    Foreign Assistance: Lack of Strategic Focus and Obstacles to
    Agricultural Recovery Threaten Afghanistan's Stability
    (30-JUN-03, GAO-03-607).

    After the events of September 11, 2001 led to the defeat of the
    Taliban, the United States and the international community
    developed an assistance program to support Afghanistan's new
    government and its people. Key components of this effort include
    food and agricultural assistance. GAO was asked to assess (1) the
    impact, management, and support of food assistance to Afghanistan
    and (2) the impact and management of agricultural assistance to
    Afghanistan, as well as obstacles to achieving food security and
    political stability.
    -------------------------Indexing Terms-------------------------
    REPORTNUM:   GAO-03-607
        ACCNO:   A07420
      TITLE:     Foreign Assistance: Lack of Strategic Focus and Obstacles
    to Agricultural Recovery Threaten Afghanistan's Stability
         DATE:   06/30/2003
      SUBJECT:   Food relief programs
    	     Strategic planning
    	     Agricultural assistance
    	     International food programs
    	     International organizations
    	     International relations
    	     Program evaluation
    	     Afghanistan

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    GAO-03-607

                                           A

    June 30, 2003 Let er t The Honorable Richard J. Durbin

    Ranking Minority Member Subcommittee on Oversight of Government
    Management, the Federal Workforce, and the District of Columbia

    Committee on Governmental Affairs United States Senate

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

    Afghanistan is a country devastated by 23 years of war and destructive
    domestic policies and more than 4 years of drought. The livelihood of 85
    percent of Afghanistan*s approximately 26 million inhabitants depends on
    agriculture, yet the food and agricultural sector has been severely
    damaged. 1 Since 1978, the country has required international food aid to
    help meet the shortfall between food supply and demand. Since 1999, the
    United States has been the largest donor of food and agricultural
    assistance to Afghanistan. The U. S. policy goal in Afghanistan is to
    create a stable Afghan society that is not a threat to itself or others
    and is not a base for terrorism; U. S. food and agricultural assistance to
    Afghanistan is intended not only to provide emergency relief but also to
    help achieve this long- term goal. The United States has provided short-
    term, emergency food

    assistance to feed Afghanistan*s vulnerable populations, as well as
    longerterm agricultural development assistance to help Afghanistan improve
    its food security 2 and political stability. The majority of U. S.
    assistance has been given through the U. S. Agency for International
    Development (USAID) and the U. S. Department of Agriculture (USDA) to the
    United Nations (UN) World Food Program (WFP) and the UN Food and

    Agriculture Organization (FAO), as well as nongovernmental organizations.
    1 Estimates on total population vary between 24 and 28 million. 2 FAO
    defines food security as ensuring that sufficient food is available, that
    supplies are relatively stable, and that those in need of food can obtain
    it. The World Bank defines food security as the condition whereby
    everyone, at all times, has access to and control over

    high- quality food sufficient for an active and healthy life.

    Nongovernmental organizations and contractors distribute most of the
    assistance provided through the UN organizations in Afghanistan.

    Because of concerns about the United States* and UN*s ability to deliver
    assistance in such a complex environment, and recognizing the
    interrelationship of short- term emergency food assistance and longer-
    term

    agricultural assistance, you asked that we examine the food and
    agricultural assistance provided to date. We assessed, for 1999* 2002, (1)
    the impact, management, and U. S. and international support of short-
    term, emergency food assistance to Afghanistan and (2) the impact and
    management of long- term, agricultural development assistance to
    Afghanistan, as well as obstacles to achieving food security and political
    stability.

    To address these issues, we collected and analyzed information from the U.
    S. Departments of Agriculture, Defense, and State; the U. S. Agency for
    International Development; the UN World Food Program, Food and Agriculture
    Organization, and Development Program; the World Bank; the Asian
    Development Bank; and the Afghan Ministry of Agriculture and Animal
    Husbandry and Ministry of Irrigation and Water Resources. This effort
    included an analysis of the cost data for U. S. food assistance provided
    through these agencies and organizations. In addition, we contacted 14
    nongovernmental organizations, responsible for delivering WFP and FAO
    assistance in Afghanistan, to obtain their views on a range of issues
    including the management of donated commodities and coordination. Finally,
    we traveled to Afghanistan to examine the WFP*s

    operations in country. Our presence in Afghanistan was limited due to
    security precautions imposed by the Department of State. While in
    Afghanistan, we spoke with officials from U. S., UN, and nongovernmental
    organizations and the Afghan government. (For further details of the scope
    and methodology of our study, see app. I.)

    Results in Brief The emergency food assistance provided by the United
    States and the international community from January 1999 through December
    2002 helped avert famine by providing approximately 1.6 million tons of
    food. 3 The WFP managed the assistance efforts effectively, overcoming
    significant

    obstacles and employing monitoring mechanisms such as a real- time 3 In
    this report, *international community* is defined as the collective
    grouping of bilateral, multilateral, and international assistance agencies
    and nongovernmental organizations.

    automated tracking system and periodic site visits. We observed organized
    and efficient food distribution operations at WFP sites, and available
    program data showed that less than 1 percent of the assistance was lost.
    However, the inadequacy of the international community*s financial and
    inkind support of the WFP*s appeal for assistance disrupted the provision
    of food assistance throughout 2002. For example, because of lack of
    resources, the WFP reduced the amount of food rations provided to
    returning refugees from 150 kilograms to 50 kilograms. Meanwhile, as a
    result of the statutory requirement that U. S. agencies providing food
    assistance purchase U. S.- origin commodities and ship 75 percent of them

    on U. S.- flagged vessels, assistance costs and delivery times were higher
    by $35 million and 120 days, respectively, than if the United States had
    provided cash or regionally produced commodities to international
    assistance agencies.

    The agricultural assistance provided by the international community had a
    limited impact, from 1999 to 2002, because of continued conflict and
    drought. During this period, FAO, nongovernmental organizations, and
    others provided primarily short- term agricultural assistance such as
    distributing tools and seed and, as a result, the assistance did not

    significantly contribute to the reconstruction of Afghanistan*s
    agricultural sector. In addition, in 2002, international agricultural
    assistance was not adequately coordinated with the Afghan government,
    contrary to established guidelines. A new coordination mechanism was
    established in December 2002, but it is too early to determine its
    effectiveness. Because of the lack of coordination, the Afghan government
    and the international community have not developed a joint strategy to
    integrate the numerous disparate assistance projects and manage the
    overall agricultural rehabilitation effort. Finally, obstacles to future
    rehabilitation efforts include inadequate funding to meet the U. S. and
    international community*s goal of rehabilitating the agricultural sector.
    The international community plans to spend approximately $230 million on
    agricultural assistance in 2003. However, FAO officials said that the
    agricultural rehabilitation effort will cost billions of dollars and take
    at least a decade to complete. Meanwhile, the unstable security situation,
    the control by warlords of much of the country, and the growth of opium
    production create additional

    obstacles to achieving food security and political stability in
    Afghanistan. To increase the United States* flexibility in responding to
    complex emergencies where U. S. national security interests are involved,
    such as that in Afghanistan, Congress may wish to consider amending
    existing food aid legislation to allow, in the event of such emergencies,
    the provision of

    non- U. S.- produced commodities and the provision of cash to
    international assistance agencies to purchase non- U. S.- produced
    commodities and amending cargo shipping legislation to allow waiver of the
    requirement to ship food assistance on U. S. flag vessels. In addition, we
    are recommending that the Department of State (State) and USAID take an
    active role in a joint international* Afghan government effort to develop
    an operational agricultural sector rehabilitation strategy that contains
    measurable goals, defines resource levels, delineates responsibilities,
    identifies external factors that affect the achievement of goals, and
    requires program evaluations.

    We presented a draft of this report to WFP, State, USDA, USAID, and the
    Department of Defense. WFP agreed with our recommendation that the
    Agricultural Trade Development and Assistance Act of 1954 be amended, but
    State, USDA, and USAID did not. State thought that more cost- benefit
    studies were needed, and USAID and USDA stated that other existing

    legislation allows USAID and State the resources and flexibility necessary
    to respond to humanitarian crises. USDA also observed that changes in
    cargo preference regulations would help reduce overall U. S. assistance

    costs while not negatively affecting the provision of U. S. commodities.
    In addition, USDA asserted that if the United States had provided greater
    levels of commodities as a result of purchasing regionally produced
    commodities, WFP*s logistical system would have been overstrained and
    savings in cost and time would have been marginal. We maintain that
    amending the Agricultural Trade Development and Assistance Act of 1954
    would provide greater flexibility than the provisions contained in other
    existing legislation. The act is the principal authority for providing
    food assistance in emergency and nonemergency situations. In both 2002 and

    2003 over $2 billion in food assistance, the preponderant amount of this
    type of assistance, was dispersed under this authority. Amending the act
    will provide a permanent provision in the principal authority for
    providing U. S. food assistance, allowing the United States to respond
    rapidly and in a cost effective manner to events that affect U. S.
    national security. Further, in the event that U. S. commodities are not
    available, amending the act will provide the United States with the
    flexibility to respond in a timely and cost effective manner. However, we
    agree with USDA that the cargo preference requirement adds additional cost
    to food assistance and should be waived in specific situations, and we
    have adjusted the matter for congressional

    consideration to reflect this point. We disagree with USDA*s claim that
    additional commodities would have overburdened WFP and that the savings
    from purchasing regional commodities would have been insignificant. WFP
    moved record- levels of commodities through its

    extensive logistics system in Afghanistan. Further, purchasing commodities
    regionally could have reduced delivery time by 120 days and increased the
    amount of commodities purchased by 103,000 metric tons. WFP, State, USDA,
    and USAID all agreed with our recommendation that a joint Afghan*
    international donor strategy for the rehabilitation of Afghanistan*s
    agriculture sector is needed. However, USAID stated that FAO, not USAID,
    should lead such an effort. We maintain that USAID should lead the effort
    because the United States is the largest donor to Afghanistan,
    agricultural rehabilitation is the cornerstone of USAID*s efforts in
    Afghanistan, and the success of U. S. policy goals in Afghanistan is
    tightly linked to the rehabilitation of the agricultural sector.

    The Department of Defense limited its comments to issues pertaining to its
    humanitarian daily ration program. The Department of Defense stated that
    (1) we incorrectly characterized the ration program as strictly a food aid
    program, (2) its informal evaluations of the program indicated that it
    alleviated hunger and generated goodwill among the Afghan people, and (3)
    although the funds used to purchase rations could have been used to
    purchase bulk food, the bulk food could not have been delivered to remote

    areas. The report discusses the food assistance and nonfood assistance
    aspects of the rations program, and we have added information about the
    goodwill generated by the rations to the report. As described in the
    report, WFP*s well established logistics system was capable of delivering
    food to all parts of Afghanistan throughout 2001, including the months of
    October

    through December when the rations were being delivered. Background
    Afghanistan is a mountainous, arid, land- locked Central Asian country
    with

    limited natural resources. At 647,500 square kilometers, it is slightly
    smaller than the state of Texas. Afghanistan is bordered by Pakistan to
    the east and south; Tajikistan, Turkmenistan, Uzbekistan, and China to the
    north; and Iran to the west (see fig. 1). Its population, currently
    estimated at 26

    million, is ethnically diverse, largely rural, and mostly uneducated. Life
    expectancy in Afghanistan is among the lowest in the world, with some of
    the highest rates of infant and child mortality. 4

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

    childbearing age.

