Afghanistan Reconstruction: Despite Some Progress, Deteriorating Security and Other Obstacles Continue to Threaten Achievement of U.S. Goals
Published: 2005-07-28T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: In October 2001, coalition forces forcibly removed the Taliban regime from Afghanistan, responding to their protection of al Qaeda terrorists who attacked the United States. Congress subsequently passed the Afghanistan Freedom Support Act of 2002 authorizing funds to help Afghanistan rebuild a stable, democratic society. The act directed GAO to monitor the implementation of U.S. humanitarian, development, and counternarcotics assistance. This report analyzes, for fiscal year 2004, (1) U.S. obligations and expenditures, (2) progress and results of assistance efforts, (3) assistance management and coordination, and (4) major obstacles that affected the achievement of U.S. goals.
section_title: What GAO Found
paragraphs: The United States spent $720 million on nonsecurity-related assistance to Afghanistan in fiscal year 2004. Approximately 75 percent paid for reconstruction activities, with the remainder supporting humanitarian and quick-impact projects. Conversely, in 2002-2003, humanitarian and quick-impact assistance accounted for more than three-fourths of U.S. spending. The United States continued to be the largest donor, contributing about 38 percent of the $3.6 billion pledged by the international community. U.S. humanitarian assistance benefited vulnerable populations in fiscal year 2004. Further, the United States increased reconstruction assistance to Afghanistan and made notable progress in several sectors through its "Accelerating Success Initiative". Although progress varied among sectors, the United States did not meet all of its targets due to security and other obstacles. For example, USAID intended to rehabilitate or build 286 schools by the end of 2004. However, owing to poor contractor performance and security problems, by September 2004 it had completed only 8. As in 2002-2003, complete financial information was not readily available, and USAID lacked a comprehensive strategy to direct its efforts. Further, USAID did not consistently require contractors to fulfill contract provisions needed to ensure accountability and oversight. USAID also did not systematically collect information needed to assess the progress of its major projects. Moreover, measures provided by the embassy to decision-makers in Washington did not comprehensively portray progress in each sector or the overall U.S. program. Deteriorating security, increased opium production, and delayed funding continued to obstruct U.S. reconstruction efforts in fiscal year 2004 and threatened the achievement of U.S. goals. Deteriorating security rendered large areas inaccessible to the assistance community, and the continued rise in opium production undermined legitimate economic activity. In addition, most assistance funds were not available until nearly 6 months into the fiscal year, preventing USAID from accelerating reconstruction efforts.

section_title: Letter
paragraphs: In 2001, when U.S. and coalition forces removed the Taliban regime from  power in Afghanistan, the country faced the task of rebuilding itself.  Almost a quarter century of war and years of drought had destroyed  Afghanistan’s government, judicial, economic, and social institutions and  its transportation, health, and other infrastructure. To help rebuild the  country and create a stable Afghan society that would not be a threat to  itself or others, in fiscal years 2002 and 2003 the United States spent $900  million on humanitarian and reconstruction projects. In June 2004, we  reported that U.S. humanitarian and short-term assistance over the 2-year  period had helped Afghanistan’s vulnerable population but that longer-term  reconstruction efforts achieved limited results in creating a stable Afghan  society. Delayed U.S. funding, small staff size, inadequate working  conditions, and a lack of a comprehensive strategy impeded progress; at  the same time, security deteriorated and opium production increased. In  October 2003, to speed reconstruction and produce visible signs of  progress before Afghanistan’s first presidential elections in 2004, the  United States implemented the “Accelerating Success in Afghanistan”  initiative.
The Afghanistan Freedom Support Act of 2002 directs the U.S. Government  Accountability Office (GAO) to monitor U.S. humanitarian, reconstruction,  and counternarcotics assistance to Afghanistan. To meet this requirement  and provide Congress with a comprehensive accounting of U.S.  nonsecurity related assistance to Afghanistan for fiscal year 2004, we  analyzed (1) U.S. obligations and expenditures, (2) the progress and results  of U.S. humanitarian and reconstruction efforts, (3) the management of  U.S. assistance and mechanisms to coordinate U.S. and international  assistance, and (4) the major factors that obstructed the advancement of  the assistance effort and the achievement of U.S. policy goals.
To address these issues, we collected and analyzed information from the  U.S. Departments of Agriculture, Defense, Health and Human Services,  State, and the Treasury; the U.S. Agency for International Development  (USAID); the United Nations (UN); the Afghan government; and  nongovernmental organizations and private contractors responsible for  implementing U.S. government–funded projects. We analyzed data on  obligations and expenditures by U.S. government agencies providing  assistance to Afghanistan in fiscal year 2004. We conducted reliability  checks of the financial data provided by U.S. agencies and determined that  the data are sufficiently reliable for the purposes of our analysis. To  determine the reliability of the data, we contacted each of the agencies  providing assistance and each of the offices within each agency responsible  for managing specific components of the assistance, cross-checked and  corroborated the financial information provided, and created a  consolidated financial database of U.S. assistance to Afghanistan. This  effort was necessary because there is no single, consolidated source of  obligation and expenditure data for U.S. assistance to Afghanistan.  Because U.S. assistance to Afghanistan is provided as part of a larger effort  by the international community, we also analyzed information on the  contributions of other donors. In addition, we traveled to Afghanistan in  October 2004 to examine U.S. assistance-related operations in the country.  While in Afghanistan, we spoke with officials from U.S., UN, and  nongovernmental organizations; private contractors; and the Afghan  government; however, the number and location of project sites we visited  in Afghanistan were limited owing to Department of State security  restrictions. We conducted our review from August 2004 through May 2005  in accordance with generally accepted government auditing standards.  (For further details of our objectives, scope, and methodology, see app. I.)
subsections: section_title: Background
paragraphs: Afghanistan is a mountainous, arid, landlocked country with limited natural  resources, bordered by Pakistan to the east and south; Tajikistan,  Turkmenistan, Uzbekistan, and China to the north; and Iran to the west  (see fig. 1). At 647,500 square kilometers, Afghanistan is slightly smaller  than the state of Texas; its population, estimated at between 24 and 30  million, is ethnically diverse, largely rural, and mostly uneducated. The  country is divided into 34 provinces.
Afghanistan is one of the world’s poorest countries. As table 1 shows,  development indicators published by the World Bank and the UN rank  Afghanistan at the bottom of virtually every category, including nutrition;  infant, child, and maternal mortality; life expectancy; and literacy.
Over the last two decades, political conflicts ravaged Afghanistan (see fig.  2). Factional control of the country following the withdrawal of Soviet  troops in 1989, coupled with the population’s fatigue of fighting, allowed a  fundamentalist Islamic group, the Taliban, to seize control of the country.  Although the Taliban regime provided some political stability during the  late 1990s, its destructive policies, highlighted in its repressive treatment of  women, and its continuing war with the opposition Northern Alliance  further impeded international aid and development.
In December 2001, less than 2 months after U.S. and coalition forces  forcibly removed the Taliban regime, a 9-day international summit in Bonn,  Germany, established a framework for a new Afghan government. This  framework, known as the Bonn Agreement, focused on writing a new  constitution by the end of October 2003 and holding democratic elections  by June 2004. The agreement was endorsed by the UN Security Council on  December 6, 2001, through UN Resolution 1383.
In December 2002, the United States passed the Afghanistan Freedom  Support Act of 2002, authorizing increased assistance to Afghanistan. The  U.S. goal is to firmly establish Afghanistan as a democratic nation  inhospitable to international terrorism and drug trafficking and cultivation,  at peace with its neighbors, and able to provide its own internal and  external security. U.S. efforts in support of this goal are intended to help  create national security institutions, provide humanitarian and  reconstruction assistance, and reinforce the primacy of the central  government over Afghanistan’s provinces. The act strongly urged the  President to designate a coordinator within the Department of State to,  among other things, be responsible for (1) designing an overall strategy to  advance U.S. interests in Afghanistan; (2) ensuring program and policy  coordination among U.S. agencies; (3) coordinating assistance with other  countries and international organizations; and (4) ensuring proper  management, implementation, and oversight by agencies responsible for  assistance programs.
The U.S. Agency for International Development (USAID) provides U.S.  assistance to underdeveloped countries through UN agencies,  nongovernmental organizations, and private contractors. The main  organizational units responsible for managing USAID’s reconstruction  programs and operations in Afghanistan in fiscal year 2004 were the  agency’s mission in Kabul, Afghanistan; the Bureau for Asia and the Near  East; and the Bureau for Democracy, Conflict, and Humanitarian  Assistance through the Office of U.S. Foreign Disaster Assistance, Office of  Food for Peace, Office of Transition Initiatives (OTI), and Office for  Democracy and Governance. Other U.S. government agencies provided  additional assistance, including DOD through its provincial reconstruction  teams (PRT) located at sites throughout Afghanistan. In fiscal year 2004,  the 12 U.S.-led PRTs ranged in size from 60 to 100 civilian and military  personnel, including civil affairs units, force protection soldiers, and  representatives of the Departments of Agriculture and State and USAID.  The teams are intended to deliver assistance that advances military goals  and enhance security, to increase the reach of the Afghan central  government in the provinces and allow assistance agencies to implement  projects.
