focus and Obstacles to Agricultural 
Recovery Threaten Afghanistan's Stability," GAO-03-607, GAO Job Code 
320108.

The enclosed Department of State comments are provided for 
incorporation with this letter as an appendix to the final report.

If you have any questions concerning this response, please contact 
Patricia Haslach, Bureau of South Asian Affairs, Office of Afghanistan 
Reconstruction at (202) 647-5493.

Sincerely,


Christopher B. Burnham (Assistant Secretary for Resource Management and 
Chief Financial Officer:

Signed by Christopher B. Burnham:

Enclosure:

As stated.

cc:

GAO/IAT - Loren Yager State/OIG - Luther Atkins State/SA - Christina 
Rocca State/H - Paul Kelly:

Ms. Susan S. Westin, Managing Director, International Affairs and 
Trade, U.S. General Accounting Office.

Department of State Comments for GAO Draft Report:

Lack of Strategic Focus and Obstacles to Agricultural Recovery Threaten 
Afghanistan's Stability (GAO-03-607):

The Department has reviewed the draft report regarding the impact and 
management of food and agricultural assistance to Afghanistan, as well 
as its evaluation of obstacles to achieving food security and political 
stability.

The Department supports in principle the idea of a joint international-
Afghan government effort, within the Consultative Group framework, to 
develop an overall operational agricultural sector rehabilitation 
strategy that addresses and emphasizes the agricultural and food 
assistance priorities of the Afghan Government. Such an approach, with 
quantifiable goals, clearly delineated roles and responsibilities, and 
inherent mechanisms for monitoring and evaluation will increase 
transparency and provide benchmarks against which the success or 
failure of subsequent efforts can be measured. This approach is also 
consistent with the Department's objective to encourage sustainable, 
Afghan-led efforts as a means to an end.

Regarding the draft report's second recommendation that Congress 
consider amending the Agriculture Trade Development and Assistance Act 
of 1954, the Department believes that further study is needed. The 
draft offers significant evidence that the purchase and shipment of 
commodities from the US is not necessarily the most cost-effective 
method of providing food assistance to Afghanistan. However, the 
recommended alternative approach --the purchase of commodities locally 
(either directly or by contributing in-kind cash to WFP) --is not well 
supported by statistical evidence and also overlooks potential 
variables that may in fact negate the perceived cost-benefit savings. 
Regional customs fees, taxes, trucking costs and conditions, 
corruption, and security vulnerabilities are all elements that require 
assessment prior to asking Congress to consider making a legislative 
amendment.

The following are GAO's comments on the letter from the Department of 
State dated June 3, 2003.

GAO Comments:

1. The U.S. Agency for International Development (USAID) currently 
purchases limited amounts of regional food commodities in an effort to 
respond quickly to humanitarian emergencies. Commodities purchased in 
the United States by U.S. agencies must travel the same logistics 
networks as commodities purchased regionally. For example, U.S. 
commodities destined for Afghanistan in 2002 were shipped from the 
United States to the Pakistani port at Karachi and moved to their final 
destination via roads in Pakistan and Afghanistan. Commodities 
purchased in Pakistan followed the same transit routes. Hence, the 
overland shipping costs, such as for trucking, were the same for U.S. 
origin commodities and Pakistani commodities. Further, regional cash 
purchases of food would be made by U.S. government officials or World 
Food Program (WFP) officials, the same officials that currently handle 
hundreds of millions of dollars in assistance funds and millions of 
metric tons of commodities; we are not suggesting that cash be provided 
to local governments. Any purchases would be subject to U.S. and UN 
accountability procedures, as such purchases are currently; increasing 
the amount of commodities purchased locally would not by itself create 
an opportunity for corruption.

[End of section]

Appendix X: Comments from the United States Agency for International 
Development:

U.S. AGENCY FOR INTERNATIONAL DEVELOPMENT:

JUN 6 2003:

Mr. Loren Yager:

Director, International Affairs and Trade U.S. General Accounting 
Office:

441 G Street, N.W. Washington, D.C. 20548:

Dear Mr. Yager:

I am pleased to provide the U.S. Agency for International Development's 
(USAID's) formal response on the draft GAO report entitled, "FOREIGN 
ASSISTANCE: Lack of Strategic Focus and Obstacles to Agricultural 
Recovery Threaten Afghanistan's Stability" (June 2003).

USAID agrees generally with the merits of developing a comprehensive 
international-Afghan operational strategy for the rehabilitation of the 
agricultural sector, as 
recommended by the GAO. Within the context of the established 
Consultative Group mechanism, the leadership for such a strategy should 
be provided by the FAO and the Ministry of Agriculture and Livestock. 
USAID will welcome an opportunity to collaborate to the fullest.

It is important, however, to recognize the context in which USAID and 
other donors have been working to rehabilitate and promote the 
agricultural sector's development since the Taliban were removed from 
power in late 2001. Following over two decades of turmoil and natural 
disasters, including a severe drought from 1999 - 2001, agricultural 
resources had been decimated and the national government severely 
weakened. In such circumstances, mounting a broad-based strategy with 
substantive involvement by the national government was unrealistic. 
Nevertheless, USAID succeeded in developing a substantial agricultural 
program, in consultation with other key donors operating in the sector, 
and with the strong, formal endorsement of the Ministry of Agriculture 
and Livestock, in a concerted effort to jump-start the sector's 
recovery. This $150 million program, spanning a three year period, 
encompasses essential elements of a broader sector strategy, including 
the injection of cash resources for productive activities through 
financial intermediaries and the reconstruction of rural 
infrastructure, all within the context of promoting agricultural input 
and output markets. It should also be noted that USAID has provided 
substantial resources in the form of food aid, grants and technical 
assistance which have contributed, along with improved levels of 
precipitation, to the significantly higher crop production yields 
registered in 2002 and projected for 2003.