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

    Political conflicts have ravaged Afghanistan for years, limiting
    development within the country. Conflict broke out in 1978 when a
    communist- backed coup led to a change in government. One year later, the
    Soviet Union began its occupation of Afghanistan, initiating more than two
    decades of conflict. Over the course of the 10- year occupation, various

    countries, including the United States, backed Afghan resistance efforts.
    The protracted conflict led to the flight of a large number of refugees
    into Pakistan and Iran. In 1989, the Soviet forces withdrew, and in 1992,
    the communist regime fell to the Afghan resistance. Unrest continued,
    however, fueled by factions and warlords fighting for control.

    The Taliban movement emerged in the mid 1990s, and by 1998 it controlled
    approximately 90 percent of the country. Although it provided some
    political stability, the Taliban regime did not make significant
    improvements to the country*s food security. Furthermore, the Taliban*s
    continuing war with the Northern Alliance and the Taliban*s destructive

    policies, highlighted in its treatment of women, further impeded aid and
    development. Coalition forces removed the regime in late 2001, responding
    to its protection of al Qaeda terrorists who attacked the United States.
    In December 2001, an international summit in Bonn, Germany, established a

    framework for the new Afghan government, known as the Bonn Agreement. 5
    Agriculture is essential to Afghanistan. Despite the fact that only 11. 5
    percent (7.5 million hectares) of Afghanistan*s total area is cultivable,
    6 85 percent of the population depends on agriculture for its livelihood,
    and 80

    percent of export earnings and more than 50 percent of the gross domestic
    product have historically come from agriculture. 7 However, Afghanistan*s
    agricultural sector continues to suffer from the effects of prolonged
    drought, war, and neglect. It lacks high- quality seed, draft animals, and

    fertilizer, as well as adequate veterinary services, modern technology,
    advanced farming methods, and a credit system for farmers. Further,
    Afghanistan*s Ministry of Agriculture and Animal Husbandry and its

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

    6 One hectare is equivalent to 10,000 square meters, 2.471 acres, or 11,
    959.64 square yards. 7 Historical percentage based on UN data from the
    1970s and early 1990s.

    Ministry of Irrigation and Water Resources lack the infrastructure and
    resources to assist farmers. 8

    Because Afghanistan experiences limited rainfall, its agricultural sector
    is highly dependent on irrigation* 85 percent of its agricultural products
    derives from irrigated areas. Thus, the conservation and efficient use of
    water is the foundation of the agricultural sector. The severe drought
    that has gripped the country since 1998 has resulted in drastic decreases
    in domestic production of livestock and agricultural supplies including
    seed,

    fertilizer, and feed (see fig. 2). Several earthquakes and the worst
    locust infestation in 30 years exacerbated this crisis in 2002. Without
    adequate supplies and repairs to irrigation systems, even if the drought
    breaks, farmers will be unable to produce the food that the country needs
    to feed itself.

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

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

    Since 1965, the WFP 9 has been the major provider of food assistance to
    Afghanistan. Partnering with nongovernmental organizations, 10 it delivers
    assistance through emergency operations that provide short- term relief to
    populations affected by a specific crisis such as war or drought. It also
    conducts protracted relief and recovery operations designed to shift
    assistance toward longer- term reconstruction efforts. Because of its
    policy

    to target assistance at specific populations, WFP does not attempt to
    provide food for all of the vulnerable people within a country or affected
    area. Instead, it focuses on specific vulnerable populations such as
    internally displaced people or widows (see fig. 3). Further, it does not
    try to meet all of the daily requirements of the targeted populations.
    WFP*s 2002 emergency operation in Afghanistan targeted internally
    displaced people, people affected by drought, and children, among others.
    The assistance programs designed to assist these populations provide
    between 46 and 79 percent, or 970 to 1671 kilocalories, of the recommended
    minimum daily requirement of 2100 kilocalories. WFP assumes that
    beneficiaries will obtain the remainder of their food through subsistence
    farming or the market.

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

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

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

    FAO has provided much of the agricultural assistance 11 to Afghanistan.
    FAO has been involved in agricultural development and natural resource
    management in Afghanistan for more than 50 years. FAO was founded in 1945
    with a mandate to raise levels of nutrition and standards of living, to
    improve agricultural productivity, and to better the condition of rural

    populations. Today, FAO is one of the largest specialized agencies in the
    UN system and the lead agency for agriculture, forestry, fisheries, and
    rural

    11 Agricultural assistance includes distribution of inputs (seed, planting
    materials, fertilizer, tools, livestock); irrigation repair; water
    resource management; hydrologic and climate monitoring/ watershed
    management; agriculture product market, supply, and distribution systems
    development; rehabilitation and development of agriculture infrastructure,

    including fertilizer plants, seed farms, nurseries, product production and
    processing facilities, and government facilities (offices, labs);
    veterinary services/ artificial insemination (supplies, training); pest
    control and capacity building/ training in related subjects (horticulture,
    irrigation, animal husbandry); and development of agriculture policies,
    regulations, and laws.

    development. An intergovernmental organization, FAO has 183 member
    countries plus one member organization, the European Community. FAO has
    traditionally carried out reconstruction efforts in relatively stable
    environments. Although FAO is increasingly implementing its programs in
    unstable postconflict situations such as Afghanistan, the agency and its

    staff are still adjusting to operating in such environments. FAO's regular
    program budget provides funding for the organization's normative work and,
    to a limited extent, for advice to member states on policy and planning in
    the agricultural sector. FAO's regular budget can also fund limited
    technical assistance projects through its Technical Cooperation Program.
    Apart from this, extrabudgetary resources, through trust funds provided by
    donors or other funding arrangements, fund all emergency and development
    assistance provided by FAO. Thus, extrabudgetary resources

    fund FAO*s field program, the major part of its assistance to member
    countries.

    U. S. and International The emergency food assistance provided to
    Afghanistan by the United

    Food Assistance Had States and the international community from January
    1999 through

    December 2002 benefited millions and was well managed, but donor
    Significant Impact and

    support was inadequate. WFP delivered food to millions of people in each
    Was Well Managed, but

    of the 4 years, helping avert widespread famine. In addition, WFP managed
    Donor Support Was

    the distribution of U. S. and international food assistance effectively,
    overcoming significant obstacles and using its logistics system and a
    Problematic

    variety of monitoring mechanisms to ensure that food reached the intended
    beneficiaries. However, inadequate and untimely donor support in 2002
    disrupted some WFP assistance efforts and could cause further disruptions
    in 2003. Further, WFP could have provided assistance to an additional

    685,000 people and reduced its delivery times if the United States had
    donated cash or regionally purchased commodities instead of shipping U.
    S.- produced commodities. Additionally, if the United States had donated
    the $50.9 million that it spent on approximately 2.5 million daily rations
    airdropped by the Department of Defense, WFP could have purchased enough
    regionally produced commodities to provide food assistance for an
    estimated 1.0 million people for a year.

    Food Assistance Had The emergency food assistance that the United States
    and other bilateral

    Important Impact donors provided in Afghanistan through WFP from 1999
    through 2002 met a

    portion of the food needs of millions of vulnerable Afghans. Over the 4-
    year period, WFP delivered approximately 1.6 million metric tons of food
    that helped avert famine and stabilize the Afghan people, both in
    Afghanistan and in refugee camps in neighboring countries. 12 The food
    assistance also furthered the country*s reconstruction through projects,
    among others, that exchanged food for work. WFP delivered the assistance
    as part of seven protracted relief* recovery and emergency operations (see
    table 1). 13 The types of operations and their duration and objectives
    varied in response to changing conditions within Afghanistan. These
    objectives included, but

    were not limited to, providing relief to the most severely affected
    populations in Afghanistan and Afghan refugees in neighboring countries
    and preventing mass movements of populations.

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

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

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

    Total cash donations

    Percentage of Target ed

    (millions of cash contributed

    Food donations Percentage of food

    beneficiaries Duration

    dollars) by U. S. (metric tons) contributed by U. S.

    (millions)

    1/ 99* 12/ 99 a $49.5 87. 3 111, 502 89.7 1. 2 1/ 00* 12/ 01 b 54. 3 61. 0
    121,989 61.5 1. 0 8/ 00* 3/ 01 c 47. 9 78. 4 114,694 78.5 1. 6 4/ 01* 10/
    01 d 82. 2 86. 7 184,462 82.8 3. 8 11/ 01* 10/ 02 e 43. 8 100. 0 100,000
    100.0 5. 6 10/ 01* 3/ 02 f 225.4 61. 2 500, 624 58.8 7. 5 4/ 02* 6/ 03 g
    242.3 64.5 h 516,394 60. 0 h 9.9

    Total $745.4 N/ A 1,649,665 N/ A N/ A I

    Average percentage of N/ A 68. 0 N/ A 67.0 N/ A

    contributions from U. S. Legend N/ A = not applicable Source: WFP.

    a Protracted relief and recovery operation 6064. b Protracted relief and
    recovery operation 6064.01. Operation suspended, activities integrated
    into emergency operation 10046.0. c Emergency operation 6259.0.

    d Emergency operation 10046.0. Operation terminated and replaced with
    emergency operation 10126.0. e Emergency operation 10098. Operation
    terminated and replaced with emergency operation 10126.0.

    f Emergency operation 10126.0. Covered beneficiaries in Afghanistan, Iran,
    Pakistan, and Tajikistan. g Emergency operation 10155.0. h As of March 31,
    2003. I The cumulative total of beneficiaries cannot be calculated since
    the same beneficiaries may have been served multiple times during the 4-
    year period.

    WFP implemented a number of different types of food assistance projects,
    including free food distribution; institutional feeding programs;
    bakeries; food- for- work, -seed, -education, -training, and -asset-
    creation projects; and

    projects targeted at refugees, internally displaced people, and civil
    servants. (See app. II for a list and description of WFP*s projects.)
    Food- forwork and food- for- asset- creation projects provided essential
    food assistance to the most vulnerable members of Afghanistan*s population

    while enabling the beneficiaries to help rehabilitate local infrastructure
    and rebuild productive assets such as roads and schools. Between July and
    September 2002, these projects employed 1 million laborers per month,
    paying them in food commodities. 14 U. S. food assistance to Afghanistan,
    provided by USAID and USDA,

    accounted for approximately 68 percent of the cash contributions and 67
    percent of the commodities delivered by WFP from 1999 through 2002 (see
    table 1). The U. S. provides cash to WFP to cover transportation and

    administrative costs associated with its in- kind contributions of
    commodities. 15 USAID*s authority to donate to WFP operations derives from
    Title II of the Agricultural Trade Development and Assistance Act of 1954
    (P. L. 480). Title II authorizes the agency to donate agricultural
    commodities to meet international emergency relief requirements and carry
    out nonemergency feeding programs overseas. USDA also provides surplus
    commodities to WFP under section 416( b) of the Agricultural Act of 1949.
    U. S. contributions consisted of in- kind donations of commodities such as
    white wheat and cash donations to cover the cost of transporting the
    commodities from the United States to Afghanistan.