In spring 2003, DOD, recognizing the lack of progress in the U.S. effort in  Afghanistan, drafted a political-military strategy for Afghanistan. The  strategy did not include reconstruction. The strategy was vetted by the  National Security Council and approved by the President in June 2003. At  the time, Department of State and USAID officials drafted a plan to  increase funding and expedite reconstruction efforts, particularly in  infrastructure, democratization and human rights, and security. This plan  served as the basis for the Accelerating Success in Afghanistan Initiative  announced by the U.S. government in September 2003. The initiative was  designed to be implemented in advance of the Afghanistan Presidential  elections scheduled for June 2004. The U.S. government planned to provide  $1.76 billion for the initiative, targeting approximately $1 billion of this  amount for elections, major and secondary road construction, health and  education programs, economic and budget support to the Afghan  government, senior advisors and technical experts, and private sector  initiatives. The remaining $700 million was to fund efforts to build the  Afghan National Army, train and equip the police force, expand the  counternarcotics program, and establish rule of law.
section_title: U.S. Spending in 2004 Focused on Reconstruction
paragraphs: In fiscal year 2004, the focus of U.S. spending in Afghanistan shifted from  humanitarian and quick-impact assistance to reconstruction. Of the nine  U.S. government departments and agencies involved in assistance to  Afghanistan, USAID provided the largest amount of nonsecurity-related  assistance. The largest investment went to USAID’s infrastructure sector,  which received approximately half of the agency’s total obligations for  Afghanistan in fiscal year 2004. About two-thirds, or $922 million, of  USAID’s obligations supported local projects in Afghanistan’s 34 provinces,  with Kabul and Kandahar provinces receiving approximately 70 percent of  these funds, mainly for roads. The United States provided the largest share  of international assistance to Afghanistan, contributing about 38 percent of  the $3.6 billion that the international community pledged for 2004.
subsections: section_title: U.S. Spending Shifted to Longer-Term Reconstruction
paragraphs: The focus of U.S. spending in Afghanistan in fiscal year 2004 shifted from  humanitarian and quick-impact assistance, such as building wells, to larger- scale reconstruction. The U.S. government obligated about $1.4 billion and  spent approximately $720 million on nonsecurity-related assistance to  Afghanistan; the largest percentage of this amount was spent on  reconstruction, especially infrastructure projects. In contrast to fiscal  years 2002-2003, when more than three-fourths of U.S. spending was for  humanitarian and quick-impact assistance, approximately 75 percent—  about $538 million—of the 2004 expenditures supported reconstruction  and development projects. The remaining amount was spent on  humanitarian and quick-impact projects. (See fig. 3)
section_title: USAID Provided Most U.S. Funding
paragraphs: Of the U.S. government departments and agencies providing assistance in  Afghanistan, USAID spent the largest amount, about $587 million, for  reconstruction, humanitarian, and quick-impact projects. The Department  of State spent the next largest amount, about $70 million, primarily for  assistance to refugees. DOD spent approximately $45 million for  nonsecurity-related assistance, chiefly small projects through the  Commanders’ Emergency Response Program. Six other U.S. government  agencies also provided some assistance to Afghanistan in fiscal year 2004.  (See fig. 4 for agency percentages; for more details, see app. II.)
About half—$497 million—of USAID’s fiscal year 2004 obligations for  reconstruction in Afghanistan supported the rebuilding of infrastructure.  This amount includes $448 million obligated for large infrastructure  projects, such as roads, of which USAID spent approximately $236 million.  To build schools and clinics, USAID obligated $49 million, of which it spent  less than $6 million. USAID and DOD obligated $44 million and $47 million,  respectively, through the PRTs, mainly for small-scale infrastructure  projects.
section_title: Kabul and Kandahar Received Most U.S. Assistance
paragraphs: In an effort to expand the reach of the Afghan government—a major U.S.  and Afghan government priority—USAID directed about two-thirds, or  $922 million, of its obligations to local projects in Afghanistan’s 34  provinces, with Kabul and Kandahar provinces receiving approximately 70  percent of these funds (see fig. 5). The remaining funds went to national  programs, such as government reform initiatives. USAID directed the  majority of the funds obligated for Kabul and Kandahar—approximately  $527 million of a total $647 million—toward road construction. In  addition, DOD distributed approximately $47 million throughout the areas  covered by the PRTs, the majority of them near Afghanistan’s border with  Pakistan.
section_title: United States Remained Largest International Donor
paragraphs: As in previous years, the United States provided the largest share of  international assistance to Afghanistan, contributing about 38 percent of  the $3.6 billion pledged by the international community for 2004. (See fig. 6;  for 2004 pledges by donor, see app. II.) The U.S. share for 2001-2003 was  about 34 percent of the approximately $9.7 billion pledged by the  international community. According to the Center on International  Cooperation, as of February 2005, donors had obligated about 29 percent,  or $3.9 billion, of the $13.4 billion pledged since 2001.
section_title: U.S. Assistance Benefited Afghanistan, but Accelerated Reconstruction Did Not Meet All Targets
paragraphs: U.S. humanitarian and quick-impact assistance benefited vulnerable  populations and returning refugees; however, the success of efforts to  accelerate large-scale reconstruction varied. USAID provided almost $60  million in emergency assistance, including food aid, and the Department of  State provided about $60 million to assist refugees in fiscal year 2004. In  addition, the U.S. government obligated approximately $120 million for  small-scale, quick-impact projects such as the construction of wells and  bridges. Further, the United States accelerated its major reconstruction  programs to increase visible progress before the 2004 Afghan presidential  elections. However, progress and results in each of the reconstruction  sectors—agriculture, democracy and governance, economic governance,  education, health, infrastructure, and gender—varied, as did the problems  each sector faced.
subsections: section_title: U.S. Government Responded to Ongoing Humanitarian Crisis
paragraphs: In fiscal year 2004, the U.S. government provided food and other  emergency assistance to Afghanistan’s vulnerable populations and assisted  the return of refugees. Afghanistan suffered its sixth year of drought and  produced a below-average harvest, and the percentage of people in need of  food aid rose from 20 percent in 2003 to an estimated 37 percent in 2004. In  addition, approximately 900,000 refugees returned to Afghanistan, with  more expected to return in coming years owing to the closing of refugee  camps operated by the UN High Commissioner for Refugees (UNHCR) in  Pakistan.
USAID’s Office of Food for Peace, through the UN World Food Program  (WFP), provided Afghanistan with 79,330 metric tons of wheat and other  emergency food assistance (valued at $49 million) in fiscal year 2004,  which equaled approximately 25 percent of the international food  assistance that WFP requested during that time period. In addition, USAID,  through its Office of Foreign Disaster Assistance, provided almost $10  million in other emergency assistance in fiscal year 2004, compared with  $137.8 million in fiscal years 2002 and 2003. According to USAID, the office  supported transitional shelter for refugees; the return of internally  displaced persons; winter programs, such as snow clearance and road  rehabilitation; and emergency funds to respond to the ongoing drought.
The Department of State’s Bureau of Population, Refugees, and Migration  (PRM) provided almost $63 million to help refugees, compared with $234  million in previous years. PRM provided more than half of the 2004 funding  through the UNHCR to support traditional assistance, such as shelter and  education for refugees. In addition, the agency facilitated out-of-country  registration and voting so that Afghan refugees living in Pakistan and Iran  could vote in the October 2004 Afghanistan presidential election. PRM also  provided funds through the International Committee of the Red Cross and  UN Children’s Fund, as well as about $17 million in direct grants to  nongovernmental organizations. These grants provided shelter, water and  sanitation, health care, education, and economic assistance and training to  refugees and internally displaced people. PRM provided funding for the  construction of 5,900 shelters; however, as of September 30, 2004, 8,000  shelters were still needed.
section_title: USAID and DOD Continued Quick-Impact Efforts
paragraphs: In fiscal year 2004, USAID and DOD continued efforts to respond rapidly to  small-scale reconstruction needs in Afghanistan. USAID launched the  Quick-Impact Program (QIP), supplementing the activities of the existing  Office for Transition Initiatives, and DOD launched the Commanders’  Emergency Response Program (CERP) to operate alongside its Overseas  Humanitarian, Disaster, and Civic Aid (OHDACA) program (see table 2).  The aims of these programs is to extend the reach of the Afghan central  government through benefits to rural communities and to facilitate the  transition to longer-term reconstruction programs. Although CERP and  OHDACA funds address humanitarian needs, the projects are determined  by the tactical need to obtain the support of the populace and are primarily  tools for achieving U.S. security objectives. Since 2002, the U.S.  government has programmed almost $136 million for about 3,600 small- scale, quick-impact projects through USAID and DOD.
CERP and QIP funds worked in tandem through the PRTs in fiscal year  2004, with CERP funding smaller projects costing less than $20,000 on  average and QIP funding larger, more expensive projects. DOD regulations  allow PRT commanders to approve the use of up to $25,000 in CERP  funds for the rapid implementation of small-scale projects, such as  providing latrines for a school or a generator for a hospital. USAID  representatives at PRTs used QIP funds for larger, more complex projects  such as local roads, bridges, and government buildings. To ensure  accountability and long-term sustainability, USAID regulations require that  the mission, before granting approvals for QIP projects, conduct technical  assessments and ensure Afghan government involvement in projects. DOD  does not require similar assessments for CERP-funded projects.
section_title: Progress in Accelerated Reconstruction Projects Varied by Sector
paragraphs: Efforts to accelerate existing USAID programs in each reconstruction  sector—agriculture, democracy and governance, economic governance,  education, health, and infrastructure—achieved varying degrees of  progress toward project objectives and accelerated targets. Efforts to promote gender equity in each sector also demonstrated varying levels of  progress.
Although the 2004 Accelerating Success initiative targets for the agriculture  sector were generally met or exceeded, the contractor failed to integrate  project activities, thus limiting the project’s results. To address the needs  of the agriculture sector, USAID implemented the Rebuilding Agricultural  Markets Program in 13 of Afghanistan’s 34 provinces, concentrating the  program’s activities on physical infrastructure, rural finance, and  agricultural technology and market development. USAID signed the  program’s $153 million primary 3-year contract on July 3, 2003. The  contractor, Chemonics International, Inc., was to use a “market chain”  approach to improve the operations of, and linkages between, the market  chain components (i.e., farmers, processors, transporters, input suppliers,  creditors, regulators, wholesalers, and retailers).
As of September 2004, Chemonics had implemented numerous activities  through subcontracts and grants with 40 organizations, including local and  international nongovernmental organizations, private firms, and  international organizations. The progress of these activities as reported by  Chemonics is as follows:  Physical infrastructure. By September 2004, over 320 kilometers of  irrigation canals, approximately 230 irrigation structures, and about 160  kilometers of farm to market roads had been rehabilitated. In addition,  nearly 120 market structures such as retail market stalls and grain and  vegetable storage sheds had been constructed.
Rural finance. Over 1,100 loan officers had been trained, and more  than 8,000 loans had been disbursed.
Agricultural technology and market development. About 565,000  farmers were served by extension services; over 4,000 women being  trained in poultry management; over 20,000 chickens had been  distributed to women; and more than 3,675,000 livestock had been  treated, vaccinated, or both.
Data provided by Chemonics and U.S. government interagency  performance reports indicated the program generally met or exceeded all  of the Accelerating Success targets established for the sector; however, the  program did not address a key program objective. We found that  Chemonics had not integrated individual activities to achieve project  objectives or focused its efforts on the improvement of market chains.  USAID and Chemonics officials told us in October 2004 that although many  activities had been implemented, most projects were stand-alone  agricultural infrastructure efforts (e.g., road and canal rehabilitation) and  did not focus on improving the marketing of commodities or the integration  of market chain components. Consequently, during its first 15 months, the  project’s progress in strengthening Afghanistan’s market chain was limited.  An internal evaluation of the Chemonics effort was conducted by USAID  mission staff in Kabul in mid-fiscal year 2004. The evaluation resulted in the  development of a new strategy and performance monitoring plan in an  effort to refocus RAMP and better integrate program activities.