While acknowledging that a comprehensive agricultural strategy, 
acceptable to all key stakeholders, would assist in rehabilitating and 
developing the country's principal economic sector, USAID believes that 
other factors are far more significant in threatening Afghanistan's 
security and political stability, in particular: (1) the concerted 
attacks in many regions of the country by Taliban forces on both Afghan 
nationals and international staff engaged in humanitarian and 
development assistance, and (2) the continuing presence of warlords 
exercising fiscal and military control throughout most of Afghanistan 
outside of Kabul. Although these factors are noted throughout your 
report, the title of the report suggests agricultural sector 
difficulties are the causal link to Afghanistan's instability. We 
would, therefore, request the GAO to revise the report's title.

With reference to the GAO's recommendation that the Agricultural Trade 
Development and Assistance Act of 1954 (P.L. 83-480) be amended to 
enable the provision of cash and the purchase of commodities outside 
the United States, as necessary, to meet emergencies, USAID believes 
that other authorities adequately address this concern. Under the broad 
disaster assistance authorities in the Foreign Assistance Act (FAA), 
USAID already has the authority to undertake the kind of interventions 
envisioned by the GAO. The State Department's Bureau of Population, 
Refugees, and Migration has comparable authorities and also has a 
history of making flexible cash grants to WFP for food purchases. Just 
recently, USAID drew upon such authority to provide the UN's World Food 
Program with cash resources to procure food locally in helping to 
address Iraq's substantial food aid requirements. In the case of 
Afghanistan, USAID used 
such authority to provide cash grants for local food procurement. 
Moreover, in the FY 2004 Budget Justification to the Congress, USAID 
has proposed the establishment of a Famine Fund, with an initial 
allocation of $200,000,000. Again, drawing upon the broad disaster 
assistance authorities within the FAA, this Fund would provide 
additional flexibility in combating famine and allowing USAID to 
leverage other donor resources in averting or reducing the incidence of 
famine. USAID envisions drawing resources from this account for cash 
interventions (e.g., cash grants, cash for work, and cash for seed), 
regional food purchases, market preservation activities, and livelihood 
preservation activities to maintain community cohesion and household 
assets (e.g., livestock).

Enclosed at Annex A are additional technical comments for your 
consideration.

Thank you for the opportunity to respond to the GAO draft report and 
for the courtesies extended by your staff in the conduct of this 
review.

Sincerely,

John Marshall:

Assistant Administrator Bureau for Management:

Signed by John Marshall:

Enclosure: a/s:



The following are GAO's comments on the letter from the United States 
Agency for International Development dated June 6, 2003.

GAO Comments:

1. We believe that the U.S. Agency for International Development 
(USAID) should take an active and aggressive role in the cooperative 
development of a joint international-Afghan government strategy because 
the United States is the largest donor to Afghanistan, agricultural 
rehabilitation is the cornerstone of USAID's efforts in Afghanistan, 
and the success of U.S. policy goals in Afghanistan is tightly linked 
to the rehabilitation of the agricultural sector. According to USAID's 
assistance strategy for Afghanistan, restoring food security is USAID's 
highest priority. Consequently, agriculture assistance is one of 
USAID's main strategic objectives in Afghanistan. Further, according to 
USAID's Afghan assistance strategy documents, USAID's overall 
assistance program is based on several critical assumptions about 
conditions in Afghanistan, one condition being that agricultural 
conditions do not deteriorate further. The document states that if 
these conditions do not prevail, USAID may not achieve its goals. We 
also recognize the importance of the Food and Agriculture 
Organization's (FAO's) involvement in the cooperative strategy 
development effort. However, donor support for FAO's Afghanistan 
program has been limited.

2. We agree that developing a broad-based agricultural rehabilitation 
strategy would have been difficult in early 2002, given the nascent 
nature of the Afghan government and the assistance coordination 
mechanism then in use. However, the government has been in place since 
June 2002, and the Consultative Group coordination mechanism was 
introduced in December 2002. Hence, we believe that the conditions now 
exist for the development of such a strategy. In addition, we have 
discussed the development of a joint Afghan-international community 
agriculture rehabilitation strategy with the Afghan Minister of 
Agriculture and FAO. Both support the idea and welcome the opportunity 
to develop such a strategy.

3. No change to the title of the report is necessary. As stated in the 
report, agriculture is of central importance to Afghanistan's economy 
and the livelihood of 85 percent of its citizens. Further, the link 
between food security and political stability is recognized by the 
international community not only in Afghanistan but also in other areas 
such as southern Africa. In addition, as stated above, USAID's 
assistance strategy recognizes the importance of agriculture sector 
rehabilitation to the achievement of the U.S. policy goals in 
Afghanistan, including a politically stable state that is not a harbor 
for terrorists.