    Food Assistance WFP managed the distribution of U. S. and international
    food assistance to

    Distribution Was Well Afghanistan effectively despite significant
    obstacles, including harsh

    Managed weather and a lack of infrastructure to deliver food to
    beneficiaries. To accomplish this, WFP appointed a special envoy to direct
    operations and

    employed a dedicated staff of local nationals. It also used various
    monitoring and reporting mechanisms to track the delivery of food.

    14 For example, food- for- work participants earn 7 kilograms of wheat per
    day, valued at $1.00. Wage rates across Afghanistan range from $1.50 to
    $3.40 per day. 15 WFP requires donors to provide funding to cover
    transportation and administrative costs for in- kind contributions of
    commodities. The cash that the U. S. contributes for this purpose

    cannot be used by WFP to purchase commodities.

    WFP*s Management Overcame In distributing the food assistance, WFP faced
    significant obstacles related

    Many Obstacles to political and security disturbances in Afghanistan as
    well as physical and

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

    Figure 4: Road Conditions Faced by WFP Truckers in Afghanistan

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

    Special Envoy and Staff Ensured WFP created the position of Special Envoy
    of the Executive Director for

    Effective Delivery the Afghan Region to lead and direct all WFP operations
    in Afghanistan and neighboring countries during the winter of 2001* 2002,
    when it was believed

    that the combination of winter weather and conflict would increase the
    need for food assistance. WFP was thus able to consolidate the control of
    all resources in the region, streamline its operations, and accelerate the

    movement of assistance. 16 WFP points to the creation of the position as
    one of the main reasons it was able to move record amounts of food into
    Afghanistan from November 2001 through January 2002. In December 2001
    alone, WFP delivered 116,000 metric tons of food, the single largest

    monthly food delivery within a complex emergency operation in WFP*s
    history. WFP also credits its quick response to its national staff and the
    Afghan truck drivers it contracted. WFP employed approximately 400 full-
    time

    national staff during 1999* 2002. These staff established and operated an
    extensive logistics system and continued operations throughout
    Afghanistan, including areas that international staff could not reach
    owing to security concerns, and during periods when international staff
    were evacuated from the country. The truckers who moved the food around
    the country continued working even during the harshest weather and in
    areas that were unsafe because of ongoing fighting and banditry.

    WFP Monitoring Shows Effective WFP uses a number of real- time monitoring
    mechanisms to track the

    Distribution and Negligible distribution of commodities in Afghanistan,
    and the data we reviewed

    Losses suggested that food distributions have been effective and losses
    minimal.

    (For a description of WFP*s monitoring procedures, see app. III.) During
    our visits to project and warehouse sites in Afghanistan, we observed
    orderly and efficient storage, handling, and distribution of food
    assistance. 17 WFP*s internal auditor reviewed WFP Afghanistan*s
    monitoring operations in August of 2002 and found no material weaknesses.
    USAID has also conducted periodic monitoring of WFP activities without
    finding any major flaws in WFP*s operations. In addition, most of the
    implementing partners we contacted were familiar with WFP reporting
    requirements. However, 10 of the 14 implementing partners we

    contacted commented unfavorably on WFP*s project monitoring efforts,
    stating that monitoring visits were too infrequent. Finally, WFP*s loss
    reporting data indicated that only 0.4 percent of the commodities was lost
    owing to theft, spoilage, mishandling, or other causes.

    16 The special envoy*s term ran from November 2001 to May 2002. A second
    envoy was not appointed. 17 Owing to security restrictions, we were able
    to conduct only limited site visits in Afghanistan.

    Inadequate International Inadequate and untimely donor support disrupted
    WFP*s food assistance

    Support Disrupted Food efforts in 2002 and could disrupt efforts in 2003;
    in addition, U. S. assistance

    Assistance; U. S. to Afghanistan, both through WFP and the Department of
    Defense, was

    Contributions Costly and costly. In 2002, interruptions in support forced
    WFP to delay payments of

    food, curtail the implementation of new projects, and reduce the level of
    Slow rations provided to repatriating refugees. WFP expressed concern that
    donor support in 2003 may be similarly affected, as a growing number of

    international emergencies and budgetary constraints could reduce the total
    funding available for food assistance to Afghanistan. 18 In addition, WFP
    could have delivered more food and reduced delivery times if the United
    States had provided either cash or regionally purchased commodities
    instead of shipping U. S.- produced commodities and airdropping
    humanitarian daily rations.

    Limited International Donor Obtaining donor support for the emergency food
    assistance operation for

    Support Disrupted Food the April 2002 through December 2002 period was
    difficult owing to the

    Assistance in 2002, Could donor community*s inadequate response to WFP*s
    appeal for contributions. Disrupt Efforts in 2003

    WFP made its initial appeal in February 2002 for the operation and it made
    subsequent appeals for donor support throughout the operation. The
    operation was designed to benefit 9,885,000 Afghans over a 9- month
    period, through the provision of 543,837 metric tons of food at a cost of
    over $295 million. 19 It was also intended to allow WFP to begin to shift
    from emergency to recovery operations with particular emphasis on
    education, health, and the agricultural sector. When the operation began
    in April 2002,

    WFP*s Kabul office warned that it might have to stop or slow projects if
    donors did not provide more support. At that time, WFP had received only
    $63.9 million, or 22 percent of the required resources. The United States
    provided most of this funding. (See app. IV for a list of donors and their
    contributions for the operation.) From April through June* the preharvest
    period when Afghan food supplies are traditionally at their lowest point*
    WFP was able to meet only 51 percent of the planned requirement for

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

    19 Emergency Operation 10155. 0 *Emergency Assistance to Afghanistan.* The
    period of the operation was originally 9 months but was extended to 15
    months to ensure a continued pipeline of food and a smooth transition
    between this operation and the subsequent operation.

    assistance. WFP*s actual deliveries were, on average, 33 percent below
    actual requirements for the 10- month period April 2002* January 2003.
    Figure 6 illustrates the gaps in the operation*s resources for the 10-
    month period.

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

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

    Lack of timely donor contributions and an increase in the number of
    returning refugees forced WFP and its implementing partner, the UN High
    Commissioner for Refugees, to reduce from 150 to 50 kilograms the rations
    provided to help returning refugees and internally displaced persons
    reestablish themselves in their places of origin. The rations are intended
    to enable these groups to sustain themselves long enough to reestablish
    their lives; reducing the rations may have compromised efforts to
    stabilize population movements within Afghanistan. The lack of donor
    support also forced WFP and its implementing partners to delay for up to
    10 weeks, in

    some cases, the compensation promised to Afghans who participated in the
    food- for- work and food- for- asset- creation projects, resulting in a
    loss of credibility in the eyes of the Afghans and nongovernmental
    organizations.

    Similarly, because of resource shortages, WFP had to delay for up to 8
    weeks in- kind payments of food in its civil service support program,
    intended to help the new government establish itself, and it never
    received

    enough contributions to provide civil servants with the allocation of tea
    they were to be given as part of their support package. In addition, WFP
    was forced to reduce the number of new projects it initiated, thus
    limiting the level of reconstruction efforts it completed.

    In January 2003, WFP expressed concern that the problems it encountered
    with donor support in 2002 could recur in 2003. Despite the expansion of
    agricultural production in 2002 because of increased rainfall, 6 million

    Afghans will require food assistance in 2003. Although the United States
    was the largest donor of food assistance to Afghanistan in 2002, the U. S.
    contribution may be smaller in 2003 than in previous years owing to

    reduced surpluses of commodities, higher commodity prices, and competing
    crises in Africa, North Korea, and Iraq. 20 The UN forecasts Afghan cereal
    production for July 2002 through June 2003 at 3.59 million metric tons, a
    cereal import requirement of 1.38 million metric tons, and Afghan
    commercial food imports at 911,000 metric tons. Thus, an estimated total
    deficit of 469,000 metric tons remains to be covered in the 12- month
    period by international food assistance. 20 Section 416( b) of the
    Agricultural Act of 1949 provides a permanent authority for USDA to

    donate surplus commodities in Commodity Credit Corporation inventories to
    carry out programs of assistance in developing and other foreign
    countries. The administration has decided to sharply reduce reliance on
    this program. The administration expects to use only $50 million in 416(
    b) commodities worldwide in 2003, compared with $360 million in 2002

    and $634 million in 2001. It has increased P. L. 480 Title II funding by
    approximately $800 million in fiscal year 2003 in part to offset the
    decrease.

    U. S. Food Assistance The U. S.- produced commodities and humanitarian
    daily rations provided

    Contributions Were Costly and by the United States to Afghanistan resulted
    in lower volumes of food than

    Inefficient if the United States had provided regionally purchased
    commodities or

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

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

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

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

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

    ITSH= internal transport, storage, and handling within Afghanistan Inland
    freight = freight costs from port of arrival to Afghan border Ocean
    freight = freight costs from U. S. port to port of arrival

    We estimated that if the United States had provided cash or regionally
    purchased commodities instead of U. S.- produced commodities in 2002, WFP
    could have purchased approximately 103,000 additional metric tons

    of commodities and saved 120 days in delivery time. WFP officials in Rome
    and Cairo 21 stated that cash was greatly preferable to in- kind donations
    because it allows for flexibility and for local and regional purchases.
    Other contributors to WFP efforts in Afghanistan have provided cash,
    allowing WFP to make the purchases it deemed most expedient, including
    purchases from Central Asian countries that produced large surpluses in

    2002. 22 Ninety- three percent of the commodities WFP purchased for the
    emergency operation that began in April 2002 (157, 128 metric tons) were
    from Kazakhstan and Pakistan. 23 WFP also stated that it could have saved
    approximately 120 days in delivery time if it had received U. S.
    contributions in cash that it could have used for regional purchases.

    21 WFP*s Regional Bureau for the Mediterranean, Middle East, and Central
    Asia is located in Cairo, Egypt, and is responsible for operations in
    Afghanistan. 22 In March 2002 testimony before the Senate Foreign
    Relations Committee, the Administrator of USAID stated, *The countries
    surrounding Afghanistan had plenty of surplus food available, thus
    ensuring price stability, to meet the needs of the Afghan people.

    However, the tools did not exist for the U. S. government to respond more
    effectively and, possibly, at lower cost to the taxpayer.* In 2002,
    Kazakhstan exported 6 million metric tons of wheat and Pakistan exported
    1.6 metric tons.