USAID’s democracy and governance program produced notable successes,  particularly its assistance with the creation and ratification of Afghanistan’s  constitution and with the presidential elections. However, some civic  education programs were uncoordinated and had limited distribution.  USAID’s fiscal 2004 democracy and governance program comprised three  components: Strengthening of elections and political process. The Consortium  for Elections and Political Process Strengthening component addressed  civic education and political party building. Under USAID’s Accelerating  Success initiative, the consortium’s funding ceiling increased from $3.76  million to $13.36 million. Grantees reported training more than 2,000  district and village leaders in civic education, registering 46 political  parties by the end of fiscal year 2004, and establishing eight election  training and information centers.
Judicial reform. In May 2004, under the Accelerating Success  initiative, USAID increased its contract with Management Systems  International (MSI) from $14.7 million to $16.8 million. USAID also  revised the scope of work to focus on judicial rehabilitation and added  court administration as an objective. MSI provided technical assistance  and logistical support to the constitutional commission and its  secretariat and to the constitutional loya jirga that took place in  December 2003. According to USAID and MSI reports, MSI also built or  rehabilitated 7 of 10 targeted courthouses by September 30, 2004; helped  review, draft, and track the status of legislation; surveyed and compiled  laws and legal texts; mapped courthouse administration functions; and  conducted training for about 300 legal professionals.
Loya jirga and elections logistics. USAID awarded the Asia  Foundation a cooperative agreement to provide operational and logistic  support for the constitutional loya jirga and elections. The award’s  funding ceiling increased from $10 million to more than $45 million. The  scope expanded to include assistance to the UN Assistance Mission to  Afghanistan to conduct the loya jirga, register voters, and hold the  presidential election. The foundation filled unforeseen gaps in the UN’s  efforts, as UN staff faced security restrictions that limited their ability to  register voters and set up polling stations. According to the UN, more  than 10 million people registered to vote, out of a total population of  between 24 and 30 million; about 40 percent of those registered were  women.
Despite these successes, the program faced setbacks, particularly in public  education and courthouse construction. Parts of the civic education  program were poorly timed. According to an evaluation commissioned by a  USAID grantee, a listening device to enhance the public’s understanding of  the election process was distributed late, in some cases just 1 week before  elections and with no training, making it difficult for users to listen to all of  the content; the evaluation found that users would have preferred to have  received the device 2 months before the elections. In addition, there were  delays in the project’s initiative to draft and pass legislation, due to shifting  responsibility for legislative drafting from the Judicial Reform Commission,  a temporary entity, to the permanent Ministry of Justice. Finally, despite a  goal of building or rehabilitating 10 courthouses by the end of fiscal year  2004, according to USAID and contractor reporting, only 7 were completed  due to late funding.
Despite many achievements, problems pertaining to the selection of  advisors and sustainability affected the economic governance program. In  December 2002, USAID signed a 3-year, $39 million Sustainable Economic  Policy and Institutional Reform Support program contract with Bearing  Point, Inc., to provide technical assistance and training to the primary  Afghan ministries concerned with economic governance issues. In April  2004, as part of the Accelerating Success initiative, USAID increased  funding for the contract to $95.8 million. Most of the work under the  contract was implemented by advisors and operations staff assigned  primarily to the Ministry of Finance and the Central Bank. As of August  2004, approximately 224 advisors were working within the Ministry of  Finance. Some of the advisors worked directly with the management of the  ministry, others served in operational positions and were responsible for  carrying out the day-to-day functions of the ministry. According to the  USAID mission in Kabul, USAID’s Inspector General, and an evaluation  commissioned by the Afghan government, Bearing Point made progress  toward completing the approximately 120 “contractor responsibilities”  listed in the contract. Accomplishments included the following:  Fiscal reform. Bearing Point developed a system to estimate  government revenues; introduced a taxpayer identification number  system; trained Afghans to develop and monitor budgets; established a  national payments system; developed a customs broker licensing  program, reformed customs operations and trained customs officials;  rehabilitated and equipped customs houses and border posts; and  developed a database of customs revenues.
Banking reform. The contractor helped the Afghan Central Bank  establish national and international operations via standard banking  telecommunications networks, implement bank licensing policies and  procedures, restructure and equip branch banks, and draft banking  laws.
Trade policy. The assistance provided helped the Afghan government  streamline its business license application process, reducing the time to  obtain a license from months to less than 1 day and reducing the number  of required signatures from 58 to 6. In addition, the contractor also  assisted the government in reviewing and drafting commercial decrees  and laws.
Legal and regulatory reform. The contractor assisted Afghan  ministries in drafting key laws and establishing a telecommunications  regulatory body.
Privatization. As of October 2004, little work had been conducted in  the area of privatization, because the Afghan government was not ready  to privatize state-owned enterprises.
Despite these accomplishments and USAID’s efforts to adjust the program  to meet the government of Afghanistan’s needs, the Ministry of Finance  remained dissatisfied with the cost and quality of the assistance provided  by some of the expatriate advisors hired under the contract and sought to  terminate it. In mid 2004, the Afghan government requested a review of the  program. The first evaluation, completed in September 2004, found that,  among other things, Bearing Point lacked an effective means for  determining ministry needs. USAID disagreed with the evaluation’s  findings and maintains that Bearing Point worked closely with the  ministries receiving assistance and worked proactively to meet their needs.  According to the Central Bank governor, the bank—the other major  recipient of assistance under the contract—was generally satisfied with the  assistance provided. In November, the Ministry of Finance agreed to allow  the contract to continue until its completion date, December 2005.
In addition, in October 2004, the Minister of Finance and the Governor of  the Central Bank were still concerned that their agencies would not be able  to sustain operations after the program’s completion. To address this  concern, USAID and Bearing Point initiated plans to transfer local Afghans  working as their contractors to Afghan civil service. These individuals  would be paid with funds provided by the international community through  the Afghanistan Reconstruction Trust Fund. In addition, the Central Bank  began testing the abilities of its staff on a periodic basis to determine their  ability to work in the absence of international advisors and to identify areas  where additional training was needed prior to the Bearing Point contract’s  completion.
USAID’s Afghanistan Primary Education Program (APEP) provided  educational and teacher-training programs to help improve basic  education; however, under the Accelerating Success initiative, very few  schools were constructed and other components were not integrated into  educational facilities as originally envisioned.
USAID’s education program originally focused its efforts in four areas:  textbook production and distribution, radio-based teacher training,  accelerated learning, and school construction. USAID provided the bulk of  its education assistance in Afghanistan through APEP, run by Creative  Associates International, Inc. APEP was designed to ensure that newly  constructed schools were functional centers of learning by providing  textbooks, skilled teachers and opportunities for accelerating the learning  of over-aged students. The Accelerating Success initiative increased  APEP’s funding ceiling from $16.5 million to $87.6 million, but it decoupled  the provision of materials and training from school construction. The  initiative introduced three additional components: in-country textbook  production; educational support services to help reform policies, systems,  and programmatic changes; and enhanced monitoring and evaluation.  Progress under the APEP contract included the following: Textbook production: According to the USAID Regional Inspector  General, USAID exceeded its textbook production goal for 2004,  producing about 16.5 million books, but distribution was delayed.
Radio teacher training: According to the targets in the original APEP  contract, the radio teacher training broadcasts aimed to improve the  teaching skills of about 30,000, or about 96 percent of all primary school  teachers by the end of 2004. Under the Accelerating Success initiative,  the goal was reduced to reaching up to 40 percent of Afghan teachers  nationwide. After a mid-2004 survey of, primarily, participants in U.S.  education programs, USAID concluded that 70 to 90 percent of all  primary school teachers were listening to the radio teacher training  broadcasts and the number of listeners was increasing monthly.
Accelerated learning: APEP’s goal was to raise the educational levels  of 80,000 over-aged students in 13 provinces and move them into age- appropriate levels by the end of 2004. Under the Accelerating Success  initiative, the goal was expanded to 170,000 students in 17 provinces.  Under both plans, APEP intended 70 percent of beneficiaries to be  female students. By the end of fiscal year 2004, USAID had met its  student enrollment objective, but less than 60 percent of students  enrolled were girls.
School construction: According to contract and grant  documentation, targets for school rehabilitation or construction shifted  under the Accelerating Success initiative from 50 schools to 286 schools  by the end of 2004. By September 2004, implementing partners reported  that 77 schools had been refurbished and 8 were substantially complete.
Educational support services: Under the Accelerating Success  initiative, APEP began to provide the Ministries of Education and Higher  Education with advisors to help draft education law, improve planning  capacity, and assess English language instruction needs.
Monitoring and evaluation: Under the original contract, APEP  produced weekly or biweekly updates, quarterly progress reports, and  an evaluation of the radio-based teacher training component. The  expanded scope includes a national study of students trained under the  accelerated program.
USAID also instituted several other smaller education-focused projects in  2004. These included a $10 million teacher-training institute and literacy  initiative and an $11 million dormitory to house between 1,100 and 1,500  university women in Kabul.
Despite some accomplishments, the project’s ambitious program made it  difficult to meet targets on many fronts. To address health sector issues,  USAID’s Rural Expansion of Afghanistan’s Community-based Healthcare  (REACH) program, in conjunction with the Ministry of Public Health,  established a nascent health care system and provided health services and  training for health providers. USAID’s REACH program, implemented by  Management Sciences for Health (MSH) under a 3-year contract, was  designed to improve the health of women of reproductive age and children  younger than 5 years. USAID’s Accelerating Success initiative increased  MSH’s original ceiling of approximately $100 million to $129 million. The  initiative expanded the scope of work to include, among other things, tertiary care in addition to the project’s original focus on rural health care.  USAID and MSH noted progress in five health care areas. The progress in  these areas as reported by MSH is as follows:  Health care facilities and community outreach. The program  reached its stated target of awarding $53 million in service delivery  grants to more than 250 clinical facilities in 13 provinces. Service in  these facilities covers a population of approximately 4.8 million.
Training for rural health care providers. The REACH program did  not meet its fiscal year 2004 target of training 46 midwives and 2,060  community health workers. By the end of 2004, according to  Management Sciences for Health reports, 75 midwives were in training  in Kabul, although none had finished the course, and almost 1,500  community health workers had been trained.
Public health education programs. REACH developed a policy on  health education with the Ministry of Public Health and helped the  ministry develop standard health promotion messages. Management  Sciences for Health reporting also indicated that REACH produced  seven radio dramas and trained 21 ministry and radio staff in radio  programming.
Ministry of Public Health capacity. REACH developed a national  health management information system and played an advisory role in  health sector reform, financing, and planning, as well as hospital  management. The REACH program helped to create a new human  resources department in the health ministry and to review and update  the national human resources policy for health staff. REACH also  contributed to the development of the National Drug Policy, the  National Medicine Agency, and donation guidelines for drug and  equipment donors. According to a midterm evaluation of the program,  REACH’s efforts have been sustainable.