4. We agree that other authorities allow USAID to provide cash or 
purchase assistance commodities outside the United States. However, we 
believe that amending the Agricultural Trade Development and Assistance 
Act of 1954 to allow the provision of cash or food commodities outside 
the United States will greatly improve U.S. flexibility in responding 
to crises affecting U.S. national security and foreign policy 
interests. The act is the principal authority for providing food 
assistance in emergency and nonemergency situations. Amending the act 
will provide a permanent provision in this authority allowing the 
United States to respond rapidly and in a cost-effective manner to 
events that affect U.S. national security. USAID cites the recently 
proposed $200 million Famine Fund as providing the flexibility that the 
United States needs to address humanitarian crises. However, the fund 
proposal indicates that the fund will target dire unforeseen 
circumstances related to famine; thus, the fund does not appear to be 
designed to respond to nonfamine crises involving large amounts of food 
aid or national security. The fund amounts to less than 10 percent of 
the $2.2 billion and $2.6 billion appropriated for U.S. food aid in 
2002 and 2003, respectively, a period marked by an increasing number of 
humanitarian food crises--for example, in Afghanistan, southern Africa, 
and North Korea--that did not entail famine but that did, in some 
cases, affect U.S. national security. The Famine Fund is inadequate to 
respond to the increasing number and size of such crises. Meanwhile, 
the availability of commodities in the United States for food 
assistance has declined in 2003. Therefore, the need to procure 
commodities overseas in close proximity to affected countries has 
become more critical while also being more cost effective.

[End of section]

Appendix XI: Comments from the Department of Agriculture:

USDA:

United States Department of Agriculture:

Mr. Loren Yager.

Director, International Affairs and Trade.

U.S. General Accounting Office.

441 G Street, N.W

Washington, D.C. 20548.

JUN 1 0 2003: 

Dear Mr. Yager:

The U.S. Department of Agriculture (USDA) would like to 
thank the General Accounting Office for the opportunity to comment on 
draft report #GAO-03-607 entitled "FOREIGN ASSISTANCE: Lack of 
Strategic Focus and Obstacles to Agricultural Recovery. USDA is 
pleased to provide its comments.

USDA does not support GAO's recommendation to amend the 
Agricultural Trade Development and Assistance Act of 1954 (P.L. 83-
480) to permit the purchase of non-U.S. commodities in emergencies. 
USDA believes that additional flexibility to quickly respond to 
humanitarian crises can be achieved through other means that will not 
adversely impact upon the provision of U.S. commodities under P.L. 83-
480. 

GAO should emphasize that the high cost of ocean freight for food aid 
is due to the cargo preference requirements for food aid shipments.
[NOTE 1] USDA estimates that nearly half of the cost of ocean freight 
and commissions can be attributed to the cargo preference 
requirements. USDA determined that in aggregate, for both bulk and 
packaged commodities to all countries, the cost of U.S. cargo 
preference requirements adds approximately 9 percent to the total 
program cost (commodity and freight). GAO estimated that total freight 
and commissions represented 19.6 percent of the total cost of 
providing U.S. commodities to Afghanistan. GAO has, in prior reports, 
emphasized that U.S. cargo preference adds significantly to the cost 
of the food aid programs.[NOTE 2] A more appropriate recommendation 
would be to review the application of U.S. cargo preference 
requirements so that costs of compliance may be funded separately from 
food aid budgets or that cargo preference requirements can be waived 
in specific emergency food aid situations, a recommendation that GAO 
has made previously.[NOTE 3]:

GAO's conclusions that food aid commodities were readily available 
regionally at lower costs and on a timely basis are not supported by 
specific information. GAO estimated that an additional 103,000 metric 
tons of commodities could have been purchased within the region if the 
cost of ocean freight from the United States to Afghanistan had been 
eliminated. GAO does not indicate what commodities were available 
regionally in sufficient quantity to be delivered to Afghanistan at 
reasonable costs. GAO assumes additional commodities were available 
because the World Food Program (WFP) purchased a considerable supply of 
wheat in Pakistan and Kazakhstan for Afghanistan (157,628 metric tons 
in 2002). However, GAO provides little information on the delivered 
costs and the elapsed time for delivery of this wheat.

As would be expected following the war, and given the difficult terrain 
and harsh weather conditions in Afghanistan, WFP incurred considerable 
logistical problems with the transportation of regionally supplied 
wheat. For example, commercial trucking was not available at times, 
truckers dramatically increased freight costs, WFP had to purchase 
trucks to locally distribute food, and roads were closed by snow and 
run-off. WFP even undertook road maintenance work to keep 
transportation routes open. We do not believe that placing an 
additional burden on the limited logistical resources in the region to 
achieve marginal savings in time and costs is a viable option.

GAO provides neither an evaluation of the transportation routes and 
infrastructure to deliver regionally supplied commodities nor any 
estimates of the time required for regionally supplied commodities to 
arrive at destination. Further, it is doubtful that consumer-ready 
commodities such as flour, corn/soy blend, high-energy biscuits or 
other processed commodities could be obtained in sufficient supplies on 
a regional basis. USDA is concerned that control over quality and 
nutritional value could be lost when commodities are purchased 
regionally. Additionally, GAO does not indicate how such regional 
purchases would demonstrate to the recipient that the food aid is a 
gift from the American people.

In Afghanistan, WFP and the U.S. Agency for International Development 
(USAID) accepted the need to acquire some commodities regionally in the 
first two to three months of the crisis. After that, it was or has been 
simply a matter of providing the appropriate commodities and assuring 
delivery with the fewest logistical problems. With good planning, the 
efficient U.S. grain infrastructure system should be able to respond to 
ongoing demands for food aid.