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

    Although the commodity costs and some of the freight costs for regional
    purchases are lower, the largest portion of the savings from regional
    purchases comes from eliminating ocean freight costs. In 2002, USDA spent

    $5.6 million on ocean freight, or 31 percent of the value of the aid it
    provided to Afghanistan. USAID spent $29.4 million on ocean freight, or
    18.3 percent of the value of the aid it provided to Afghanistan. Overall,
    USDA and USAID spent approximately $35.0 million on ocean freight and
    commissions, or 19.6 percent of the total value ($ 178,068,786) of the
    food aid they provided through WFP to Afghanistan. Had this money been
    spent on regional purchases instead of on ocean freight, it could have
    paid for 103,000 additional metric tons of commodities, or enough to
    provide food assistance for approximately 685,000 people for 1 year. 24
    However, the laws governing the main food assistance programs under which
    most of the U. S. assistance was provided to Afghanistan through WFP do
    not provide for USAID and USDA to purchase food assistance commodities
    regionally or provide cash to WFP to make regional purchases. All of the
    assistance must be provided in the form of U. S. commodities, and 75
    percent of the commodities by weight must be shipped on U. S.- flag
    vessels. 25 According to USDA, this requirement referred to as *cargo
    preference* accounts for 9 percent of the cost of U. S. food assistance
    shipments worldwide. In this case, it accounted for approximately $16
    million of the $35 million in ocean freight. In prior reports we reported
    that the most significant impact of the cargo preference requirement on U.
    S. food assistance programs is the

    additional costs incurred. 26 Using U. S.- flag vessels reduces funds
    available for purchasing commodities, thus the amount of food delivered to
    vulnerable populations is decreased. In its 2002 annual assessment of

    management performance, the Office of Management and Budget concluded that
    U. S. food assistance programs would be more cost effective

    24 Estimate based on the ration provided to refugees in Afghanistan: 12. 5
    kilograms (27.5 pounds) of wheat per person per month and regional
    commodity and transportation costs of $340 per metric ton.

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

    26 For further information on impact of shipping U. S. commodities on U.
    S. flagged cargo vessels see Cargo Preference Requirements: Objectives Not
    Significantly Advanced When Used in U. S. Food Aid Programs, GAO/ GGD- 94-
    215 (Washington, D. C.: September 1994).

    Cargo Preference Requirements: Their Impact on U. S. Food Aid Programs and
    the U. S. Merchant Marine, GAO/ NSIAD- 90- 174 (Washington, D. C.: June
    1990).

    and flexible if the requirement to ship U. S. food assistance on U. S.-
    flag vessels was eliminated. In commenting on a draft of this report, USDA
    stated that consideration should be given to waiving cargo preference
    requirements in specific food aid situations.

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

    Humanitarian Daily Rations Were Expensive and Inefficient

    The U. S. Department of Defense*s humanitarian daily ration program was a
    largely ineffective and expensive component of the U. S. food assistance
    effort. The program was initiated to alleviate suffering and convey that
    the United States was waging war against the Taliban, not the Afghan
    people. However, the program*s public relations and military impact have
    not been

    formally evaluated. Airdrops of the humanitarian daily rations were
    intended to disperse the packets over a wide area, avoiding the dangers of
    heavy pallet drops or having concentrations of food fall into the hands of
    a few. On October 8, 2001, U. S. Air Force C- 17s began dropping rations
    on various areas within Afghanistan. Drops averaged 35,000 packets per
    night (two planeloads) and ended on December 21, 2001. In 198 missions
    over 74 days, the Air Force dropped 2,489, 880 rations (see fig. 8). 27

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

    Figure 8: Humanitarian Daily Rations

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

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

    Defense officials told us that the rations are an expensive and
    inefficient means of delivering food assistance and were designed to
    relieve temporary food shortages resulting from manmade or natural
    disasters* not, as in Afghanistan, to feed a large number of people
    affected by a longterm food shortage. Defense officials responsible for
    the ration program stated that the humanitarian, public relations, and
    military impact of the

    effort in Afghanistan had not been evaluated. According to these
    officials, anecdotal reports from Special Forces soldiers indicated that
    vulnerable populations did receive the food and that the rations helped to
    generate goodwill among the Afghan people. However, reports from
    nongovernmental organizations in Afghanistan indicated that often the
    rations went to the healthiest, since they were able to access the drop
    zone most quickly, and were hoarded by a few rather than distributed among
    the population.

    The cost of the rations was $4.25 per unit, or $10,581,990 for the
    approximately 2.5 million dropped. The total cost of the program was
    $50,897,769, or $20.44 per daily ration. Delivery cost is estimated at
    $16.19 per unit, based on the difference in the ration cost and the
    department*s total expenditure. The rations accounted for only 2,835
    metric tons out of

    the total of 365,170 metric tons, or .78 percent of the total weight of
    food aid delivered in fiscal year 2002. However, the cost of the rations
    equals 28. 6 percent of the $178, 068, 786 that USAID and USDA spent on
    emergency assistance to Afghanistan from October 2001 through September
    2002. If

    the United States had bought traditional food assistance commodities
    regionally instead of dropping the 2,835 metric tons of rations, it could
    have purchased approximately 118,000 metric tons of food, enough to
    provide food assistance to 1.0 million people for 1 year.

    Agricultural Assistance The U. S. and international community*s
    agricultural reconstruction efforts

    Has Had Limited in Afghanistan have had limited impact, coordination of
    the assistance has

    been fragmented, and significant obstacles jeopardize Afghanistan*s
    longterm Impact and Lacks

    food security and political stability. Because of drought and adverse
    Coordination, and

    political conditions, agricultural assistance provided by the
    international Major Obstacles

    community has not measurably improved Afghanistan*s long- term food
    security. In 2002, collective efforts to coordinate reconstruction
    assistance,

    Jeopardize Food especially with the Afghan government, were ineffectual
    and, as a result, no

    Security and Political single operational strategy has been developed to
    manage and integrate

    international agricultural assistance projects. Finally, the inadequacy of
    Stability proposed agricultural assistance, and the increase in domestic
    terrorism, warlords* control of much of the country, and opium production
    all present obstacles to the international community*s goal of achieving
    food security and political stability in Afghanistan.

    Impact of Agricultural For most of the period 1999* 2002, because of war
    and drought, FAO, Assistance Limited by

    bilateral donors, and more than 50 nongovernmental organizations in
    Drought and Political

    Afghanistan focused resources primarily on short- term, humanitarian
    Factors

    relief; consequently, the impact of this effort on the agricultural
    sector*s long- term rehabilitation was limited. The assistance was
    provided in an effort to increase short- term food security and decrease
    Afghanistan*s dependence on emergency food assistance. During most of the
    4- year period, FAO provided $28 million in assistance to Afghanistan
    partly under the UN Development Program*s (UNDP) Poverty Eradication and
    Community Empowerment program and partly as donor- funded response to the
    drought. 28 The poverty eradication program ended in 2002, but FAO
    continues its projects in Afghanistan. FAO*s short- term activities focus
    on efforts to enable war- and drought- affected populations to resume food

    production activities. These activities include providing agricultural
    inputs such as tools, seed, and fertilizer; controlling locusts; and
    making repairs to small- scale irrigation systems (see fig. 9). Its
    longer- term activities include, among other things, the establishment of
    veterinary clinics, assistance in the production of high- quality seed
    through 5,000 contracted Afghan farmers, and horticulture development.
    From 1999 to 2002, bilateral efforts focused on the distribution of
    agricultural inputs and the repair of irrigation systems. USAID activities
    currently include developing a market- based

    distribution system for agricultural inputs as well as distributing
    highquality seed. 29 As of March 2002, at least 50 of the approximately
    400 national and international nongovernmental organizations working in
    Afghanistan were involved in agriculture- related assistance, including
    providing agricultural inputs, farmer training, microcredit, and the
    construction of wells.

    28 During the 1990s, FAO*s emergency and longer- term development efforts
    were conducted under strategies and programs managed by UNDP. 29 USAID
    spent approximately $23 million on agriculture assistance in Afghanistan
    in 2002.

    Figure 9: FAO Irrigation Rehabilitation Project

    For most of the 4- year period, the rise of the Taliban, the continuing
    conflict with the Northern Alliance, and the ongoing drought prevented the
    international community from shifting from short- term relief projects to
    longer- term agricultural rehabilitation projects and reversed earlier
    advancements in agricultural production. For example, by 1997, agriculture
    in some areas had returned to prewar levels, and Afghanistan as a whole
    had reached 70 percent self- sufficiency in the production of cereals. At
    the time, assistance agencies were planning to implement longer- term
    assistance activities but were unable to do so owing to drought and
    conflict. These same factors resulted in decreases in cereal production
    and livestock herds of 48 percent and 60 percent, respectively, from 1998
    through 2001. In 2002, a number of longer- term agricultural
    rehabilitation

    efforts were started, including efforts by USAID to reestablish
    agricultural input and product markets. However, these efforts have not
    been evaluated, and it is too early to determine their sustainability
    after donor assistance ends or their long- term impact.

    Weak Assistance International assistance, including agricultural
    assistance, was not well

    Coordination in 2002 coordinated in 2002, and, as a result, the Afghan
    government was not

    Hindered Afghan substantively integrated into the agricultural recovery
    effort and lacks an Government*s Involvement

    effective operational strategy. In December 2002, the Afghan government
    and the international community instituted a new mechanism, the and
    Development of

    Consultative Group, to improve coordination. However, the Consultative
    Operational Strategy

    Group is similar in purpose and structure to a mechanism used earlier in
    2002, the Implementation Group, and does not surmount the obstacles that
    prevented the Implementation Group*s success. Because of the lack of
    coordination, the Afghan government and the international community have
    not developed a single operational strategy to direct the agricultural
    rehabilitation effort; instead, all of the major assistance organizations
    have independent strategies. Although documents prepared by the Afghan
    government and others to manage assistance efforts contain some of the
    components of an effective operational strategy, these components have not
    been combined in a coherent strategy. The lack of an operational strategy
    hinders efforts to integrate projects, focus resources, empower Afghan
    government ministries, and make the international community more
    accountable.

    Assistance Coordination Despite efforts to synchronize multiple donors*
    initiatives in a complex and

    Was Weak in 2002 changing environment, coordination of international
    assistance in general, and agricultural assistance in particular, was weak
    in 2002. According to

    the UN, assistance coordination refers to a recipient government*s
    integration of donor assistance into national development goals and
    strategies. From the beginning of the assistance effort in 2002, donors
    were urged to defer responsibility for assistance coordination to the
    Afghan government as stipulated in the Bonn Agreement. 30 According to the
    UN, coordination rests with the Afghan government, efforts by the aid
    community should reinforce national authorities, and the international
    community should operate, and relate to the Afghan government, in a
    coherent manner rather than through a series of disparate relationships.
    31 30 Annex III of the Bonn Agreement states that the participants in the
    UN Talks on

    Afghanistan hereby urge the UN, the international community, particularly
    donor countries and multilateral institutions, to reaffirm, strengthen and
    implement their commitment to assist with rehabilitation, recovery, and
    reconstruction of Afghanistan, in coordination with the Afghan government.

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

    The Security Council resolution that established the UN Assistance Mission
    in Afghanistan goes further; it states that reconstruction assistance
    should be provided through the Afghan government and urges the
    international community to coordinate closely with the government. 32 In
    April 2002, the Afghan government attempted to exert leadership over the
    highly fragmented reconstruction process. To accomplish this task, the

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

    The Implementation Group mechanism proved to be largely ineffective.
    Officials from the Afghan government, the UN, the Department of State, and
    USAID, as well as a number of nongovernmental bodies, expressed

    concern over the lack of meaningful and effective coordination of
    assistance in Afghanistan in 2002. For example, a high- ranking WFP
    official in Afghanistan said that coordination efforts since September 11,
    2002, paid only *lip- service* to collaboration, integration, and
    consensus. In August 2002, the Ministers of Foreign Affairs, Rural
    Reconstruction and Development, Irrigation, and Agriculture stated that
    the donor community*s effort to coordinate with the government was poor to
    nonexistent. A

    USAID official characterized the coordination of reconstruction in 2002 as
    32 Security Council Resolution 1401 (2002), S/ RES/ 1401, March 28, 2002.
    33 The framework is organized around three *pillars*: (1) humanitarian
    assistance and human social capital, (2) physical reconstruction and
    natural resources, and (3) private sector development. Under the three
    pillars there are 12 programs supported by a number of

    subprograms. Subprograms for agriculture and irrigation fall under *Pillar
    2, Physical Reconstruction and Natural Resources, program for Natural
    Resources Management.*

    an *ugly evolution* and *the most complex post- conflict management
    system* he had ever seen.