Clinic construction. According to contract and grant documentation,  targets for clinic rehabilitation or construction shifted under the  Accelerating Success initiative from 50 clinics to 253 clinics by the end  of 2004. By September 2004, implementing partners reported that 15  clinics had been substantially constructed and none had been  refurbished.
USAID’s ambitious health care program stretched the capacity of  contractors, making it difficult to implement many projects simultaneously.  For example, according to the December 2004 USAID-commissioned  midterm evaluation, despite targets established in 2003, few clinics had  communication materials designed to change the health-related practices  of Afghans and most clinics remained focused on curative, rather than  preventative, care. Further, the evaluation found that despite a greater need  for community midwives than for hospital midwives, REACH developed  the capacity to train equal numbers of hospital and community midwives.  In addition, although the development of a national infection prevention  program was added to the Accelerating Success initiative, the program’s  schedule was delayed by 2 to 3 months owing to a delay in finding a  program manager.
USAID’s infrastructure program focused on some of Afghanistan’s large  infrastructure needs, including construction of the primary highway and  emergency electricity provision to four cities; however, progress has been  limited. USAID designed the Rehabilitation of Economic Facilities and  Services (REFS) program, to promote economic recovery and political  stability in Afghanistan by repairing selected infrastructure. To ensure  sustainability, USAID also designed REFS to strengthen pertinent  institutions’ management capacity, and to strengthen Afghan construction  companies’ ability to build according to international standards. The Louis  Berger Group, Inc., implemented most of the infrastructure work through  2004 under the 3-year REFS contract. Under the Accelerating Success  initiative, USAID increased REFS’ funding from $143 million to $665 million  and added 12 new awards with a collective funding ceiling of almost $400  million.
USAID’s fiscal year 2004 infrastructure programs included the following: Primary roads. USAID completed the first phase of the construction of  the Kabul-Kandahar Ring Road, which decreased travel time between  the two cities from several days to 6 hours. The second phase—adding  layers of asphalt, bridges, culverts, shoulders, and signage—was to be  complete by October 2004, but repair work continued into 2005. USAID  also mobilized contractors and started survey work to begin the next  section of the road, from Kandahar to Herat.
Secondary and urban roads. By fiscal year 2004, work had begun on  one urban road in Kabul, diverting traffic away from the U.S. Embassy,  and one secondary road to provide access between Kabul and a  southern city, Gardez. In addition, according to contractor reports,  planning or construction of nine additional secondary roads began;  however, by the end of fiscal year 2004, four were postponed due to lack  of funding.
Power. To increase the power supply around Kandahar in the south,  USAID began rehabilitation of two turbines for the Kajaki Dam. By the  end of fiscal year 2004, USAID was negotiating for construction of a  third turbine as well as seeking a solution to a power shortage in Kabul.  In the meantime, USAID supplied emergency power to Kabul, Kandahar,  Lashkar Gah, and Qalat by providing fuel for generators at the cost of  approximately $3 million per month.
Irrigation. USAID began work on several irrigation projects: the  emergency rehabilitation and reconstruction of the Saur-e-haus Dam,  spillway, and diversion channel; rehabilitation of the Zana Khan Dam;  the Sardeh Irrigation System; and three intake systems. By the end of  fiscal year 2004, construction of the Sardeh Irrigation System and two of  the intake systems had been completed.
Water/wastewater. By September 2004, USAID had contracted for  water availability assessments for two planned communities and for  water system assessments and design upgrades for three provincial  capitals.
Schools and clinics construction. In the initial infrastructure contract  with the Berger Group, USAID included the construction or  rehabilitation of 40 schools and clinics as an illustrative target to be  achieved by the end of 2003, with an additional 60 buildings to be  completed by the end of 2004. The actual job orders signed in July 2003  show that the Berger Group agreed to complete 55 schools and 78  clinics. By the end of September 2003, only 1 building was completed.  USAID reduced the Berger Group’s responsibility to 105 buildings and in  May 2004 provided grants to five additional organizations, with the goal  of rehabilitating or constructing a total of 774 buildings by October 31,  2004. In mid-2004, owing to, among other things, the education and  health ministries’ insistence on producing new as opposed to  refurbished buildings and a lack of progress by all implementing  partners, USAID, according to grant and contract documentation,  reduced its expectations to about 530 buildings and extended the  completion deadline to December 2004. By the end of fiscal year 2004,  the implementing partners reported having refurbished 77 buildings and  substantially completed new construction of 23 buildings.
Because the Accelerating Success initiative emphasized visible  construction, in addition to time and funding constraints, USAID largely  abandoned the REFS contract’s objective of building Afghan ministry  capacity in 2004. The Berger Group had recruited and hired experts to  supply intellectual capacity at the ministries of Public Works, Irrigation,  Health and Education; however, this project was discontinued in June 2004.
Although U.S. agencies focused on 10 of the 13 women-centered  objectives legislated by Congress, the overall impact of these efforts has  not been measured. (See app. III, table 17 for progress on objectives.)  Unlike programs for most reconstruction sectors, no overarching contract  was let to implement women-centered programs. Instead, U.S.-funded  programs incorporated components that advanced the social, economic,  and political rights and opportunities of women, dedicating about $196  million to such initiatives. For example, USAID provided more than 90,000  girls with education equivalent to one or more grade levels through the  APEP accelerated learning program and trained community health care  workers and midwives through REACH. USAID also provided democracy  and governance technical assistance, which helped over 3 million women  register for, and vote in, the 2004 presidential elections. USAID also  implemented other projects, such as reconstructing a women’s dormitory  to enable more than 1,100 young women to attend university in Kabul,  establishing a women’s teacher training institute, and, according to USAID,  completing 3 of 17 planned women’s resource centers in provincial  capitals. Other U.S. government agencies also incorporated women’s issues  into their work. For example, the Department of State granted $75,000 to  train four Afghan woman judges in civil and family law. Likewise, the DOD  included “Principles of non-discrimination: Women in Society” and other  pertinent classes in their curriculum for training the Afghan National  Police.
In addition, the U.S.-Afghan Women’s Council was created to accelerate  progress by promoting public-private partnerships between U.S. and  Afghan institutions and mobilizing private sector resources to benefit  women. The council raised about $135,000 of private sector funds from  entities such as an America Online women executives group and Daimler- Chrysler. These funds supplemented various U.S. government projects,  including training of women judges, the Afghan Family Health Book, and  community banks and microfinance loans. Many of the other projects  sponsored by the council, such as the Women’s Teacher Training Institute,  were funded and managed through USAID. Whereas USAID’s  reconstruction sector programs tend to target a broad range of women and  have a national scope, many of the council-supported projects impact a  small number of women.
Although U.S. legislation and assistance programs have included efforts to  address the needs of Afghan women, as of the time of this report, no  evaluation had been conducted to determine the overall impact of U.S.  gender-related efforts.
section_title: Assistance Management and Interagency Coordination Problems Persisted
paragraphs: Problems associated with the management and coordination of U.S.  assistance to Afghanistan occurred throughout fiscal year 2004. As in fiscal  years 2002-2003, the persistence of project management problems affected  agencies’ oversight of reconstruction contracts. U.S. financial data on  assistance to Afghanistan remained fragmented and incomplete, and  USAID continued to operate without a comprehensive operational strategy  to guide its efforts. In addition, USAID did not always enforce required  contract provisions, USAID directives, or a federal acquisition regulation  necessary to hold contractors accountable for their performance. In  addition, comprehensive performance indicators in most sectors were  lacking. Consequently, decision makers in Washington did not receive  meaningful information about the results of USAID–implemented projects.  Problems with project monitoring also continued in 2004, and although  USAID has taken steps to improve project monitoring, limited staffing and  security restrictions reduced its ability to provide proper oversight for  much of the fiscal year. Finally, although coordination of U.S. efforts  occurred daily throughout 2004, the evolving roles of U.S. organizations  and the coordination of international assistance were problematic.
subsections: section_title: Management Problems Impeded Oversight
paragraphs: During fiscal year 2004, a number of management problems negatively  affected the U.S. agencies implementing reconstruction projects and  prevented agency officials from providing project oversight. The tracking  of U.S. financial data for Afghanistan assistance remained fragmented and  incomplete. In addition, USAID continued to operate without a  comprehensive strategy to guide its overall assistance effort. Contract  management and performance measurement problems also impeded  oversight. Finally, staff turnover and travel restrictions negatively affected  USAID’s ability to provide regular on-site monitoring of project activities.
subsections: section_title: U.S. Governmentwide Financial Data Still not Readily Available
paragraphs: In fiscal year 2004, tracking of U.S. assistance financial data for  Afghanistan improved but remained fragmented and incomplete. In June  2004, we reported that the Coordinator for U.S. assistance to Afghanistan,  as well as others involved in the management of the assistance effort,  lacked complete and accurate financial data for fiscal years 2002 and 2003.  Because of the lack of accessible and timely financial data, program  managers were hampered in their ability to, among other things, allocate  resources and determine whether strategic goals were being met.
Although more information on assistance obligations was available in fiscal  year 2004 than in previous years, U.S. agencies remained unable to readily  supply complete and accurate financial data for programs in Afghanistan.  There was no single, consolidated source of fiscal year 2004 obligation and  expenditure data for U.S. assistance to Afghanistan. Consequently, as in  2002 and 2003, the embassy and the coordinator’s office continued to lack  complete and accurate financial data to inform their decisions. According  to the Embassy Interagency Planning Group, numerous organizations with  little coordination or oversight track the U.S. budgetary process for  assistance to Afghanistan, including obligation and expenditure data. To  address this problem, the embassy created an interagency resource office  in November 2004 to provide better visibility over all U.S. assistance  financial matters in Afghanistan.
section_title: USAID Strategic Guidance Still Lacking
paragraphs: As in previous years, USAID operated in fiscal year 2004 with an interim,  rather than a more complete, standard strategy for its activities in  Afghanistan. USAID directives allow the use of interim strategic plans in  countries experiencing high uncertainty because of drastic political, military, and/or economic events. In June 2004, we reported that  although the USAID mission in Afghanistan developed an interim strategy  and action plan in August 2002, these documents did not clearly articulate  measurable goals or provide details on time frames, resources,  responsibilities, objective measures, or the means to evaluate results for  each of the sectors targeted by the strategy, as required by USAID  directives. The mission obtained yearly waivers allowing it to postpone  developing a comprehensive strategy until February 2005. According to  USAID officials, the mission did not complete a comprehensive strategy in  fiscal year 2004 because it wanted to wait until the Afghan presidential  elections had been completed and a new government formed. USAID  officials informed us in July 2005 that a more comprehensive strategy had  been completed and approved by USAID management in Washington, D.C.  Although a new strategy was completed prior to the end of fiscal 2005,  more than 3 years have passed between the time USAID began providing  postconflict assistance to Afghanistan and the completion of a  comprehensive USAID assistance strategy for Afghanistan. The lack of a  comprehensive strategy impedes USAID’s ability to ensure progress toward  development goals, make informed resource allocation decisions, and meet  agency and congressional accountability reporting requirements on the  effectiveness of agency programs.
subsections: section_title: Contract Management Problems Reduced Oversight of Contractors
paragraphs: Contract management problems affected most reconstruction sectors,  making it difficult to hold contractors accountable. Oversight of the USAID  assistance contracts for Afghanistan was essential owing to the inherent risks associated with the use of cost-plus-fixed-fee contracts; the awarding  of contracts through bidding procedures that were not fully open and  competitive; the large initial dollar value and scope of the contracts and  large increases in the dollar values and scopes over time; and the  requirement to demonstrate progress quickly.