The U.S. Government assisted WFP in making regional purchases of 
commodities for Afghanistan under USAID and Department of State 
authorities. As acknowledged by GAO, the proposed $200 million Famine 
Fund would permit an additional means to purchase food aid commodities 
in foreign countries. Given the existing and proposed authorities to 
fund regional purchases with cash, USDA questions why it would be 
necessary to amend the P.L. 83-480 statute to also permit this option.

Regarding the reconstruction of Afghan agriculture, GAO recommends that 
USAID try to ensure that meaningful coordination and oversight of aid 
to Afghan agriculture be established by the Afghan government. This 
recommendation is consistent with a major conclusion of the May 29, 
2002, Economic Research Service, USDA, workshop titled, "Agricultural 
Reconstruction in Afghanistan-Issues, Challenges, Strategies," which 
saw the danger of many uncoordinated aid efforts failing to achieve 
comprehensive rehabilitation of Afghan production and marketing. 
However, it should also be noted that USAID and other donors faced 
numerous challenges that significantly complicated their efforts to 
fully engage the Afghan government as a partner in their developmental 
activities.

We believe that the comment in the second sentence in the cover letter 
to Senator Richard Durbin and Representative Frank Wolf that "the food 
and agricultural sector has been almost totally destroyed" is an 
overstatement. Significant agricultural capacity remains in 
Afghanistan, even after, as the report later states, crop and livestock 
production was cut by 40-60 percent in the period of drought and 
warfare.

Finally, specific technical comments on the draft report are contained 
in Attachment A for your review and consideration.

In closing, I again want to thank you for allowing us to comment on 
this draft report. Please let us know if you would like to discuss our 
comments further.

Sincerely,

A. Ellen Terpstra 
Administrator:



Signed by A. Ellen Terpstra: 

Attachment:

NOTES: 

[1] The Merchant Marine Act, 1936 (P.L. 74-835), as amended by 
the Cargo Preference Act of 1954 (P.L. 83-664), generally requires 
that at least 50 percent of any U.S. government-controlled cargo 
shipped by sea be carried on privately owned U.S.-flag vessels. In 
1985, the Merchant Marine Act, 1936 was amended to require that 75 
percent of certain foreign food aid be shipped on privately owned 
U.S.-flag vessels.

[2] GAO-02-801 T, Food Aid: Experience of U.S. Programs Suggests 
Opportunities for Improvement, June 4, 2002; GAO/RCED-95-34, Cargo 
Preference Laws, November 30, 1994; and GAO/GGD-94-215, Cargo 
Preference Requirements: Objectives Not Significantly Advanced When 
Used in U.S. Food Aid Programs, September 29, 1994.

[3] GAO/NSIAD-93-168, Food Aid: Management Improvements Are Needed to 
Achieve Program Objectives, July 23, 1993 and GAO/NSIAD-95-74, Foreign 
Aid: Actions Taken to Improve Food Aid Management, March 23, 1995.


The following are GAO's comments on the letter from the Department of 
Agriculture dated June 10, 2003.

GAO Comments:

1. Although other legislation allows for the provision of cash or 
assistance commodities from non-U.S. sources, we believe that amending 
the Agricultural Trade Development and Assistance Act of 1954 to allow 
the provision of cash or food commodities outside the United States 
will greatly improve U.S. flexibility in responding to crises that 
affect U.S. national security interests. The act is the principal 
authority for providing food assistance in emergency and nonemergency 
situations. Amending the act will provide a permanent provision in this 
authority allowing the United States to respond rapidly and in a cost 
effective manner to events that affect U.S. national security.

In addition, although the proposed $200 million Famine Fund may provide 
some additional flexibility for responding to humanitarian crises, the 
fund proposal indicates that the fund will target dire unforeseen 
circumstances related to famine. Thus, the fund does not appear to be 
designed to respond to nonfamine crises involving large amounts of food 
aid or national security. The fund amounts to less than 10 percent of 
the $2.2 billion and $2.6 billion appropriated for U.S. food aid in 
2002 and 2003, respectively, a period marked by an increasing number of 
humanitarian food crises--for example, in Afghanistan, southern Africa, 
and North Korea--that did not entail famine but that did, in some 
cases, affect U.S. national security.

2. We agree with the U.S. Department of Agriculture (USDA) that the 
cargo preference requirement adds additional cost to food assistance 
and should be waived in specific situations, and we have adjusted the 
matter for congressional consideration to reflect this. As stated in 
the report, 19.6 percent of total food assistance costs in fiscal year 
2002 were for ocean freight. These costs were incurred because of the 
requirement that assistance commodities must be purchased in the United 
States, and 75 percent of the purchased commodities by weight must be 
shipped on U.S.-flagged carriers. In previous reports, we analyzed the 
costs of cargo preference requirements on food assistance and 
demonstrated the negative impact of these costs on U.S. food aid 
programs.

3. Additional information has been added to the report describing the 
commodity surpluses available in the region in 2002. For example, in 
2002, Kazakhstan harvested 16 million metric tons of wheat, a record 
harvest for that nation. Approximately 6 million metric tons of the 
2002 harvest was available for export. Similarly, Pakistan exported 
approximately 1.6 million metric tons of wheat in 2002. Consequently, 
these countries had nearly 7.6 million metric tons available for 
export, 20 times the requirement for World Food Program's (WFP's) 2002 
emergency operation or 68 times the amount that WFP purchased from 
these two countries in 2002.