    The ineffectiveness of the Implementation Group mechanism resulted from
    its inability to overcome several impediments. First, each bilateral,
    multilateral, and nongovernmental assistance agency has its own mandate,
    established by implementing legislation or charter, and sources of
    funding, and each agency pursues development efforts in Afghanistan
    independently. Second, the international community asserts that the Afghan
    government lacks the capacity and resources to effectively assume the role
    of coordinator and, hence, these responsibilities cannot be

    delegated to the government. Third, no single entity within the
    international community has the authority and mandate to direct the
    efforts of the myriad bilateral, multilateral, and nongovernmental
    organizations providing agricultural assistance to Afghanistan. 34
    Finally, efforts to coordinate agricultural assistance were further
    complicated because the Ministries of Agriculture, Irrigation, and
    Rehabilitation and

    Rural Development share responsibility for agriculture development.
    Efforts to Improve Coordination

    In December 2002, the Afghan government instituted a new coordination Have
    Been Implemented

    system, the Consultative Group mechanism. 35 The overall objective of the
    Consultative Group in Afghanistan is to increase the effectiveness and
    efficiency of assistance coordination in support of goals and objectives
    contained in the National Development Framework. 36 According to the
    Afghan government, the program- level consultative groups established

    34 Donor nations have taken the lead in other sectors. Specifically, the
    United States leads in training the national army, Germany in training the
    police, Italy in rebuilding the judicial system, and the United Kingdom in
    drug control. These donor nations, in consultation with

    the Afghan government and the international community, have developed
    strategies for reconstructing their respective sectors.

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

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

    under this mechanism provide a means by which the government can engage
    donors, UN agencies, and nongovernmental organizations to promote specific
    national programs and objectives presented in the government*s National
    Development Framework and the projects articulated in the Afghan National
    Development Budget. 37 According to advisors to the Afghan government, the
    Consultative Group mechanism provides a real opportunity for donors to
    provide focused support for policy development, project preparation,
    implementation, monitoring, and evaluation.

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

    Development Framework and to direct funding toward the projects in the
    Afghan National Development Budget.

    Despite the effort to develop a more effective coordination mechanism, the
    Consultative Group mechanism has not surmounted the conditions that
    prevented the Implementation Group from effectively coordinating
    assistance. For example, in 2003, donor governments and assistance
    agencies have continued to develop their own strategies, as well as fund
    and implement projects outside the Afghan government*s national budget. In
    addition, agricultural assistance is divided up among several

    consultative groups including the groups for natural resources management
    and livelihoods. Further, unlike food assistance where donors primarily
    use one agency, WFP, for channeling resources, donors continue to use a
    variety of channels for their agriculture assistance. Although the Afghan
    government asserts that it is assuming a greater level of leadership over
    the coordination effort, as of May 2003, we could not determine whether
    the new coordination mechanism would be more successful than earlier
    efforts.

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

    Lack of Coordination Prevented Because of the inadequate coordination of
    agricultural assistance, the

    Development of Operational Afghan government and the international
    community have not developed

    Strategy an operational agricultural sector strategy. Each assistance
    agency has

    published its own development strategy that addresses agriculture and
    numerous other sectors. The Consultative Group mechanism and the National
    Development Framework, as well as other documents prepared by the Afghan
    government and others to manage assistance efforts, contain some of the
    components of an effective operational strategy, such as measurable goals
    and impediments to their achievement. However, these components have not
    been incorporated in a single strategy. Without an integrated operational
    strategy, jointly developed by the Afghan

    government and the international community, the Afghan government lacks a
    mechanism to manage the agricultural rehabilitation effort, focus limited
    resources, assert its leadership, and hold the international donor
    community accountable. 38 Assistance Agencies Have Developed Separate
    Strategies

    No donor has taken the lead in the agricultural sector; consequently,
    multilateral, bilateral, and nongovernmental organizations, including the
    UN, FAO, the Asian Development Bank, the World Bank, USAID, and others,
    have prepared individual strategies that address, to varying degrees,
    agricultural reconstruction and food security. 39 However, these
    strategies lack measurable national goals for the sector and have not been
    developed jointly with the Afghan government. For example, in August 2002,
    the Minister of Agriculture stated, *The ministry does not know the
    priorities of

    the international community for the agricultural sector, how much money
    will be spent, and where the projects will be implemented.* FAO claimed
    that the Ministry of Agriculture had endorsed FAO*s agricultural
    rehabilitation strategy. However, no letter of agreement or memorandum of
    understanding between the FAO and the ministry documents the acceptance of
    the strategy. The Minister of Agriculture told us, in December 2002, that
    the ministry had not endorsed FAO*s latest strategy.

    Further, the Ministry of Agriculture presented a list of more than 100
    prioritized rehabilitation projects to the international community. As of
    late

    38 According to the UN, *assistance management* refers to the effective
    implementation of donor- funded development programs. 39 Assistance
    proposed in these strategies includes technical assistance, inputs such as
    seeds and fertilizer, capacity building for government staff, irrigation
    repair, water resource management, livestock rehabilitation, and credit to
    small farmers, among other things.

    December 2002, the international community had not responded regarding the
    ministry*s proposed projects.

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

    Although Consultative Group mechanism* related documents, the Afghan
    National Development Framework, and other documents prepared by the Afghan
    government and others to manage assistance efforts contain some of the
    components of an effective operational strategy, these components have not
    been incorporated in a single strategy. For an operational agricultural
    strategy to be effective, all relevant stakeholders must participate in
    its formulation. In this case, stakeholders include the Afghan Ministries
    of Agriculture and Irrigation and key nongovernmental, multilateral, and
    bilateral development organizations. Further, such strategies must
    establish measurable goals, set specific time frames, determine resource
    levels, and delineate responsibilities. For example, in Afghanistan, one
    such goal might be to increase the percentage of irrigated

    land by 25 percent by 2004 through the implementation of $100 million in
    FAO- led irrigation projects in specific provinces. In addition, an
    operational strategy should identify external factors that could
    significantly affect the achievement of goals and include a schedule for
    future program evaluations. 40 Stakeholders should implement the strategy
    through projects that support the measurable goals of the strategy and
    broader policy objectives, such as those contained in the Afghan
    Government*s National Development Framework (see fig. 10). 40 Government
    Performance and Results Act of 1993 P. L. 103- 62. U. S. General
    Accounting

    Office Congressional Review of Agency Strategic Plans, GAO/ GGD- 10. 1. 16
    (Washington, D. C.: January 1995). Office of Management and Budget,
    Circular A- 11, Part 6* Preparation and Submission of Strategic Plans,
    Annual Performance Plans, and Annual Program Performance Results
    (Washington, D. C.: June 2002).

    Figure 10: Hierarchy of Strategies for Agricultural Sector Reconstruction

    The Implementation Group and its successor, the Consultative Group, as
    well as the National Development Framework and other documents, contain
    some of the essential elements of an operational strategy. These elements
    include the involvement of key stakeholders, the development of some
    measurable objectives, and the identification of external factors that
    could affect the achievement of goals. However, since the National
    Development Framework is a general national strategy and not a detailed
    operational strategy, it is sufficiently broad that any assistance to the

    agricultural sector could be considered supportive of the framework, even
    if the assistance were not well targeted or made no significant impact. In
    addition, the various elements of an effective operational strategy that
    are contained in the National Development Framework and other documents
    have not been effectively applied, nor has a single agricultural sector
    strategy incorporating all of these elements been developed. The UN
    Assistance Mission for Afghanistan*s management plan endorses

    the formulation of joint strategies for reconstruction. In late December
    2002, Afghanistan*s Minister of Agriculture told us that he would welcome
    the development of a joint Afghan* international agricultural sector
    strategy containing clear objectives, measurable goals, concrete funding
    levels, and

    clearly delineated responsibilities. In January 2003, FAO*s Assistant
    Director- General of Technical Cooperation stated that FAO would welcome

    the opportunity to assist the Ministry of Agriculture in preparing a
    strategy. The Consultative Group mechanism could serve as a vehicle to
    support the development of such a strategy. In March 2003, Afghan
    government advisors told us that consultative groups could develop
    strategies based on the subprograms contained in the National Development
    Framework and National Development Budget. Proposals for the development
    of strategies pertaining to natural resources management, including
    agriculture, have been drafted, and support for these proposals is being
    sought from the international community.

    Lack of Operational Agricultural Sector Strategy Limits Integration and
    Oversight

    The lack of an operational agricultural sector strategy hinders efforts to
    integrate disparate projects, focus limited assistance resources, place
    Afghan government ministries in a leadership role, and make the
    international community more accountable to the Afghan government. In its
    October 2002 National Development Budget, the Afghan government

    cited the lack of a strategic framework for the natural resources
    management sector, including agriculture, as an impediment to
    rehabilitation. Absent an operational strategy, the Afghan government
    lacks

    a mechanism to  integrate disparate projects into an effective
    agricultural rehabilitation

    program,  manage finite resources so as to ensure the greatest return on

    agricultural investment, and  guide the efforts of the international
    community and assert the Afghan government*s leadership in agricultural
    reconstruction. Finally, an operational agricultural sector strategy that
    includes measurable goals and the means to assess progress against those
    goals could increase accountability. 41 Because no comprehensive
    integrated strategy exists, the Afghan government lacks the means to hold
    the international assistance community accountable for implementing the
    agricultural sector reconstruction effort and achieving measurable
    results.

    41 Government Performance and Results Act.

    Limited Funding and Major obstacles to the goal of a food- secure and
    politically stable Afghan

    Security Problems Present state include inadequate assistance funding, as
    well as a volatile security

    Obstacles to Food Security situation, long- standing power struggles among
    warlords, and the rapid

    and Political Stability increase in opium production. Donor support has
    not met Afghanistan*s

    recovery and reconstruction needs, and future funding levels for
    agricultural assistance may be inadequate to achieve the goal of food
    security and political stability, primarily because assistance levels are

    based on what the international community is willing to provide rather
    than on Afghanistan*s needs. Meanwhile, the continued deterioration of the
    security situation, exacerbated by a rising incidence of terrorism, the
    resurgence of warlords, and near- record levels of opium production, are
    impeding reconstruction and threaten to destabilize the nascent Afghan
    government.

    International Assistance May Be Total assistance levels, including those
    for agricultural reconstruction,

    Insufficient to Meet Needs proposed at the Tokyo donors* conference in
    January 2002 do not provide

    Afghanistan with enough assistance to meet its estimated needs. 42 The
    preliminary needs assessment prepared for the January 2002 donor*s
    conference in Tokyo estimated that, in addition to humanitarian assistance

    such as food and shelter assistance, between $11.4 and $18.1 billion over
    10 years would be needed to reconstruct Afghanistan (see table 2). Others
    have estimated that much more is required. For example, the Afghan
    government estimated that it would need $15 billion for reconstruction
    from 2003 through 2007.