Despite the need for strong oversight of USAID assistance contracts, we  found that USAID did not provide adequate contract oversight, including  holding contractors to stipulated requirements and conducting required  annual reviews of contractor performance.
Agriculture. USAID did not hold its primary contractor to the  contract’s requirement to conduct five crop subsector assessments that  were to serve as the basis for the contractor’s annual work plans and all  future activities. According to the contractor, it did not complete the  assessments because USAID was pressing it to produce visible progress  through the construction of, among other things, irrigation canals and  farm-to-market roads by the Accelerating Success deadline. Although  USAID documented the contractor’s lack of performance, as of October  2004, it had not required the contractor to complete the assessments.
Economic governance. USAID’s regional Office of Inspector General  reported in August 2004 that, because the contractor failed to produce  contractually required quarterly work plans and schedules, the Office of  the Inspector General could not determine whether the economic  governance program was on schedule to achieve planned outputs.  According to the Inspector General’s report, USAID officials did not  require the contractor to produce the plans, in part because mission  staff in Kabul lacked time to review them. To correct this problem, the  contractor began producing quarterly work plans and schedules in July  2004.
Infrastructure. The use of grants instead of contracts to accelerate the  construction of some schools and clinics in fiscal 2004 made it difficult  for USAID to hold grantees accountable, because no-penalty causes  were included in the grant agreements. Further, neither USAID nor its  initial contractor developed a quality assurance plan for the school and  clinic reconstruction effort. Such a plan could have guided USAID’s  oversight efforts and assisted in the identification of problems. Similarly,  although the main infrastructure contractor was required to develop and  submit a comprehensive quality control and assurance program for the  Kabul–Kandahar Road construction project, this was not done.  According to a September 2004 USAID Inspector General report, USAID  did not inspect contract quality control laboratories until 21 months  after road construction began. The Regional Office of the Inspector  General also found deficiencies in the contractor’s quality control  program, such as untrained personnel and lack of adherence to testing  standards.
All sectors. Because of staffing constraints and competing priorities,  USAID did not perform annual contractor performance evaluations in  any sector as required by USAID policy directives in 2004 and federal  regulation. The evaluations are intended to document contract quality,  cost control, and timeliness; and inform future award decisions.  According to USAID, five additional contracting staff were hired in early  fiscal 2005 and efforts to conduct evaluations subsequently began. In  addition, according to contract provisions, technical and contracting  officers are to meet quarterly and annually with contractors to discuss  performance and other administrative and technical issues. Although  USAID maintains that staff met frequently with contractors throughout  2004 and conducted in-house reviews of some of the major programs,  most meetings were ad hoc and records of the discussions were not  always formally documented and reported. The absence of such records  makes it difficult to determine the nature and extent of problems with  individual contractors or across multiple contractors’ efforts. Such  records would also facilitate conducting annual contractor performance  evaluations.
section_title: Performance Measurement Problems Plagued Programs
paragraphs: The USAID mission in Kabul did not develop a performance management  plan for 2004. In addition, performance information in several sectors was  lacking, making it difficult to determine the results of USAID assistance.  Finally, because of—among other problems—weaknesses in contractor  reporting and the lack of a performance management system, the  information reported by USAID to decision makers in Washington, D.C., did  not accurately portray the status of each sector or the overall assistance  effort.
USAID directives state that performance management represents the  agency’s commitment to manage programs with greater accountability and  that operating units must prepare a complete performance management  plan to manage the process of assessing and reporting progress toward  strategic objectives. However, since the mission in Kabul was operating  under a wavier that permitted it to use an interim strategy rather than a  more comprehensive strategy, it was also allowed to operate without a  comprehensive performance management plan. Although a performance  management plan was not required, USAID directives state that when an  interim strategy is used, program performance should still be measured— country volatility may require intensive monitoring and measurement of  program implementation. USAID officials stated that although a formal  plan was not prepared, goals, indicators, baselines, and targets were  included in major contracts. However, without a performance management  plan that meets the requirements stipulated in USAID directives, USAID  cannot develop a complete and accurate assessment of the status of its  assistance efforts. The United States has pledged to maintain a long-term  presence in Afghanistan, in part by increasing the number and scope of  USAID contracts. Consequently, the need for a comprehensive plan and for  the greater integration of performance measurement into the work of  contractors will continue to be important in future years. Now that a new  overall, longer-term strategy for USAID’s efforts in Afghanistan is approved,  USAID has stated that the mission in Kabul will develop a performance  management plan that complies with USAID directives.
Further, USAID directives state that performance data collection should be  integrated with implementing contractors’ activities and incorporated into  the contractors’ work plans. USAID did not stipulate the requirement for  contractors to develop sector-specific performance plans in three of the six  major reconstruction contracts. In two of the three contracts where a  requirement was stipulated, little information on what should be included  in the plans was prescribed. We found problems with performance  measures in the following sectors:  Agriculture. The contractor was required to report to USAID on the  status of 14 performance measures. (See app. III, table 6 for a list of the  measures.) However, the contractor did not collect or report  information for most of the measures, making it difficult for USAID to  accurately determine the extent to which the program was achieving  expected results. Efforts were underway in June 2005 to improve  agriculture-related performance measures.
Democracy and governance. In the grant awarded for civic education and  political party building, USAID did not require the implementing  partners to establish specific targets or develop performance  management plans, making it difficult to assess whether the program  was on schedule or achieving intended results.
Economic governance. For most of fiscal year 2004, the contractor did  not develop performance measures, which would have helped USAID  monitor the sector’s results. An Afghan government review of USAID’s  economic governance program stated that the contractor had not  developed a formal process for assessing advisors as required in the  statement of work. Consequently, it was unclear how USAID or the  contractor assessed advisors’ performance, determined whether the  advisors’ knowledge had been transferred to Afghan counterparts (a key  aspect of the program), or monitored the program’s progress. USAID  officials stated that the program’s progress was tracked through weekly  and monthly progress reports. We found that although these reports  provided information on the status of activities, they did not contain  specific performance indicators to determine the impact of the project.  To correct this weakness, the contractor initiated efforts to produce  periodic performance measures in the last quarter of fiscal year 2004.
Health. According to an evaluation of the health sector, the  contractor’s data management system was unable to collate data  from service delivery subgrantees into a comprehensive picture for  the overall service delivery effort, making it difficult for managers  and USAID to judge progress or results.
Owing to these weaknesses and other problems, the performance  measures that the Kabul mission provided to decision makers in  Washington, D.C., did not completely portray the status of each sector or  the overall Accelerating Success initiative. For example, we found that the  reported agriculture sector measures, such as kilometers of canal repaired,  did not provide the information necessary to determine whether the  program was meeting the primary objectives stated in the contract— increasing agricultural productivity and farmers’ incomes. Likewise, the  only two measures where reported for the democracy and governance  sector, the number of courthouses constructed, and the number of judicial  personnel trained. Those measures did not capture the performance of the  diverse activities implemented in this sector. Further, the data reported in  some sectors did not always match contractor reports. For example,  although contractor reports indicted that 77 schools were refurbished and  8 were substantially complete, reports provided to Washington indicated  that only 39 schools had been constructed or rehabilitated.
Program managers need accurate operational information, including  performance measures, to determine whether strategic objectives are  being met. According to USAID officials in Washington, D.C., only 3 days  were allowed for the development of the Accelerating Success  performance measures. The measures were selected based on what USAID  thought it could accomplish by the June 2004 target date rather than what  was needed to determine progress and results in each sector. USAID  conditioned meeting the targets on, among other things, the existence of a  secure environment and the receipt of funding by July 2003. Neither of  these conditions existed. USAID does not believe that the performance  measures currently used are an effective way of measuring progress  toward program objectives and plans to introduce more meaningful  performance measures in fiscal 2006. The agency maintains that it is crucial  to take into account lessons learned related to the difficulty of the  reconstruction environment when developing future measures. (App. III  presents information on the performance measures that were included in  the main contracts for each sector and the Accelerating Success  performance measures provided to decision makers in Washington, D.C.)
section_title: Lack of Staff and Security Restrictions Impeded Effective On-Site Project Monitoring
paragraphs: Throughout fiscal year 2004, staffing problems and security restrictions  limited on-site project monitoring. Although the USAID mission in Kabul  had more staff and better working conditions by late fiscal year 2004 than  in previous years, staff levels and turnover continued to pose a challenge.  Staff at the USAID mission in Kabul continued to manage a much larger  amount of assistance than their counterparts at other missions.  Specifically, as of June 2004, staff at the mission in Kabul managed  approximately $27.5 million in assistance per staff member while  counterparts at other missions managed $1.2 million per staff member. This  ratio improved by September 2004 after USAID increased its staff from 41  to 101. In September, the ratio was reduced to about $11.2 million per staff  person while the average across USAID missions remained about $1.2  million per staff person. Further, staff turnover in key positions continued  in 2004. For example, the mission had three different directors in fiscal year  2004. Similarly, the agriculture sector had five different technical officers in  2004, owing to staff performance problems and delays in finding a  permanent officer. According to USAID, the mission in Kabul also did not  have sufficient staff in Afghanistan with the technical knowledge to  monitor reconstruction projects. To increase technical knowledge, 10  members of the U.S. Army Corps of Engineers were assigned to the Kabul  mission by September 2004. To increase the recruitment pool for staff  assigned to the USAID mission, in November 2004, USAID’s Administrator  requested all staff to consider serving in one of four critical posts including  Afghanistan, Iraq, Pakistan, and Sudan. In addition, in order to attract and  retain more U.S. direct hire staff for extended periods, USAID has  increased pay incentives, such as hazard pay, cost of living, and overtime  remuneration.