4. All of the obstacles cited by USDA, including road closures due to 
snow, were concerns for WFP in 2002. We describe many of these 
obstacles in the report and also demonstrate that WFP was able to 
overcome the obstacles. The same transportation routes were used to 
move both regionally procured commodities and U.S. origin commodities. 
As noted in the report, in December 2002, while fighting between 
coalition forces, the Northern Alliance, and the Taliban was still 
occurring and winter weather was complicating food deliveries, WFP 
delivered 116,000 metric tons of food to Afghan beneficiaries, in the 
single largest movement of food by WFP anywhere in a 1-month period. 
Further, according to WFP, its Afghanistan logistics system was capable 
of routinely moving over 50,000 metric tons of food per month. 
Consequently, adding 103,000 metric tons or 8,600 metric tons per month 
to the total food moved over the course of 2002 would not have 
overburdened WFP's logistics system. Further, the cost and time saved 
by purchasing commodities regionally are not marginal. As indicated in 
the report, purchasing commodities regionally could have substantially 
reduced the delivery time and the increased level of purchased 
commodities could have fed 685,000 people for 1 year.

5. Although all commodities may not be available regionally in all 
cases, in 2002, Afghanistan's greatest need was wheat, which 
constituted the bulk of the commodities delivered to Afghanistan that 
year. As stated in the report, if the United States had purchased wheat 
regionally, or provided WFP with cash to make regional purchases, the 
United States could have saved approximately $35 million in 2002. While 
our analysis describes how much wheat could have been purchased 
regionally with the savings, higher-value, consumer-ready commodities 
such as corn-soy blend from U.S. companies could have been purchased 
instead of additional regionally produced wheat. In either case, the 
United States could have provided a greater volume of commodities to 
Afghanistan if it had used the savings realized through the purchase of 
regional commodities versus U.S. commodities to procure additional 
commodities. Further, WFP has commodity quality control standards and 
would not purchase commodities with donor funds that were objectionable 
to the donor providing the funds. Finally, much of the wheat that was 
purchased in the United States was shipped in bulk to ports in Pakistan 
where it was bagged for final distribution in bags clearly marked 
"USA." Wheat purchased regionally with U.S. funds was packaged in 
Pakistan in the same type of bags. Thus, any regional purchases could 
be packaged in appropriately marked bags in the country of origin or at 
a bagging facility in a transit country. WFP uses this practice in 
other regions, such as southern Africa.

6. WFP made regional purchases during late 2001, but it also made 
regional purchases during 2002. As stated in the report, the amount of 
food available for food assistance in 2003 is less than in 2002, while 
the need for food aid continues to grow around the world, most notably 
in southern Africa. In addition, even if the U.S. grain infrastructure 
system is able to respond to ongoing demands for food aid, purchasing 
U.S. origin commodities and shipping the commodities via expensive 
ocean freight is not the most cost effective or quickest means either 
of supplying food to hungry people or of achieving U.S. national 
security and foreign policy objectives, such as stability in 
Afghanistan.

7. We agree that the donor community faced challenges in engaging the 
Afghan government in 2002. We believe that the mechanisms currently in 
place, including the Consultative Group coordination mechanism, provide 
an environment where the international community and the Afghan 
government can engage in a joint strategy development effort.

8. The report's description of Afghanistan's agriculture sector is 
based on discussions with and documents obtained from FAO, Asian 
Development Bank, USAID, and Afghan government officials. We have 
adjusted the language in the report in response to USDA's comments.

[End of section]

Appendix XII: Comments from the Department of Defense:

SPECIAL OPERATIONS/ LOW-INTENSITY CONFLICT:

OFFICE OF THE ASSISTANT SECRETARY OF DEFENSE:

WASHINGTON, D.C. 20301-2500:

JUN 4 2003:

Loren Yager:

Director, International Affairs and Trade 
U.S. General Accounting Office 
Washington, DC 20548:

Dear Mr. Yager,

This is the Department of Defense (DoD) response to the GAO draft 
report GAO-03-607, "FOREIGN ASSISTANCE: Lack of Strategic Focus and 
Obstacles to Agricultural Recovery Threaten Afghanistan's Stability," 
dated May 19, 2003 (GAO Code 320108). As our office's involvement in 
the issues presented in this draft study is restricted to humanitarian 
daily rations (HDRs), we have limited our comments to pages 20-22, 
"Humanitarian Daily Rations Were Expensive and Inefficient.":

The report incorrectly categorizes HDRs purely as a food assistance 
program (p. 20). Under extreme battlefield conditions, HDRs were 
effective in alleviating suffering and conveying that the U.S. was 
waging war against the Taliban and not the Afghan people. HDRs were a 
niche capability, not a major food program. To evaluate HDRs alongside 
efforts by USAID and the World Food Program loses sight of their 
purpose.

DoD has conducted informal evaluations with positive results concerning 
the humanitarian, public relations, and military impact of the HDRs (p. 
22). Returning Special Forces soldiers who coordinated many of the 
drops reported that the HDRs alleviated hunger in vulnerable 
populations, generated tremendous good will among local Afghans, and 
helped US military personnel build critical relationships with Afghan 
communities. Thanks to these good will and public relations benefits, 
HDRs continue to be a sought-after item in response to recent disasters 
and military operations.

Regarding the cost efficiency of HDRs (p. 22), HDRs and bulk food 
assistance are used to respond to different needs, so their cost cannot 
be compared directly. Using funds spent on HDRs, one could have 
purchased more bulk food, but could not have delivered it, since the 
areas where HDRs were dropped were inaccessible to bulk food delivery 
during this period.