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

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

    (Billions of dollars)

    Level 1 year 2.5 years 5 years 10 years

    Low case $1. 4 $4. 2 $8.3 $11.4 Base case 1.7 4. 9 10.2 14.6 High case $2.
    1 $5. 5 $12.2 $18.1 Sources: Asian Development Bank, UNDP, and the World
    Bank. Note: Afghanistan Preliminary Needs Assessment for Recovery and
    Reconstruction (Tokyo: January 2002).

    In January 2002, donors pledged $5.2 billion for the reconstruction of
    Afghanistan for 2002* 2006, or slightly more than half of the base- case
    estimate for 5 years. 43 For the period January 2002* March 2003, the
    donors pledged $2.1 billion (see app. VII for donor pledges and
    donations). 44 As of March 2003, approximately 88 percent of the 2002
    grant funding had been disbursed. However, only 27 percent, or $499
    million, was spent on major reconstruction projects such as roads and
    bridges, which are essential for the export of Afghan agricultural
    commodities and the import of foreign agricultural supplies. Despite the
    importance that the United States and the international community attach
    to the Afghan reconstruction effort, Afghanistan is receiving less
    assistance than was provided for other recent postconflict, complex
    emergencies. For example, per capita assistance levels have ranged from
    $193 in Rwanda to $326 in Bosnia, compared with

    $57 for Afghanistan. Given that the livelihood of 22 million Afghans
    depends on agriculture, we estimated that if all of the assistance had
    been provided only to people engaged in agriculture, each person would
    have received $67 annually or about 18 cents per day for their daily
    subsistence and agriculture production efforts in 2002. If Afghanistan
    were to receive per capita aid consistent with the average amounts
    provided for other recent postconflict reconstruction efforts, in 2002 it
    would have received

    43 This figure was revised from $4.5 billion because of increases in
    pledges. This total included $3. 8 billion in grants and $1. 4 billion in
    loans. The initial pledge of $1.8 billion for 2002 was revised to $2.1
    billion.

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

    $6 billion in international assistance, and from 2002 to 2006 it would
    receive $30 billion, or nearly three times the base- case estimate.
    Funding May Be Inadequate to

    The funding proposed by donors for food security* related issues is
    limited Rehabilitate Agricultural Sector and may be insufficient to
    achieve the long- term goals of the Afghan government and the
    international community. Despite the Afghan

    government*s estimated annual need of $500 million for agricultural
    rehabilitation, agricultural assistance for Afghanistan in 2003 may total
    approximately $230 million. 45 Afghanistan*s President has emphasized that
    the goal of food security and political stability is the Afghan
    government*s overarching priority, and the United States and other donor
    governments

    recognize the strong link between stability and food security. According
    to the U. S. Department of State, reconstruction is an integral part of
    the campaign against terrorism: the U. S. policy goal in Afghanistan is to
    create a stable Afghan society that is not a threat to itself or others
    and is not a base for terrorism. Because the agricultural sector forms the
    core of the Afghan economy, the pace of the sector*s recovery will largely
    determine the rate of overall economic recovery. Sustained investment in
    the agricultural sector, particularly the rehabilitation, upgrading, and
    maintenance of the nation*s irrigation infrastructure, is essential for
    the recovery of the Afghan economy and the country*s long- term food
    security. 46 Despite improvements in agricultural production in 2002,
    owing

    primarily to increased precipitation, the fundamental weakness of
    Afghanistan*s agricultural infrastructure continues to threaten overall
    recovery efforts. 45 The international community has not published a
    figure for total agricultural assistance to

    Afghanistan. This estimate is derived from available Asian Development
    Bank, European Union, European Commission, UN, U. S., and World Bank data.

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

    The Ministry of Agriculture estimates that it needs $5 billion over 10
    years to complete 117 key projects and other efforts important for the
    recovery of the sector. Despite these costs, the 2003 Afghan development
    budget for natural resource management, including agriculture, is only
    $155 million. Since the budget is funded almost entirely by the donor
    community, the budget reflects what the government expects to receive from
    the international community, not the Afghan government*s actual need.
    Afghan government budget estimates indicate that the natural resources

    management budget will increase to $298 million in 2004 and $432 million
    in 2005. International donors have budgeted approximately $230 million for
    agriculture- related assistance in 2003. USAID considers adequate funding
    a prerequisite for the success of the assistance effort and plans to spend
    approximately $50 million on agriculture in 2003 and similar amounts in
    2004 and 2005. USAID funding covers 32 percent of the Afghan government*s
    2003 natural resources management program budget of $155 million but only
    10 percent of the Afghan Ministry of Agriculture*s estimated annual needs
    of $500 million. 47 Increased Terrorism, Warlords,

    The goal of a stable Afghan state is threatened by the rise in domestic
    and Opium Production Are Major terrorism, long- standing rivalries among
    warlords, and the rapid increase in Obstacles to Food Security and

    opium production. In March 2002, in a report to the UN Security Council,
    Political Stability the UN Secretary General stated that security will
    remain the essential requirement for the protection of the peace process
    in Afghanistan. One year later, in a report to the council, he stated that
    *security remains the most serious challenge facing the peace process in
    Afghanistan.* Others in the international community, including USAID,
    consider security as a prerequisite for the implementation of
    reconstruction efforts. In 2002 and early 2003, the deteriorating security
    situation was marked by terrorist attacks against the Afghan government,
    the Afghan people, and the international community. 48 These incidents
    have forced the international community to periodically suspend
    agricultural assistance activities, disrupting the agricultural recovery
    effort.

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

    48 Incidents included the attempted assassinations of the Minister of
    Defense and the President; the murder of an International Committee of the
    Red Cross staff member; rocket attacks on U. S. and international military
    installations; and bombings in the center of Kabul,

    at the International Security Assistance Force headquarters, and at UN
    compounds. There are approximately 4,900 International Security Assistance
    Force troops located in Kabul. These troops provide security only for the
    city of Kabul and the immediate vicinity.

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

    Another destabilizing force that affects agriculture is the illicit
    international trade in Afghan opiates. The drug trade was the primary
    income source of the Taliban and continues to provide income for
    terrorists and warlords. 50 On January 17, 2002, the President of
    Afghanistan issued a decree stating that the existence of an opium- based
    economy was a matter of national

    security and should be fought by all means. During the 1990s, Afghanistan
    became the world*s leading opium producer accounting for approximately 70
    percent of opium production worldwide. Despite being a central focus of a
    number of international donors engaged in Afghanistan, opium poppy
    eradication efforts implemented by the Afghan government and the
    international community in 2002 failed. In July 2002, one of Afghanistan*s
    vice presidents and leader of the Afghan government*s poppy eradication
    campaign, Haji Qadir, was assassinated. In October 2002, the UN Office for
    Drug Control and Crime Prevention estimated that, in 2002, Afghan farmers
    produced 3,400 metric tons of opium. 51 This level of production equals or
    exceeds levels achieved in 9 of the last 10 years. Total 2002 revenue from
    opium production totaled $1.2 billion, an amount equivalent to 70 percent

    49 USAID plans to spend $30 million in 2003 on demobilization efforts. 50
    In 2001, the United States estimated that the Taliban collected at least
    $40 million in taxes on opium. 51 UN Office for Drug Control and Crime
    Prevention, Geneva, October 2002.

    of total assistance to Afghanistan pledged for 2002, or nearly 220 percent
    more than the Afghan government*s 2003 operating budget. 52 The UN Drug
    Control Program also estimated that the average poppy

    farmer earned $4,000 dollars from growing poppies in 2002. Owing to
    continuing drought, a poor agricultural marketing structure, and
    widespread poverty, farmers have turned to poppy cultivation to avoid
    destitution. 53 Since the fall of the Taliban, irrigated acreage dedicated
    to wheat production has fallen by 10 percent, supplanted by opium poppies.

    In addition, it is estimated that 30 to 50 percent of Afghans are involved
    in opium cultivation. Many of the farmers continue to grow opium poppies
    because they lack the seed and fertilizer needed to grow alternative crops
    that generate revenues comparable to those from opium. 54 Conclusions The
    establishment of a new government in Afghanistan has provided the

    Afghan people, the international community, and the United States an
    opportunity to rebuild Afghanistan and create a stable country that is
    neither a threat to itself or its neighbors nor a harbor for terrorists.
    In 2002, U. S. and international food assistance averted famine, assisted
    the return of refugees, and helped to implement reconstruction efforts.
    However, U. S. food assistance and cargo shipping legislation limited the
    United States*

    flexibility in responding quickly to the emergency and providing support
    to WFP; the legislation does not provide for purchasing commodities
    regionally or donating cash to the UN for procuring commodities and
    requires that U. S. commodities be shipped on U. S. flag vessels.
    Consequently, the costs of food assistance were higher and delivery times

    were greater, fewer commodities were purchased, and a smaller number of
    people received food assistance. In addition, a lack of timely and
    adequate overall donor support disrupted WFP*s food assistance efforts.
    Meanwhile, in 2003, six million people will require food assistance in
    Afghanistan.

    52 The value of Afghanistan*s 2002 opium crops was equivalent to 17
    percent of its gross domestic product. 53 Although some poppy farmers are
    wealthy, many are poor farmers with just enough land and water for poppies
    but not enough resources to plant traditional or alternative crops. For

    many of these poor farmers, the decision to cultivate poppies causes moral
    anguish, as they regard its cultivation to be highly un- Islamic.

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

    Because the economy remains overwhelmingly agricultural, the pace of
    recovery in the agricultural sector will largely determine the rate of
    Afghanistan*s overall recovery. Food assistance alone cannot provide food
    security; Afghanistan*s agricultural sector must be rehabilitated.
    Environmental and political problems have limited the impact of the
    international community*s agricultural assistance efforts. In addition, in
    2002, the assistance efforts were not coordinated with each other or with
    the Afghan government. A new coordination mechanism established in
    December 2002 is largely similar to earlier mechanisms, and it is too
    recent

    for us to determine its effectiveness. Further, whereas U. S. and UN
    agencies, bilateral donors, and nongovernmental organizations have drafted
    numerous overlapping recovery strategies, no single Afghan government*
    supported strategy is directed toward the effort to rehabilitate the
    sector. Meanwhile, funding for the agricultural assistance effort is
    insufficient and the nascent Afghan government is plagued with problems
    stemming from domestic terrorism, the resurgence of warlords, and
    nearrecord levels of opium production. These obstacles threaten the
    recovery of the agricultural sector and the U. S. goals of achieving food
    security and political stability in Afghanistan.

    Matter for To increase the United States* ability to respond quickly to
    complex

    Congressional emergencies involving U. S. national security interests,
    such as that in

    Afghanistan, Congress may wish to consider amending the Agricultural
    Consideration

    Trade Development and Assistance Act of 1954 (P. L. 83- 480), as amended,
    to provide the flexibility, in such emergencies, to purchase commodities
    outside the United States when necessary and provide cash to assistance
    agencies for the procurement of non- U. S.- produced commodities. In

    addition, Congress may wish to amend the Merchant Marine Act of 1936, as
    amended, to allow waiver of cargo preference requirements in emergencies
    involving national security. These amendments would enable the United
    States to reduce assistance costs and speed the delivery of assistance,
    thus better supporting U. S. foreign policy and national security
    objectives.