Security restrictions limited the travel of U.S. direct-hire personnel to  program sites outside Kabul, making routine program monitoring difficult.  In its April 2004 risk assessment of the USAID mission in Kabul, USAID’s  Inspector General cited the inability to travel freely to project sites because  of security concerns as a material weakness and an overriding constraint to  managing assistance activities in Afghanistan. For much of fiscal year 2004,  USAID staff had limited access to project sites and depended on reporting  from its contractors and grantees. To improve project monitoring, USAID  contracted with a nongovernmental organization to conduct site  evaluations; however, the contract was not signed until May 2004.
section_title: Efforts to Improve Coordination of U.S. Activities and International Assistance Had Varying Results
paragraphs: Although coordination of U.S. assistance efforts occurred daily throughout  fiscal year 2004, new initiatives to improve coordination of U.S. assistance  in Afghanistan had mixed results. Also, despite efforts by the Afghan  government to better coordinate international donor assistance, problems  associated with the effectiveness of coordination mechanisms persisted in  2004.
subsections: section_title: U.S. Efforts Were Coordinated through Interagency Process, but Initiatives to Improve Coordination Had Mixed Success
paragraphs: U.S. assistance to Afghanistan in fiscal year 2004 was coordinated primarily  through daily meetings of the Afghanistan Interagency Operations Group.  The group included representatives from the Department of State’s Office  for Afghanistan, USAID, DOD, and other agencies delivering assistance.  According to Department of State officials, this formal, interagency  committee provided a uniform process for making, and informing the  President of, policy-level decisions and for sharing information among  agencies. In Afghanistan, U.S. assistance was coordinated through the U.S.  Embassy country team. (See fig. 14.)
The United States undertook several initiatives in fiscal year 2004 to  improve coordination of U.S. assistance in Afghanistan. Specifically, the  office of the Commander of the Combined Forces Command-Afghanistan  (CFC-A) was moved to the embassy from Bagram Airbase (27 miles north  of Kabul) to improve coordination between civilian and military efforts in  Afghanistan. Further, according to embassy officials we interviewed and  documents we reviewed, the Ambassador did not believe that the existing  embassy management structure was sufficient to plan, coordinate, and  monitor U.S. operations and did not have confidence in the accuracy of  reconstruction assistance reporting. To improve reconstruction  management, planning, and reporting, the ambassador created the  Embassy Interagency Planning Group, staffed by military officers, to  improve reporting on reconstruction projects, facilitate the development  and execution of the Mission Performance Plan, and act as a liaison  between the embassy, CFC-A, the Afghanistan Interagency Operations  Group, and others.
The Departments of State and Defense also created the Afghanistan  Reconstruction Group (ARG) in fiscal year 2004, recruiting private sector  and other experts to serve as strategists to the Ambassador and as sector  advisors to key Afghan government ministries. However, the group’s  mandate, mission, roles, and responsibilities were not delineated or  incorporated into the embassy’s Mission Performance Plan. In addition,  according to ARG, USAID, and Department of State officials, the ARG  focused its efforts on criticizing USAID programs rather than providing  constructive advice. As a result, animosity developed between the ARG  advisors and some USAID and embassy staff. According to USAID and  Department of State officials we spoke to, some ARG advisors did not  coordinate Afghan ministry meetings with embassy staff or inform them  about the meetings’ results. State and USAID officials stated that because  separate meetings were being held, Afghan government ministries  sometimes received conflicting messages about U.S. reconstruction  activities. Further, some USAID contractors became confused by ARG  advisors’ efforts to direct the reconstruction effort. For example, ARG  advisors responsible for economic governance issues tried to direct the  activities of USAID’s contractor for that sector. To clarify lines of authority,  USAID informed its contractors that they were to take direction from  USAID alone. Most U.S. officials we spoke to in November 2004 stated that  coordination with the ARG had improved; however, the roles and  responsibilities of the ARG remained unclear.
To enhance reconstruction efforts, the U.S. government increased the  presence in the PRTs of civilian personnel from the Department of State,  USAID, and other agencies. By September 2004, about 13 Department of  State, 8 USDA, and 13 USAID representatives were stationed alongside U.S.  military personnel in PRTs across Afghanistan. However, in the absence  of a common doctrine or set of best practices for incorporating civilian  personnel, coordination varied depending on each PRT commander’s  priorities and personal relationships with civilian agency representatives.  In addition, we found that stationing civilian personnel in the PRTs did not  improve oversight of Kabul-based projects. In general, USAID personnel at  the PRTs focused on identifying, implementing, and coordinating PRT- based, quick-impact projects. Few USAID technical officers stationed in  Kabul used the USAID PRT staff to help monitor reconstruction projects.  We reported that in fiscal year 2003, neither USAID officers stationed in  Kabul nor at PRTs were able to identify the location of many Kabul-directed  projects in the field. This problem persisted in 2004 despite the addition of  a Kabul-based USAID-PRT coordinator to facilitate logistics and  communication.
section_title: Coordination Problems between Afghan Government and Donors Persisted
paragraphs: Despite some efforts by the Afghan government to coordinate assistance  from international donors, problems associated with the effectiveness of  coordination mechanisms persisted throughout 2004. The Afghan  government established the National Development Framework and Budget  and consultative groups to coordinate international assistance. The  development framework and budget established broad national goals and  policy direction for a reconstructed Afghanistan. The consultative groups  were designed to assist in the planning and implementation of the national  budget and to coordinate the international community’s independent  efforts and political objectives. (See fig. 15.)
Afghanistan Development Forum (ADF) (National Budget)
Consultative Group Standing Committee (CGSC)
In June 2004, we reported that the coordination of international assistance  and the consultative groups had not been effective. We found, among  other things, that some donors independently pursued development efforts  in Afghanistan; the international community asserted that the Afghan  government lacked the capacity and resources to effectively assume the  role of coordinator; the terms of reference for the consultative groups were  unclear and too broad; the groups were too large and lacked strong  leadership; member commitment was uneven; and the overall potential of  the mechanism had not been maximized.
International coordination improved somewhat in 2004. The national  Consultative Group Standing Committee met frequently; the Afghan  government presented a consolidated national budget to focus  international donations at the Afghanistan Development Forum; and more  donors demonstrated increasing commitment to use the national budget to  focus their assistance. However, the then Minister of Finance stated that  some international donors continue to provide assistance based on what  they want to provide rather than on the Afghan government’s needs.
However, problems with the consultative groups and USAID’s coordination  with the Afghan government persisted in fiscal 2004. According to the then  Minister of Finance, the consultative group mechanism had not matured  into a real decision-making forum. More than 1 year after their creation,  most groups met infrequently and 5 of the 16 groups had not yet developed  terms of reference to guide their efforts. Others that did not produce  results, such as the natural resources consultative group, were effectively  disbanded. Although USAID participated in a number of the consultative  groups, some coordination issues remained. For example, according to  USAID officials there were extensive contacts between USAID,  contractors, and ministry officials, and ministries had to approve building  designs and site locations. However, officials from the Ministries of  Education and Health believed they had been excluded from participating  in the management of the construction of schools and clinics. Further, the  lack of coordination among the Ministry of Health, USAID, and the REACH  contractor to match clinic construction site selection with the location of  health service delivery grant activities caused a significant barrier to  expanding the basic provision of health services. The Minister of  Agriculture stated that he was not regularly informed about the U.S.  agriculture program’s progress and was unable to respond to public  inquiries about the program, increasing skepticism as to whether any  assistance was being delivered. Similarly, according to an evaluation  commissioned by the Afghan government, the Minister of Finance and his  department heads had little input into the initial identification and selection of some of the USAID contracted advisors and were dissatisfied with their  qualifications and work.
section_title: Lack of Security, Opium Cultivation, and Funding Delays Obstructed Reconstruction and Threatened Achievement of U.S. Goals
paragraphs: In fiscal year 2004 Afghanistan’s security situation remained volatile and, in  some parts of the country, seriously deteriorated. Attacks on assistance  projects occurred throughout the year, resulting in project delays and the  deaths of assistance workers. In addition, dramatic increases in opium  cultivation continued to threaten stability in Afghanistan; efforts to reverse  the trend, including the development and implementation of a U.S.  counternarcotics strategy, began in late 2004. Further, delayed funding  continued to hamper the U.S. assistance effort in Afghanistan. Most of the  funding needed to meet June 2004 Accelerating Success initiative targets  was not available until February, just 5 months prior to the target date.
subsections: section_title: Deteriorating Security Delayed Project Implementation, Fueled Instability
paragraphs: In fiscal year 2004 the security situation in Afghanistan was volatile and  deteriorated in some regions. Attacks against aid workers, Afghan security  forces, and international forces increased. According to U.S. security data  and UN reports in August and November 2004, deteriorating security in the  south and southeast caused large areas to be “effectively out of bounds to  the assistance community” (see fig. 16). In the north—an area commonly  viewed as the safest in the country—attacks resulted in the deaths of  foreigners and Afghans. Direct attacks on UN compounds and convoys  occurred in Kandahar, Konduz, and Hirat provinces as well as other  provinces.
According to USAID, eighty-one people involved in assistance activities  were killed in 2004. During fiscal year 2004, 70 attacks directly affected  USAID programs, causing delays in reconstruction projects. For example,  equipment was damaged, work was delayed, and construction workers  were kidnapped, wounded, or killed by antigovernment forces attacking  USAID’s highway construction project. In addition, secondary road  projects, agricultural training programs, the distribution of vaccines and  medicines, and the construction of schools and clinics, among other  reconstruction projects, were delayed or terminated because of attacks.  For example, school construction in Uruzgan, Helmand, Paktiya, and  Ghazni provinces was at a standstill owing to security threats.
Stability across the country in 2004 was threatened by local authorities and  military commanders who acted with impunity and were viewed as  responsible for a wide range of repressive activities, including acts of  intimidation, extortion, arbitrary arrest, illegal detentions, and extrajudicial  killings and torture, according to the Department of State, the UN, and  human rights groups. Factional fighting among warlords in seven provinces  in the north and the west of Afghanistan continued in 2004, resulting in the  deaths of at least 100 combatants and civilians. Although large areas of the  country and some warlords remained beyond the control of the Afghan  government in 2004, the Afghan government made some progress in  asserting its authority. For example, the Afghan President appointed new  governors in about half of the country’s 34 provinces. However, according  to the Department of State’s 2004 human rights report for Afghanistan, the  government or its agents carried out extrajudicial killings. For example,  on August 14, 2004, 17 bodies were discovered at the Shindand market  place, with evidence that 6 of the 17 individuals were tortured and  beheaded.