Sincerely,

Joseph J. Collins,

Deputy Assistant Secretary, Stability Operations:

Signed by Joseph J. Collins:

The following are GAO's comments on the letter from the Department of 
Defense dated June 10, 2003.

GAO Comments:

1. The report discusses both food assistance and nonfood assistance 
aspects of the Humanitarian Daily Ration program. On page 30 of the 
report, we state that the HDR program was initiated to alleviate 
suffering and convey that the United States waged war against the 
Taliban, not the Afghan people. Also, the HDR program is included with 
the U.S. Agency for International Development's humanitarian programs 
in U.S. government tallies of total humanitarian assistance provided to 
Afghanistan.

2. Department of Defense officials responsible for the administration 
of the HDR program stated that no formal evaluation of the HDR program 
in Afghanistan has been conducted. In the report, we cite the informal 
reporting that provided the Department of Defense with some information 
about how the program was received by the Afghan people. We have added 
information about the goodwill that the HDRs generated according to the 
informal reports cited by the Department of Defense in its comments on 
the draft report.

3. The report describes how HDRs are designed to be used--to relieve 
temporary food shortages resulting from manmade or natural disasters--
not, as in Afghanistan, to feed a large number of people affected by a 
long-term food shortage. Further, as discussed in the report, the World 
Food Program (WFP) has worked in Afghanistan for many years, and during 
that period it developed an extensive logistics system for delivering 
food throughout the country. Even during the rule of the Taliban, WFP 
was able to deliver food to remote areas including those controlled by 
the Northern Alliance. During the month of December 2001, while 
Department of Defense was delivering HDRs, WFP delivered 116,000 metric 
tons of food to Afghanistan, a level of food assistance that exceeds 
any 1-month total for any emergency operation in WFP's history. As 
stated in the report, WFP's logistics system was capable of delivering 
commodities to remote populations both by air or by donkey if 
necessary.

[End of section]

Appendix XIII: GAO Contacts and Staff Acknowledgments:

GAO Contacts:

Phil Thomas (202) 512-9892 David M. Bruno (202) 512-7280:

Staff Acknowledgments:

In addition to the individuals named above, Jeffery T. Goebel, Paul 
Hodges, and Reid L. Lowe made key contributions to this report.

(320108):

FOOTNOTES

[1] Estimates on total population vary between 24 and 28 million.

[2] FAO defines food security as ensuring that sufficient food is 
available, that supplies are relatively stable, and that those in need 
of food can obtain it. The World Bank defines food security as the 
condition whereby everyone, at all times, has access to and control 
over high-quality food sufficient for an active and healthy life.

[3] In this report, "international community" is defined as the 
collective grouping of bilateral, multilateral, and international 
assistance agencies and nongovernmental organizations.

[4] According to the 2002 UN World Development Indicators, as of 2000 
(the latest year for which figures are available), the infant mortality 
rate in Afghanistan was 165 per 1,000 live births, and the mortality 
rate for children younger than 5 years was 257 per 1,000 live births. 
Approximately 10 percent of children younger than 5 suffer from acute 
malnutrition, and 50 percent suffer from chronic malnutrition. This 
condition renders children particularly vulnerable to disease, 
especially pneumonia, tuberculosis, and diarrheal diseases. In 
addition, malnutrition is believed to affect about 10 percent of Afghan 
women of childbearing age.

[5] The Bonn Agreement, signed by numerous stakeholders on December 5, 
2001, in Bonn, Germany, established provisional arrangements concerning 
the governing of Afghanistan pending the reestablishment of permanent 
government institutions within the country. The UN Security Council 
endorsed the Bonn Agreement on December 6, 2001, through UN Resolution 
1383.

[6] One hectare is equivalent to 10,000 square meters, 2.471 acres, or 
11,959.64 square yards.

[7] Historical percentage based on UN data from the 1970s and early 
1990s.

[8] These ministries are referred to as the Ministries of Agriculture 
and Irrigation throughout the remainder of this report.

[9] WFP was established in 1963. Since its inception, it has provided 
food for development projects, and it has also provided increasingly 
greater shares of assistance to emergency operations around the world. 
WFP devoted 28 percent of its resources to development in 1997, 18 
percent in 1999, 13 percent in 2000, and 10 percent in 2001. The 
program obtains all of its resources through voluntary contributions 
from donor nations.

[10] In Afghanistan, WFP partners with UN organizations like the UN 
High Commissioner for Refugees and local and international 
nongovernmental organizations, including CARE, Oxfam, and World Vision.

[11] Agricultural assistance includes distribution of inputs (seed, 
planting materials, fertilizer, tools, livestock); irrigation repair; 
water resource management; hydrologic and climate monitoring/watershed 
management; agriculture product market, supply, and distribution 
systems development; rehabilitation and development of agriculture 
infrastructure, including fertilizer plants, seed farms, nurseries, 
product production and processing facilities, and government facilities 
(offices, labs); veterinary services/artificial insemination 
(supplies, training); pest control and capacity building/training in 
related subjects (horticulture, irrigation, animal husbandry); and 
development of agriculture policies, regulations, and laws.

[12] During the period 1999-2001, WFP and other agencies believed that 
without food assistance to Afghanistan, a famine could occur. In remote 
areas, prefamine conditions, including severe malnutrition, were 
observed.

[13] WFP has provided assistance to Afghanistan for most of the 36 
years prior to 2002; consequently, it had significant experience in the 
country, and its logistics infrastructure was well established. The 
assistance delivered from 1999 through 2001 was not tightly coordinated 
with the Taliban owing to the UN's policy of not working with this 
particular government. The assistance delivered in 2002 was coordinated 
with the new Afghan government through memorandums of understanding.