    Recommendations for To increase the effectiveness of the agricultural
    assistance effort in

    Executive Action Afghanistan, we recommend that the Secretary of State and
    the

    Administrator of the U. S. Agency for International Development work
    through the Consultative Group mechanism to develop a comprehensive
    international* Afghan operational strategy for the rehabilitation of the
    agricultural sector. The strategy should (1) contain measurable goals and

    specific time frames and resource levels, (2) delineate responsibilities,
    (3) identify external factors that could significantly affect the
    achievement of goals, and (4) include a schedule for program evaluations
    that assess progress against the strategy*s goals. Agency Comments and

    We provided a draft of this report to WFP, Department of State, USDA, Our
    Evaluation

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

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

    agencies may provide cash or purchase food aid commodities outside the
    United States. However, we maintain that amending the Agricultural Trade
    Development and Assistance Act of 1954 to allow the provision of cash or
    food commodities outside the United States will greatly improve U. S.
    flexibility in responding to crises that affect U. S. national security
    and

    foreign policy interests. The act is the principal authority for providing
    food assistance in emergency situations. In both 2002 and 2003 over $2
    billion in food assistance, the preponderant amount of this type of
    assistance, was dispersed under this authority. Amending the act will
    provide the United States with more flexibility to respond rapidly and at
    lower cost to events that affect U. S. national security; this is
    particularly important given the number and magnitude of crises requiring
    food assistance and decreasing surpluses of U. S. commodities. We also
    agree with USDA that the cargo preference requirement adds additional cost
    to food assistance and should be waived in specific situations, and we
    have adjusted the matter for congressional consideration contained in the
    report on this issue.

    In its comments, USDA stated that the report did not provide enough
    evidence about the existence of surpluses in 2002 in the Central Asia
    region. It also stated that if the U. S. had procured greater levels of

    commodities with the savings accrued by purchasing regional versus U. S.
    origin commodities, the additional commodities would have over burdened
    WFP*s logistics system while generating only *marginal savings in time and

    money.* We have added additional information on the 7.6 million metric ton
    2002 grain surplus in Kazakhstan and Pakistan. We disagree with USDA*s
    assertions that additional regionally procured commodities would have

    taxed WFP*s logistics system and brought only marginal gains. In December
    2002, while fighting between coalition forces, the Northern Alliance, and
    the Taliban was still occurring, and winter weather was

    complicating food deliveries, WFP delivered 116,000 metric tons of food to
    Afghan beneficiaries, in the single largest movement of food by WFP in a
    1- month period. According to WFP, its Afghanistan logistics system was
    capable of routinely moving more than 50,000 metric tons of food per
    month. Further, we disagree with USDA*s statement that the potential
    savings in cost and time by purchasing commodities regionally are
    marginal. Savings from the elimination of ocean freight costs could have
    fed 685,000 people for 1 year, and commodities purchased regionally are
    delivered to beneficiaries within weeks of being purchased, compared with

    the 4 months that it can take for commodities purchased in the United
    States.

    WFP, the Department of State, USDA, and USAID all agreed with the report*s
    conclusion and recommendation pertaining to assistance coordination and
    the need to develop a joint international- Afghan agricultural
    rehabilitation strategy. WFP pointed out that although the

    international assistance effort may have been aided by better coordination
    in 2002, the overall level of assistance might have been too small in 2002
    to have any long- term impact on the agricultural sector. Although USAID
    agreed with our recommendation, it stated it did not want to lead the
    strategy development effort. We believe that USAID should take an active
    and aggressive role in the development of a joint international* Afghan
    government strategy, because the United States is the largest donor to
    Afghanistan, agriculture rehabilitation is the focus of USAID*s assistance
    effort in Afghanistan, and the achievement of U. S. goals in Afghanistan
    is

    tightly linked to the rehabilitation of the country*s agricultural sector.
    According to USAID*s assistance strategy for Afghanistan, restoring food
    security is USAID*s highest priority.

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

    delivered 116,000 metric tons of food to Afghanistan, a level of food
    assistance that exceeds any 1- month total for any emergency operation in
    WFP*s history.

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

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

    Loren Yager, Director International Affairs and Trade

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

    In addition, we analyzed project monitoring and loss data to determine the
    frequency of monitoring visits, the experience and education level of
    monitors, and the level of commodities lost versus those delivered. We did

    not verify the statistical data provided by WFP. We also reviewed donor
    resource contribution data for recent emergency and special operations. We
    contacted by e- mail, or spoke with, 14 Afghan and international

    nongovernmental organizations 1 to obtain their views on the delivery of
    assistance, WFP monitoring and reporting, and overall assistance
    coordination issues. We interviewed WFP management and staff at WFP
    headquarters in Rome, Italy; at the Regional Bureau for the Mediterranean,
    Middle East, and Central Asia, in Cairo, Egypt; at the Country Office in
    Kabul, Afghanistan; and at the Area Office in Hirat, Afghanistan. We also
    interviewed USAID, U. S. Department of Agriculture (USDA) and U. S.
    Department of State staff in Washington, D. C., and Kabul; U. S.
    Department

    of Defense Staff in Washington; the International Security Afghanistan
    Force, UN Development Program (UNDP), and UN Assistance Mission in
    Afghanistan (UNAMA) staff in Kabul; and UN High Commissioner for Refugees
    staff in Kabul and Hirat. Finally, we visited WFP project sites and
    warehouses in Kabul and Hirat. The number of sites visited was limited
    because of constraints placed on our movement within Afghanistan by the

    U. S. Embassy because of security considerations. We also examined cost
    data provided by USDA and USAID. The data included commodity costs; total
    ocean freight charges; inland freight;

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

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

    percent of the total value of the donated commodities. We calculated these
    data accordingly.

    We checked all USAID and USDA data for validity, where possible to the
    level of individual shipment. We cross- checked USAID data with USDA data.
    (USAID typically provided only estimated costs for commodities for the
    period 1999* 2002. Because USDA conducts almost all commodity purchases
    for USAID, USAID estimates the commodity costs at the time it places its
    order with USDA, based on the current market cost. However, because USDA
    provided actual costs for USAID purchases in 1999, 2000,

    and 2001, the USAID commodity costs we cited for 2002 are based on USAID's
    estimate.) We then compared the cost of the U. S.- purchased commodities
    with the cost of commodities purchased in the Central Asia region to
    determine whether any savings could have been realized by purchasing
    commodities regionally versus buying U. S. commodities.

    Finally, using the level of rations that WFP provides to returning
    refugees, 12.5 kilograms per month, we calculated the amount of food
    assistance that the United States could have purchased and the number of
    people that could have received food assistance if it had purchased
    commodities in the Central Asia region.

    Further, we examined the costs associated with the Department of Defense*s
    Afghan humanitarian daily ration program, implemented from October 2001
    through December 2001. Using the level of rations that WFP provides to
    returning refugees, 12. 5 kilograms per month, we calculated the amount of
    food assistance that the United States could have purchased and the number
    of people that could have received food assistance if it had purchased
    commodities in the Central Asia region.

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

    To assess U. S. and international agricultural assistance, coordination,
    strategies, and funding intended to help Afghanistan maintain stability
    and achieve long- term food security, we reviewed documentation provided
    by FAO, UNDP, and UNAMA; the World Bank; the Asian Development Bank;

    USAID; and the Afghan Ministries of Agriculture and Animal Husbandry, and
    Irrigation and Water Resources. We reviewed information pertaining to past
    and current coordination mechanisms in the Afghan government*s National
    Development Framework and National Development Budget. We examined the
    structure and content of the assistance strategies published

    by FAO, UNDP, UNAMA, the European Commission, the World Bank, Asian
    Development Bank, and USAID, and we examined the proposed funding levels
    contained in each strategy. Using the criteria contained in the U. S.
    Government Performance and Results Act, we examined the strategies to
    determine whether each contained the basic elements of an operational
    strategy articulated in the act. Further, we examined the overall
    assistance funding requirements contained in the January 2002 UNDP, World
    Bank,

    and Asian Development Bank Comprehensive Needs Assessment, which served as
    a guideline for international donor contributions for Afghanistan. We
    interpolated the funding projection data to construct annual aid flows,

    so that the cumulative totals were equal to those contained in the
    assessment. Assuming that the first year of data referred to 2002, we
    applied the U. S. gross domestic product deflator to convert the assumed
    current dollar figures into constant 2003 dollars.

    Further, we examined security reports produced by the Department of
    Defense and the UN, as well as the UN Office on Drugs and Crime report on
    opium production in Afghanistan, to determine the impact of warlords and
    opium production on food security and political stability. In addition, we
    discussed U. S. and international agricultural assistance efforts and food
    security issues with officials from USAID in Washington and Kabul; FAO in

    Rome and Kabul; UNDP and the Afghan Ministries of Communication, Foreign
    Affairs, Interior, Rural Rehabilitation and Development, and Irrigation
    and Water Resources in Kabul; and the Afghan Ministry of Agriculture in
    Kabul and Washington.

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

    World Food Program Projects in Afghanistan,

    Appendi I I x 2002 Type of project Description

    Free food distribution Free food is delivered to the most vulnerable
    populations. Supplementary feeding Malnourished children, pregnant and
    nursing mothers, and people undergoing treatment for tuberculosis and
    leprosy are provided with a blended mix of either milled

    corn and soy or wheat and soy, in addition to sugar and oil, through
    feeding centers, hospitals, clinics, and orphanages. Food for work
    Returning refugees, internally displaced persons, and people involved in
    the poppy

    industry, among others, reconstruct and rehabilitate irrigation canals,
    roads, and other infrastructure. The program provides wages in the form of
    food and tools.

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

    Food for education and support to teachers Food is distributed to students
    in school to encourage families to send their children to school. To
    encourage families to support the education of females, additional food is
    provided to female students. Food is also provided to teachers to
    supplement their low salaries. Food for training Food is provided to women
    who participate in informal education activities including technical
    skills and literacy training. Food for seed Food is exchanged for improved
    seed grown by contract farmers. The seed is then sold to other farmers.
    Urban and women*s bakeries Daily rations of bread are provided to more
    than 250,000 people. Women operate 41 of

    the 100 bakeries. Civil servant support Approximately 270,000 civil
    servants were provided with pulses and oil to supplement

    their salaries and help the Afghan government reestablish itself. Refugee
    and Food assistance is provided as part of a resettlement package to help
    people internally displaced person support reestablish themselves in their
    home areas or chosen community. Source: WFP.

    Description of WFP Food Assistance

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

    including stock, damage, and loss reports. WFP guidelines state that
    monitoring and reporting are essential parts of effective project
    management in the field, and it is WFP*s policy not to support any project
    that cannot be monitored. Monitoring activities are intended to assess the
    status of projects by comparing the actual implementation of activities to
    the project*s work plan. The responsibility for monitoring projects rests
    with the program*s country office in Kabul and five Afghan suboffices
    located in other cities. Each office employs between 6 and 24 local Afghan
    project monitors, 1 and WFP has 22 program staff in Afghanistan who also
    monitor projects, in addition to their other duties. WFP*s Afghan country
    office has developed monitoring guidelines for its monitors and monitoring
    checklists for each type of activity (e. g., food- for- work, food- for-
    seed, food- for- asset- creation, food- for- education).