The United States and the international community continued to take steps  to improve security in Afghanistan. Specifically, DOD, coalition, and NATO  forces increased the number of provincial reconstruction teams from 4 to  19 in 2003-2004 to enhance security for reconstruction activities. In  addition, DOD accelerated its effort to train and deploy Afghan National  Army combat troops. As of March 2005, 18,300 troops had been trained and  10,500 troops had been deployed to Kabul central command and 7,800 to  four regional commands. However, efforts to equip troops and build  supporting military organizations were behind schedule. Further, the  United States and Germany had trained more than 35,000 police by January  2005, but the lack of infrastructure and equipment at the provincial and  district levels, along with other problems, negatively affected police  effectiveness. Finally, as of February 2005, about 40,000 of Afghanistan’s  estimated 100,000 official militia forces had been demobilized; however,  an estimated 65,000 to 80,000 unofficial militia fighters were still at large.  The Department of State views the demobilization and reintegration of  these forces as critical to improving the country’s security and succeeding  in the international recovery effort.
subsections: section_title: Dramatic Increase in Opium Cultivation Threatens Stability
paragraphs: In 2004, dramatic increases in opium cultivation continued to threaten  stability, reconstruction, and state-building in Afghanistan. According to  the UN, Afghan drug production increased by approximately 25 percent  between 2002 and 2004, owing to high returns, a growing market, rural  poverty, political fragmentation, weak law enforcement, and deteriorating  security. (See app. IV for 2002-2004 production and revenue statistics.)  The UN estimated 2004 opium production at 4,200 metric tons, which  represents almost 90 percent of the world’s illicit opium supply. Disease  and drought kept the yield low; without these mitigating environmental  factors, the U.S. government estimated that total production would have  been more than 9,700 metric tons.
According to the Department of State, the UN, the Afghan government, and  others, opium cultivation, drug trafficking, and associated financial gains  are having an increasingly harmful influence on Afghanistan society.  Specifically, some national level officials and many district and provincial  government leaders have some criminal connection to the opium trade.  With opium-related revenues equivalent to 50 to 60 percent of its GDP over the past 3 years, Afghanistan is on the verge of becoming a narco-state.  The increase in opium production and trafficking is threatening  reconstruction and state-building in Afghanistan, as well as the nation’s  longer-term peace. It is undermining legitimate economic activities and the  establishment of the rule of law and is responsible for supporting factional  agendas and antigovernment elements, including warlords, local  commanders, and terrorist organizations. The drug trade is also impeding  the disarmament, demobilization, and reintegration of former combatants,  because those involved in the drug economy are developing and funding  private militias needed to run the drug business. Further, the unchecked  development of an illicit narcotics-based economy, and the funds it  provides to the entrenched interests of antigovernment elements in the  provinces, exacerbates problems associated with the central government’s  effort to extend its writ outside Kabul.
The Afghan government and the international community have taken a  number of actions to address the narcotics problem in Afghanistan since  the signing of the Bonn Agreement in December 2001. These actions have  included imposing bans on opium cultivation, drafting counternarcotics  strategies, establishing Afghan counternarcotics police organizations, and  launching limited eradication efforts (see app. IV for more details). U.S.  counternarcotics efforts in 2004 were led by the Department of State’s  Bureau for International Narcotics and Law Enforcement (INL) Affairs.  Additional assistance was provided by DOD. INL obligated $36.5 million  primarily to eradicate poppies and provide alternative livelihoods and  spent about $8.9 million, to assist the Afghan Government’s central  eradication force. DOD obligated $25.7 million on counternarcotics efforts  by October 2004 and spent about $8.9 million, to train and equip the Afghan  Government Counternarcotics Police, build a public affairs capacity within  the Ministry of Interior, and create a counternarcotics intelligence  organization.
However, these and other counternarcotics efforts failed to have any  significant impact on the cultivation and processing of opium in 2004 owing  to limited security and stability across Afghanistan. For example, as of  October 2004, efforts led by the Afghan, UK, and U.S. governments to  manually eradicate poppy fields failed. In 2004, eradication efforts began  after most of the country’s opium had been harvested, primarily targeted  producers in only 1 of 34 provinces, and resulted in the eradication of less  than 1 percent of the hectares cultivated. Meanwhile, although a number of  clandestine processing labs were destroyed and limited quantities of  opiates seized, no major narcotics traffickers were arrested, and piecemeal  training and limited funding have impeded the development of  Afghanistan’s Counternarcotics Police.
According to the Department of State, counternarcotics is now one of the  top U.S. priorities. Between June and October 2004, a $776.5 million, five- pillar strategy, implementation plan, and budget for 2005 were developed.  The budget would fund five areas: $299 million for eradication programs,  $180 million for law enforcement, $172.5 million for interdiction, $120  million to provide legal livelihood alternatives for poppy farmers, and $5  million for a public information campaign.
The 2005 strategy faces a number of challenges that may limit its success.
The strategy calls for a robust eradication program that includes the use  of aerial methods. However, the Afghan government vetoed the use of  aerial eradication, making it impossible to affect large areas quickly.
During our visit in October 2004, the Governor of the Afghan National  Bank stated that eradicating 30 to 50 percent of the country’s opium  would have a destabilizing impact on the economy. He added that the  U.S. government had not consulted the National Bank regarding the  economic impact of eradication.
U.S. officials stated that funding for the overall U.S.-led effort was  needed in January 2005, 4 months before the beginning of the harvest  season, but some of the funding was not available until May 2005.
The interdiction capabilities of the Afghan government are rudimentary  at best, because the government lacks the laws or legal infrastructure  needed to investigate and prosecute drug-related crimes.
section_title: Delayed Funding Negatively Impacted Acceleration Efforts
paragraphs: Delayed funding continued to negatively impact the U.S. assistance effort  in Afghanistan in fiscal year 2004. In our previous report, we noted that  delays in fiscal year 2003 funding prevented USAID, in particular, from  undertaking major reconstruction activities. As in prior years, most  reconstruction money in fiscal year 2004 was provided through emergency  supplemental appropriations, with smaller amounts in the agencies’ regular  appropriations. USAID received reconstruction money through two  appropriations (see fig. 17). In November 2003, Congress appropriated $672  million in emergency supplemental legislation; the Office of Management  and Budget (OMB) apportioned $270 million of this funding to USAID in  late January 2004 and $372 million in early February. In addition, Congress  appropriated $283 million in January 2004 for USAID’s fiscal year 2004  budget for Afghanistan reconstruction. However, the first portion of these  funds did not become available for programming by the USAID mission in  Kabul until March 2004 owing to delays introduced by the apportionment  processes within State, OMB, and USAID. All of these funds were for  programs that, under the Accelerating Success initiative, had initial targets  of June 2004, giving the agency approximately 3 to 6 months to  demonstrate progress. According to USAID officials, to compensate for  the funding delays USAID was forced to postpone the start or expansion of  programs and move funds between programs to keep faster paced  programs operating.
USAID continues to face funding delays in fiscal year 2005. In December  2004, Congress passed regular appropriations for the agency, matching  USAID’s Afghanistan budget request of $397 million; USAID officials stated  at the time that they would be unable to fully implement programs with the  amount of their regular appropriations and would rely on supplemental  funding to carry out the agency’s planned activities. However, the almost  $1.1 billion fiscal 2005 emergency supplemental appropriation was not  passed until May 2005. USAID, Department of State, and Afghan officials  told us that it is difficult to plan and implement large development  programs that depend heavily on the passage of uncertain supplemental  appropriations.
section_title: Conclusions
paragraphs: Afghanistan has made progress since the fall of the Taliban in October  2001. As part of an international effort, U.S. assistance, led by USAID,  helped Afghanistan elect its first president, return millions of children to  school, and repatriate millions of refugees. Despite these gains,  Afghanistan’s needs remain great. It ranks as the world’s fifth poorest  country; half of all Afghans live below the poverty line and more than 20  percent cannot meet their daily food requirements. Further, factional  elements remain in control of some areas of the country, perpetrating  crimes against citizens, and insurgents continue to infiltrate the country.  These conditions leave the nation at risk of once again becoming a threat to  itself and others.
The U.S. has pledged to maintain a long-term presence in Afghanistan,  including increasing the number and scope of USAID contracts. In 2004, the  focus of U.S. support to Afghanistan shifted from primarily emergency  assistance to reconstruction programs, with large scopes of work and  costs, in an effort to accelerate progress. Despite its considerable  investment in Afghanistan’s reconstruction, USAID struggled with contract  management and project oversight. Although a long-term, country-level  strategy was approved as of July 2005, USAID operated throughout 2004  without a comprehensive strategy. In addition, USAID has not developed a  performance management plan to monitor project performance, nor has it  focused contractors’ efforts on developing project-specific performance  plans. Without such plans, the U.S. government cannot accurately assess  the results of its assistance efforts. Consequently, decision makers in  Washington and Kabul cannot effectively target resources to accomplish  the goal of creating a stable Afghan society.
section_title: Recommendations for Executive Action
paragraphs: To improve on existing efforts to measure and assess the progress of U.S.  reconstruction projects toward achieving U.S. policy goals, and to provide  a basis for planning future reconstruction projects, we recommend that the  Administrator of USAID take the following three actions (1) establish a  performance management plan that complies with USAID directives, (2)  clearly stipulate in all future reconstruction contracts that contractors are  to develop performance management plans specific to the work they are  conducting, and (3) more completely communicate the performance  information obtained from the performance management plans to  executive branch decision makers in Kabul and Washington.
section_title: Agency Comments and Our Evaluation
paragraphs: We provided a draft of this report to the Departments of State and Defense  and to USAID to obtain their comments. The Departments of State and  Defense declined to comment on the report. USAID commented that in  general it found the report to be a comprehensive and detailed assessment  of the U.S. civilian reconstruction efforts in Afghanistan during fiscal year  2004. USAID concurred with the report’s recommendations and indicated  that it has made progress in improving its strategic planning and  performance measurement processes. Specifically, USAID completed its  first long-term country-level strategy for Afghanistan to cover the period  from 2005 through 2010. The agency also indicated that it has begun  developing a performance management plan. USAID also provided  information on more recent activities and technical comments, which we  incorporated where appropriate.
Copies of this report are being sent to the Secretary of Defense, the  Secretary of State, the Administrator of USAID, relevant congressional  committees, and other interested parties. We will also make copies  available to others upon request. In addition, the report will be made  available at no charge on GAO’s Web site at http://www.gao.gov.
If you or your staff have any questions about this report, please contact me  on (202) 512-3149 or at gootnickd@gao.gov. Contact points for our Offices  of Congressional Relations and Public Affairs may be found on the last  page of this report. Other contacts and major contributors are listed in  appendix V.
section_title: Objectives, Scope, and Methodology
paragraphs: The Afghanistan Freedom Support Act of 2002 directs GAO to monitor U.S.  humanitarian and reconstruction assistance to Afghanistan. To meet the  requirements of the directive and provide Congress with a comprehensive  accounting of U.S. assistance to Afghanistan for the fiscal year 2004 period,  we analyzed (1) U.S. obligations and expenditures, (2) the progress and  results of U.S. humanitarian and reconstruction efforts, (3) the  management of U.S. assistance and mechanisms to coordinate U.S. and  international assistance, and (4) the major factors that obstructed the  advancement of the assistance effort and the achievement of U.S. policy  goals.
