Without better planning, in 2015 the lights will go out in Kandahar

Insulators at the Northwest Kabul Breshna Sub Station, one of the largest power suppliers to Afghanistan’s capital. Kandahar could lose its power supply if the “growing fiscal gap” in the country is not addressed. Photo by: Graham Crouch / World Bank / CC BY-NC-ND

The drawdown of foreign military forces does not mean the U.S. is going to stop spending huge amounts of money in Afghanistan anytime soon, a government watchdog reminded taxpayers and policy experts on Wednesday.

While the troops from the NATO-led International Security Assistance Force are pulling out of the country in droves, and many NGOs are scaling back their operations due to security concerns in many areas, the U.S. Congress has already appropriated $18 billion that has yet to be spent for reconstruction projects in Afghanistan, and Washington will likely commit $6-10 billion annually “for years to come,” John Sopko, U.S. Special Inspector General for Afghanistan Reconstruction, said in a speech at the Middle East Institute.

The United States has committed a total of $103 billion since the reconstruction effort began. While this amount is “noteworthy” in terms of spending, it is “staggering” when compared to the Afghan government’s own budget and revenue for spending on services, according to Sopko. SIGAR estimates that the in 2013 Kabul was able to raise nearly $2 billion, and the country’s current budget is roughly $7.6 billion.

“Without donor contributions, the Afghan government will not be able to meet most of this shortfall, which will have serious consequences,” he said.

But Sopko’s concerns about Afghanistan’s impending budget deficit is hardly an endorsement of unfettered aid spending. The SIGAR chief actually believes that the flood of funding for reconstruction and development projects has contributed to Afghanistan’s “growing fiscal gap.”

“Each new development project that the U.S. and other international donors fund increases overall operation and maintenance costs, adding pressure to Afghanistan’s operating budget,” he explained, citing U.S. support for Afghanistan’s energy sector, which some fear has raised expectations about power availability, with no long-term plan for ensuring that for instance Kandahar, the country’s second-largest city, can keep the lights on after the U.S. government stops paying for diesel generators to run.

“Unless the U.S. government or other international donors keep subsidizing fuel for the generators, starting in 2015, thousands of homes and businesses in Kandahar will no longer have power,” Sopko said.

Many Afghans already doubt the government’s capacity to deliver services and utilities, and are skeptical of paying taxes for public services that have rarely existed in war-torn provinces and cities. Their confidence is hardly restored by reports of rampant corruption and money laundering that lead Afghanistan to rank among the most corrupt countries in the world, and threaten to land them on the Financial Action Task Force’s “black list” if sufficient steps are not taken to overcome money laundering problems.

“It will likely be many years until Afghanistan can generate enough revenue to support the kind of government and security forces the United States and its allies have helped it build over the last twelve years,” Sopko said.

Read more on U.S. aid reform online, and subscribe to The Development Newswire to receive top international development headlines from the world’s leading donors, news sources and opinion leaders — emailed to you FREE every business day.

See more:

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Afghanistan risks 'blacklisting' over financial corruption — SIGAR
Afghanistan post-2014: Humanitarian relief or long-term development?
How USAID 'pushed back' to quell Afghanistan oversight fears
SIGAR chief to US contractors: Share information (before it’s too late)
SIGAR looks into 10 years of US aid to Afghanistan
US watchdog asks NGOs for tips to improve Afghan aid

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  • Igoe michael 1

    Michael Igoe

    Michael Igoe is a Senior Reporter with Devex, based in Washington, D.C. He covers U.S. foreign aid, global health, climate change, and development finance. Prior to joining Devex, Michael researched water management and climate change adaptation in post-Soviet Central Asia, where he also wrote for EurasiaNet. Michael earned his bachelor's degree from Bowdoin College, where he majored in Russian, and his master’s degree from the University of Montana, where he studied international conservation and development.