[14] For example, food-for-work participants earn 7 kilograms of wheat 
per day, valued at $1.00. Wage rates across Afghanistan range from 
$1.50 to $3.40 per day. 

[15] WFP requires donors to provide funding to cover transportation and 
administrative costs for in-kind contributions of commodities. The cash 
that the U.S. contributes for this purpose cannot be used by WFP to 
purchase commodities.

[16] The special envoy's term ran from November 2001 to May 2002. A 
second envoy was not appointed.

[17] Owing to security restrictions, we were able to conduct only 
limited site visits in Afghanistan.

[18] According to WFP, approximately 44.6 million people needed food 
assistance in Africa and North Korea in 2002. Meanwhile, declining 
global food production and donor food assistance contributions are 
expected to reduce aid levels worldwide in 2003. As of May 2003, based 
on donor pledges received, WFP estimates that donor contributions to 
Afghanistan will be adequate to meet projected requirements. 

[19] Emergency Operation 10155.0 "Emergency Assistance to Afghanistan." 
The period of the operation was originally 9 months but was extended to 
15 months to ensure a continued pipeline of food and a smooth 
transition between this operation and the subsequent operation.

[20] Section 416(b) of the Agricultural Act of 1949 provides a 
permanent authority for USDA to donate surplus commodities in Commodity 
Credit Corporation inventories to carry out programs of assistance in 
developing and other foreign countries. The administration has decided 
to sharply reduce reliance on this program. The administration expects 
to use only $50 million in 416(b) commodities worldwide in 2003, 
compared with $360 million in 2002 and $634 million in 2001. It has 
increased P.L. 480 Title II funding by approximately $800 million in 
fiscal year 2003 in part to offset the decrease.

[21] WFP's Regional Bureau for the Mediterranean, Middle East, and 
Central Asia is located in Cairo, Egypt, and is responsible for 
operations in Afghanistan.

[22] In March 2002 testimony before the Senate Foreign Relations 
Committee, the Administrator of USAID stated, "The countries 
surrounding Afghanistan had plenty of surplus food available, thus 
ensuring price stability, to meet the needs of the Afghan people. 
However, the tools did not exist for the U.S. government to respond 
more effectively and, possibly, at lower cost to the taxpayer." In 
2002, Kazakhstan exported 6 million metric tons of wheat and Pakistan 
exported 1.6 metric tons. 

[23] In 2002, WFP purchased approximately 33 percent of all commodities 
it distributed in Afghanistan and received the other 67 percent from 
donor nations.

[24] Estimate based on the ration provided to refugees in Afghanistan: 
12.5 kilograms (27.5 pounds) of wheat per person per month and regional 
commodity and transportation costs of $340 per metric ton.

[25] The Merchant Marine Act, 1936 (P.L. 74-835), as amended by the 
Cargo Preference Act of 1954 (P.L. 83-664), generally requires that at 
least 50 percent of any U.S. government-controlled cargo shipped by sea 
be carried on privately owned U.S.-flag vessels. In 1985, the Merchant 
Marine Act, 1936 was amended to require that 75 percent of certain 
foreign food aid be shipped on privately owned U.S. flag vessels.

[26] For further information on impact of shipping U.S. commodities on 
U.S. flagged cargo vessels see Cargo Preference Requirements: 
Objectives Not Significantly Advanced When Used in U.S. Food Aid 
Programs, GAO/GGD-94-215 (Washington, D.C.: September 1994). Cargo 
Preference Requirements: Their Impact on U.S. Food Aid Programs and the 
U.S. Merchant Marine, GAO/NSIAD-90-174 (Washington, D.C.: June 1990). 

[27] In addition to dropping the rations, the Air Force dropped 21,000 
55-pound sacks of wheat and 42,000 blankets. 

[28] During the 1990s, FAO's emergency and longer-term development 
efforts were conducted under strategies and programs managed by UNDP. 

[29] USAID spent approximately $23 million on agriculture assistance in 
Afghanistan in 2002.

[30] Annex III of the Bonn Agreement states that the participants in 
the UN Talks on Afghanistan hereby urge the UN, the international 
community, particularly donor countries and multilateral institutions, 
to reaffirm, strengthen and implement their commitment to assist with 
rehabilitation, recovery, and reconstruction of Afghanistan, in 
coordination with the Afghan government.

[31] Immediate and Transitional Assistance Program for the Afghan 
People, January 17, 2002.

[32] Security Council Resolution 1401 (2002), S/RES/1401, March 28, 
2002.

[33] The framework is organized around three "pillars": (1) 
humanitarian assistance and human social capital, (2) physical 
reconstruction and natural resources, and (3) private sector 
development. Under the three pillars there are 12 programs supported by 
a number of subprograms. Subprograms for agriculture and irrigation 
fall under "Pillar 2, Physical Reconstruction and Natural Resources, 
program for Natural Resources Management." 

[34] Donor nations have taken the lead in other sectors. Specifically, 
the United States leads in training the national army, Germany in 
training the police, Italy in rebuilding the judicial system, and the 
United Kingdom in drug control. These donor nations, in consultation 
with the Afghan government and the international community, have 
developed strategies for reconstructing their respective sectors.

[35] Consultative group is a World Bank term used to describe a process 
of consultations between the government of a recipient developing 
nation and the international assistance community. Typically, the 
process involves monthly group meetings in country on sectoral or 
thematic issues. Such working groups bring together interested parties, 
including ministry representatives, donors, nongovernmental 
organizations, and UN agencies, to discuss strategic planning and 
improve coordination.