We collected data on fiscal year 2004 obligations and expenditures from the  U.S. departments and agencies responsible for implementing U.S.  government–funded projects in Afghanistan. These include the U.S.  Departments of Agriculture, Defense, Health and Human Services, Labor,  State, and Treasury; the Broadcasting Board of Governors; the U.S. Trade  and Development Agency; and the U.S. Agency for International  Development (USAID). Because no single repository contains financial  information for all U.S. assistance in Afghanistan, we contacted each  agency directly. For the Department of State, we contacted each bureau  and office separately—the Bureau of Population, Refugees, and Migration;  the Bureau for International Narcotics and Law Enforcement Affairs; the  Office of Humanitarian Demining Programs; and the Office to Monitor and  Combat Trafficking In Persons—because the Department of State does not  have a consolidated financial reporting mechanism for programs in  Afghanistan that tracks both obligations and expenditures.
To distinguish funding for humanitarian and quick-impact projects from  longer-term reconstruction funding, we requested the agencies to designate  their funding appropriately. For USAID, we generally relied on the stated  mission of the responsible funding bureau to determine the funds’ purpose  unless the agency informed us otherwise. For example, we assumed that  funding for the Office of Foreign Disaster Assistance and the Office of  Transition Initiatives was generally used, in accordance with their  respective missions, to address emergency situations and implement quick- impact projects; funds for the offices’ various long-term projects were  clearly marked in the financial reporting that USAID supplied to us.
To delineate the distribution of funding and projects by province, we report  information that USAID provided from a programmatic, rather than a  financial, database. The financial database did not include data by location,  and the programmatic database included only province-level obligation  data. Because data on nationwide programs were not included in the  programmatic database, we were unable to compare overall totals between  the financial and programmatic databases to verify consistency. Also,  because the programmatic database tracks only obligations, we were  unable to determine USAID’s expenditures by province.
To assess the reliability of the obligations and expenditures data from U.S.  agencies providing assistance to Afghanistan, we (1) interviewed officials  at the Department of Defense (DOD), the Department of State, and the U.S.  Agency for International Development (USAID) regarding their methods of  gathering, management, and use of data; (2) reviewed USAID’s financial  audit statement; and (3) compared the data we gathered with USAID’s  Congressional Budget Justifications and State’s 150 account  documentation, as well as with the governmentwide Afghanistan  assistance compiled by State’s Bureau of Resource Management.  According to a Department of State official, the data compiled by the  agency’s Bureau of Resource Management are not complete, owing in part  to differences in how the agencies track data, a disconnect between  agencies’ Washington and Kabul offices, and variation in the frequency of  reporting. However, the Department of State relies on these data for  decision-making purposes and to report to Congress. Based on our  assessment, we concluded that the data on obligations and expenditures  we collected from each agency are sufficiently reliable for the purpose of  showing, in gross numbers, the levels of U.S. nonsecurity-related assistance  to Afghanistan in fiscal year 2004.
To assess the reliability of data for pledges by international donors, we (1)  interviewed the Department of State official responsible for compiling  these data based on information provided by the government of  Afghanistan and (2) compared the data’s reliability with that of other  information sources. We determined that the data are sufficiently reliable  for the purpose of broadly comparing the United States’ contributions with  those of other major donors and the combined total for all other donors.  However, we noted several limitations in the data, notably, that they are  self-reported by donor nations to the Afghan government. Furthermore, the  data for larger donors are considered more reliable than the data for  smaller donors, according to the Department of State. Owing to these  limitations and our lack of access to donor nations’ financial records, we  were unable to determine the reliability of the dollar amounts reported to  have been pledged by each donor. Nevertheless, we present the reported  pledges in appendix II for the purpose of broadly comparing the U.S.  contributions with those of other major donors.
To examine the results of assistance projects through September 30, 2004,  we focused our efforts on the major USAID reconstruction contracts  signed prior to the start of fiscal year 2004. The contracts account for  approximately 85 percent of the U.S.’ reconstruction expenditures for the  fiscal year. We collected and analyzed information from the Departments of  State and Defense, and USAID in Washington, D.C., outlining policy goals,  basic strategies, program objectives, and monitoring efforts. We reviewed  the periodic progress reports provided by both USAID and its  implementing partners for all the major reconstruction projects. To assess  the reliability of these reports, we contacted each of USAID’s cognizant  technical officers in Kabul about the reliability of the information provided  in the implementing partners’ reports. While they noted that security  restrictions and the large territory in Afghanistan make monitoring  difficult, all of the cognizant technical officers we contacted consider the  data to be generally reliable for the purposes of providing an overall status  of the projects. In October 2004, we traveled to Afghanistan to examine the  implementation of USAID and Defense’s assistance-related operations.  While in Afghanistan, we spent 12 days in the capital city, Kabul,  interviewing officials from the Afghan Ministries of Finance, Health, and  Agriculture; the Central Bank; the U.S. Departments of State and Defense;  and USAID. We also met with most of USAID’s primary implementing  partners (including the International Organization for Migration, the Louis  Berger Group, Inc., Creative Associates International Inc., Chemonics,  Bearing Point, the International Republican Institute, the International  Foundation for Election Systems, Management Sciences for Health,  Management Systems International, Population Services International,  Technologists Incorporated, and the Asia Foundation). In addition, we met  with the officials from the British Embassy in Kabul responsible for  counternarcotics initiatives. In Kabul, we inspected the rehabilitation of the  Rabia Balkhi Women’s hospital. We also spent 8 days in the Ghazni, Hirat,  Kunduz, and Nangahar provinces, where we reviewed U.S.- funded  projects, implemented primarily by USAID’s Office of Transition Initiatives,  USAID’s PRT-based staff, or Defense’s PRTs. While in these provinces, we  met with provincial governors, district leaders, teachers, healthcare  workers, and other community members involved in, or affected by, U.S.  reconstruction projects. Constraints placed on our movement within  Afghanistan by the U.S. Embassy due to security concerns limited the  number of project sites we could visit.
To analyze the assistance coordination mechanisms developed by the U.S.  government and the international community we met with State  Department of State staff responsible for assistance coordination. We also  met with and staff from USAID, and the Departments of Agriculture,  Commerce, Defense, U.S. Trade and Development Agency, and Treasury  who were involved in the provision of assistance, to obtain their views on  the coordination of assistance. In addition, we reviewed the U.S. National  Security Strategy; the State-USAID consolidated strategic plan for fiscal  years 2004-2009; the President’s Security Strategy for Afghanistan; the U.S.  Embassy–Kabul Mission Program Plan; and USAID’s strategy and action  plan for Afghanistan. Our analysis of international coordination  mechanisms included a review of United Nations (UN) and Afghan  government documents, including the Afghan National Development  Framework and Budget, pertaining to the international coordination  mechanisms utilized in Afghanistan in fiscal year 2004. In addition, we met  with officials from the Afghan Ministries of Agriculture, Finance, and  Health, and from the Central Bank to obtain their views on the evolution  and status of the consultative group mechanism.
To analyze the obstacles that affected the implementation of U.S.  reconstruction assistance we reviewed reports produced by the  Departments of State and Defense, USAID, the UN, the International Crisis  Group, and the Afghanistan Research and Evaluation Unit. To assess the  reliability of the UN data on opium production we reviewed the  methodology used by the UN to estimate levels of opium poppy cultivation  and opium production. We determine that the UN data is sufficiently  reliable for the purpose of this report. Finally, we discussed the obstacles  and their impact with officials from the Afghan ministries of Agriculture,  Finance, and Health; the Afghan Central Bank; the Afghan  Counternarcotics Directorate; USAID; and the Department of State.
We conducted our review from August 2004 to May 2005 in accordance  with generally accepted government auditing standards.
section_title: Sector Level Performance Indicators
paragraphs: The Accelerating Success initiative performance measures reported to the  Afghanistan Interagency Operations Group in Fiscal 2004 were initially  developed by USAID during a 3-day period in June 2003. The measures  were modified during that fiscal year with input from other agencies and  represent a subset of the measures reported for each of the major  reconstruction contracts. The development of performance measures for  each major contract varied. In some sectors, such as agriculture,  performance measures were included in the contract. In other sectors,  such as health, the measures were developed in a performance  management plan developed by the contractor after the contract was  awarded or, as in the economic sector, developed late in the project and  published in periodic progress reports. The tables below describe the  Accelerating Success performance measures reported by the Afghanistan  Interagency Operations Group and the more detailed measures developed  by individual contractors for the major reconstruction contracts.
The RAMP contract contains 14 performance measures (see table 6),  including program outputs such as the implementation of 615 irrigation  projects and project outcomes such as increasing the average productivity  of approximately 500,000 farm families by more than 100 percent. However,  the contractor did not have systems in place to capture information for all  measures.
Of three primary awards for democracy and governance activities, USAID  required only one implementing partner MSI, to develop a performance  monitoring plan containing performance measures (see table 8). The other  two partners, The Consortium for Elections and Political Process  Strengthening and the Asia Foundation, were required to produce quarterly  reports but were not required to develop specific targets or intermediate  results. Consequently, the quarterly reports described activities undertaken  during that time period, rather than progress achieved against specified  targets.
The economic governance contract did not specifically require the  contractor to develop performance measures. Instead, it required the  reporting of “milestones” in quarterly work plans. No quarterly plans were  produced until July 2004; consequently, no measures were reported until  that time. (See table 10.)
USAID required the health contractor, Management Sciences for Health  (MSH), to develop implementation plans and performance monitoring  plans. MSH reports on selected performance indicators in these plans  semiannually. (See Table 14)
The reported measures also provide detailed narrative about progress on  primary and secondary road projects and ongoing power-generation  projects. Irrigation projects are tracked as part of the agriculture sector,  and school and clinic construction and renovation are tracked as parts of  the education and health sectors, respectively. The measures do not track  water and sanitation projects. See table 16 below.
The Afghanistan Freedom Support Act of 2002 and the 2004 Emergency  Supplemental legislated assistance to Afghan women. USAID implemented  and tracked most of these objectives either as part of their other sector  programs or through individual women-targeted projects (see table 17.)  However, no gender-specific performance measures of sector programs nor  the results of individual women-targeted projects were reported to the  Afghanistan Interagency Operations Group.
section_title: Comments from the U.S. Agency for International Development
section_title: GAO Contacts and Staff Acknowledgements
subsections: section_title: GAO Contacts
section_title: Staff Acknowledgments
paragraphs: John Hutton, David Bruno, Miriam A. Carroll, and Christina Werth made  key contributions to this report. In addition, Martin de Alteriis, Mark  Dowling, Etana Finkler, Reid Lowe and Adam Vodraska provided technical  assistance.