[36] There are 12 program area-based consultative groups that 
correspond to the 12 program areas contained in the Afghan government's 
National Development Framework. Two additional consultative groups deal 
with national security issues (national army and national police). The 
groups report to a consultative group standing committee during an 
annual national consultative group meeting.

[37] The budget contains three types of prioritized projects: (1) 
projects designed primarily by the Afghan government and funded through 
the national budget, (2) projects primarily designed by donors and 
funded and implemented by donors, and (3) conceptual projects for which 
funding and implementation arrangements have not been determined.

[38] According to the UN, "assistance management" refers to the 
effective implementation of donor-funded development programs.

[39] Assistance proposed in these strategies includes technical 
assistance, inputs such as seeds and fertilizer, capacity building for 
government staff, irrigation repair, water resource management, 
livestock rehabilitation, and credit to small farmers, among other 
things.

[40] Government Performance and Results Act of 1993 P.L.103-62. U.S. 
General Accounting Office Congressional Review of Agency Strategic 
Plans, GAO/GGD-10.1.16 (Washington, D.C.: January 1995). Office of 
Management and Budget, Circular A-11, Part 6--Preparation and 
Submission of Strategic Plans, Annual Performance Plans, and Annual 
Program Performance Results (Washington, D.C.: June 2002).

[41] Government Performance and Results Act.

[42] UNDP, Asian Development Bank, and the World Bank, Preliminary 
Needs Assessment for Recovery and Reconstruction (Tokyo: 2002). The 
assessment was prepared by UNDP, the Asian Development Bank, and the 
World Bank to help determine the requirement of external assistance to 
support Afghanistan's economic and social recovery and reconstruction 
over the short and medium terms. During the January 2002 conference, 
the Afghan government identified agricultural and rural development, 
including food security, water management, and revitalizing irrigation, 
as one of six areas essential for reconstruction.

[43] This figure was revised from $4.5 billion because of increases in 
pledges. This total included $3.8 billion in grants and $1.4 billion in 
loans. The initial pledge of $1.8 billion for 2002 was revised to $2.1 
billion.

[44] Overall U.S. assistance to Afghanistan in 2002 totaled $717 
million, or 6.2 percent of worldwide U.S. bilateral assistance 
obligations in that year. Most of this amount was not for 
reconstruction but for humanitarian assistance, including food aid.

[45] The international community has not published a figure for total 
agricultural assistance to Afghanistan. This estimate is derived from 
available Asian Development Bank, European Union, European Commission, 
UN, U.S., and World Bank data. 

[46] FAO estimates that it will take at least 10 years to rebuild the 
agricultural sector.

[47] The level of USAID's agricultural assistance will remain the same 
in 2004 and 2005, accounting for about 16 percent of the Afghan 
government's natural resources and management budget in 2004 and 11 
percent in 2005.

[48] Incidents included the attempted assassinations of the Minister of 
Defense and the President; the murder of an International Committee of 
the Red Cross staff member; rocket attacks on U.S. and international 
military installations; and bombings in the center of Kabul, at the 
International Security Assistance Force headquarters, and at UN 
compounds. There are approximately 4,900 International Security 
Assistance Force troops located in Kabul. These troops provide security 
only for the city of Kabul and the immediate vicinity.

[49] USAID plans to spend $30 million in 2003 on demobilization 
efforts.

[50] In 2001, the United States estimated that the Taliban collected at 
least $40 million in taxes on opium.

[51] UN Office for Drug Control and Crime Prevention, Geneva, October 
2002.

[52] The value of Afghanistan's 2002 opium crops was equivalent to 17 
percent of its gross domestic product.

[53] Although some poppy farmers are wealthy, many are poor farmers 
with just enough land and water for poppies but not enough resources to 
plant traditional or alternative crops. For many of these poor farmers, 
the decision to cultivate poppies causes moral anguish, as they regard 
its cultivation to be highly un-Islamic.

[54] Prices paid to farmers range from $350 to $400 per kilogram. One 
kilogram equals 2.2 pounds.

[55] We contacted the Agency for Technical Cooperation and Development 
(ACTED), Action Contre la Faim, Afghanaid, Canadian Relief Foundation, 
CARE International, Focus, Goal, International Rescue Committee, 
Islamic Relief, Madera, Norwegian Assistance Committee, Save the 
Children, Solidarte, and World Vision.

[56] WFP employs a total of 78 local monitors with an average of 3 
years of WFP experience. Approximately 90 percent of these monitors 
have a college degree. In addition to the monitors, implementing 
partners make monitoring visits in areas where WFP staff cannot travel 
owing to security concerns.

[57] In 1988 the Agency Coordinating Body for Afghanistan Relief was 
established to coordinate the efforts of national and international 
nongovernmental organizations conducting work in Afghanistan. The 
agency's membership included 68 Afghan and international 
nongovernmental organizations. The Afghan Support Group formed in 1997 
was a donor coordination group composed of 16 donor nations.

[58] Terms of reference prepared by the lead ministry and presented to 
the group members for further discussion and agreement will outline 
both specific and general responsibilities of group members as well as 
set clear benchmarks for preparing and implementing national programs. 
The terms of reference will also specify clear submission deadlines for 
the national budget and programs and address reporting, including 
monthly updates of indicators of progress in the program area and 
monitoring of benchmarks.

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