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

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

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

    Donor Contributions to World Food Program Emergency Operation 10155 as of
    May 12,

    Appendi V I x 2003 Percentage Percentage Donor U. S. dollars of total Tons
    of total

    Total (appeal) 287,943, 598 100.00% 550, 171 100. 00%

    Australia 4,087, 975 1.42% 9, 567 1. 74% Belgium 985, 222 0.34% 2, 847 0.
    52% Canada 1,610, 097 0.56% 4, 662 0. 85% Denmark 3, 199, 194 1.11% 6, 648
    1. 21% EC* EuropeAid 21,897, 321 7.60% 63,834 11. 60% Faroe Islands 329,
    412 0.11% 897 0. 16% Finland 437, 445 0.15% 1, 303 0. 24% Germany 1, 985,
    560 0.69% 6, 497 1. 18% India 7, 444, 108 2.59% 9, 526 1. 73% Ireland 469,
    484 0.16% 1, 512 0. 27% Italy 8, 127, 321 2.82% 16,091 2. 92% Japan*
    private 442, 881 0.15% 1, 320 0. 24% Japan 17,818, 002 6.19% 45,436 8. 26%
    Korea, Republic of 40, 000 0.01% 109 0. 02% Luxembourg 490, 678 0.17% 1,
    466 0. 27% Netherlands 4, 374, 453 1.52% 13,288 2. 42% Norway 1,262, 626
    0.44% 3, 809 0. 69% Private 37,582 0. 01% 61 0.01% Switzerland 4, 039, 157
    1.40% 8, 918 1. 62% United Kingdom 5, 633, 701 1.96% 12,547 2. 28% United
    Nations 185, 000 0.06% TBD United States 156,385, 885 54.31% 309, 770 56.
    30% U. S. friends of WFP 172, 020 0.06% 195 0. 04% Multilateral funds 832,
    005 0.29% 1, 035 0. 19%

    Total (received) 242,287, 129 84.14% 521, 338 94. 76%

    Shortfall 45,656, 469 15.86% 28,833 5. 24% Legend EC = European Community
    WFP = World Food Program TBD = to be determined Source: WFP.

    Cost Data for U. S. Food Assistance to Afghanistan Provided to the UN
    World Food

    Appendi V x Program, Fiscal Years 1999* 2002 Administrative Commodity

    and cost Ocean freight Inland freight ITSH freight

    miscellaneous Total cost

    1999 $15, 069,555 $10,521,204 $815, 200 $756, 800 $1, 016,705 $28,179, 464

    53.48% 37.34% 2.89% 2. 69% 3.61% 2000 $18, 282,825 $12,234,100 $2,905, 600
    $3,874, 400 $1, 131,903 $38,428, 828

    47.58% 31.84% 7.56% 10. 08% 2. 95% 2001 $46, 866,434 $20,639,750 $3,313,
    900 $8,738, 300 $3, 294,616 $82,853, 000

    56.57% 24.91% 4.00% 10. 55% 3. 98% 2002 $75, 770,144 $34,920,586 $25,987,
    600 $39,896, 400 $1, 494,056 $178,068, 786

    42.55% 19.61% 14. 59% 22. 40% 0.84%

    Total $155,988,958 $78,315,640 $33,022, 300 $53,265, 900 $6, 937,280
    $327,530, 078

    Annual average 50.04% 28.43% 7.26% 11. 43% 2. 85% 100%

    percentage Percentage of total 47.63% 23.91% 10. 08% 16. 26% 2.12% 100%

    Legend ITSH = Internal Transport, Storage, and Handling Sources: GAO
    analysis of U. S. Department of Agriculture and U. S. Agency for
    International Development data.

    International Donor Assistance Coordination

    Appendi VI x Mechanisms in Afghanistan Between 1998 and 2003, as
    circumstances in Afghanistan changed, the coordination processes utilized
    by the international community and the Afghan government evolved (see
    table 3 and figure 11). Beginning in 1998, the international community
    employed a strategy of Principled Common Programming among United Nations
    agency, nongovernmental, and bilateral donor programs. The international
    community*s aim was to establish priorities and projects based on agreed
    upon goals and principles

    that would form the UN*s annual consolidated appeal for assistance. To
    implement Principled Common Programming, a number of coordination
    mechanisms were established, including the Afghan Programming Body. The
    programming body consisted of the Afghan Support Group, 15 UN
    Representatives, and 15 nongovernmental organizations and was responsible
    for making policy recommendations on issues of common concern, supporting
    the UN*s annual consolidated appeal for donor

    assistance, and promoting coordination of assistance efforts. 1 The
    Taliban government had no role in the programming body. The programming
    body was supported by a secretariat; working level operations were
    conducted by a standing committee and thematic groups responsible for
    analyzing needs, developing strategies and policies, and setting
    assistance priorities within their thematic areas (e. g., the provision of
    basic social services). The Afghan Programming Body and its standing
    committee were incorporated into the Implementation Group/ Program Group
    process established in

    2002. Table 3 describes the Afghan assistance coordination mechanisms in
    place in 2002.

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

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

    Date of formation/

    suborganization Responsibility Members comment

    Afghanistan Coordinate and mobilize international More than 60 countries,
    the November 2001 Reconstruction Steering reconstruction funds. European
    Union, the members of Group

    the G- 8, a the United Nations (UN), Replaced by the Consultative and the
    World Bank. Cochaired by Group (December 2002) and

    the United States, the European Afghanistan High- level Union, Japan, and
    Saudi Arabia. Strategic Forum (March 2003).

    Implementation Group Implement the strategy and policy of The Afghan
    government, World

    January 2002 the Afghan Reconstruction Steering Bank, UN Development
    Program, Group by facilitating coordination

    Asian Development Bank, Islamic Transformed into Consultative among the
    Afghan government,

    Development Bank, and the Group (December 2002).

    bilateral, multilateral, and Afghan Support Group b nongovernmental
    organizations

    implementing projects in Afghanistan.

    Implementation Standing Local working level coordination Afghan Assistance
    Coordinating April 2002

    Committee Authority, UN Assistance Mission in Afghanistan, donor
    Transformed into the governments, international

    Consultative Group Standing financial institutions, Committee (December
    2002) nongovernmental organizations

    Program Groups/ Further develop the 12 programs

    Afghan government and UN, April 2002

    Program Secretariats outlined in the Afghan government*s bilateral,
    multilateral, and National Development Framework. A nongovernmental
    organizations

    The Consultative Groups lead ministry guides each program

    replaced the existing Program group. Technical support is provided by
    Groups, and the Program a program secretariat led by a UN, Secretariats
    were replaced by multilateral, or nongovernmental the Consultative Groups*
    Focal

    organization. Points in December 2002.

    Afghan Assistance Coordinate the flow of international Afghan government
    February 2002

    Coordination Authority assistance in Afghanistan. (Afghan government

    agency) UN Assistance Mission in

    Coordinate all UN programs in All UN agencies working in March 2002

    Afghanistan Afghanistan. Afghanistan Regional/ UN aid coordination
    organizations in

    All UN agencies working in Late 1990s/ May 2002

    Provincial major regions of Afghanistan/ UN aid Afghanistan Coordination
    Bodies

    coordination organizations at the In 2002, the Afghan

    provincial level in Afghanistan government asked that the bodies realign
    along provincial lines.

    Sources: UN and Afghanistan Research and Evaluation Unit. a The G- 8 is
    comprised of Canada, France, Germany, Italy, Japan, Russia, the United
    Kingdom, and the

    United States. b The Afghan Support Group was founded in 1997 by the 16
    largest donor nations providing assistance

    to Afghanistan and the European Union. In January 2003, the group was
    dissolved and the Afghan government assumed responsibility for assistance
    coordination.

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

    In December 2002, the Afghan government instituted the Consultative Group
    coordination process in Afghanistan. The process evolved out of the
    previous Implementation/ Program group processes. (Table 4 compares the
    two processes.) The Consultative Group process retains the same basic
    hierarchical structure that was established under the Implementation Group
    process. 2 For example, the new process includes 12 groups, each

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

    lead by an Afghan government minister, organized around the 12 programs
    contained in the Afghan government*s National Development Framework. In
    addition to the 12 groups, 2 consultative groups covering national

    security programs (i. e., the national army and police); and 3 national
    working groups on disarmament, demobilization, and reintegration;
    counternarcotics; and demining were established. Further, 5 advisory
    groups were also established to ensure that cross- cutting issues, such as
    human rights, are mainstreamed effectively in the work of the 12
    consultative groups and reflected in the policy framework and budget.

    Each consultative group will assist in policy management, as well as
    monitoring the implementation of activities envisaged under the Afghan
    government*s national budget. The groups will assist in preparing the

    budget, provide a forum for general policy dialogue, monitor the
    implementation of the budget, report on indicators of progress for each
    development program, and elaborate detailed national programs. The groups,
    with assistance from the standing committee, will also focus on monitoring
    performance against benchmarks established by each group. Each lead
    ministry will select a focal point, or secretariat, organization

    from among donors and UN agencies. Each year, in March, the Afghanistan
    Development Forum, or national consultative group meeting, will be held to
    discuss the budget for the next fiscal year, review national priorities,
    and assess progress. At that time, the consultative groups will report to
    the Consultative Group Standing Committee.

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

    Based on Afghan National Ye s Ye s

    Development Framework Hierarchy  Afghanistan Reconstruction Steering
    Group  Afghanistan high- level Strategic Forum  Implementation Group

     National Consultative Group/ Afghanistan  Implementation Group Standing
    Committee Development forum  12 Program groups

     Consultative Group Standing committees  Additional subgroups

     12 Program Consultative Groups  1 Lead ministry per program group

     1 Lead ministry per program group  12 Program group secretariats led by
    a donor

     12 Program group secretariats led by a donor agency

    agency  2 National Security Consultative Groups  3 working groups  5
    advisory groups

    Leadership Afghan ministry leads each group. Afghan ministry leads each
    group. Membership Ministries, UN agencies, development banks, donor

    Ministries, UN agencies, development banks, agencies/ governments, and
    NGOs donor agencies/ governments, and NGOs

    Stated goals

    Assist in budget preparation Yes Yes Monitor performance of

    Ye s Ye s programs and subprograms Promote better coordination

    Ye s Ye s between all parties Formulate policy Not stated Yes

    Develop projects/ programs Yes Yes Prepare annual development

    Yes Not stated plan Set program

    Ye s Ye s benchmarks/ targets Sources: GAO analysis of UN and Afghan
    government data.

    Major Donors* Pledges and Contributions as of December 31, 2002 (as
    reported by the

    Appendi VI x I

    U. S. Department of State) Dollars in millions

    Tokyo conference Total disbursed Country pledge a Additional pledges for
    2002 Time frame

    Canada 62. 8 31.3 15 months France 24 32 Unspecified Germany 285 43 112 4
    years Italy 43 43.9 1 year Japan 500 282 2. 5 years United Kingdom 288 55
    77.5 5 years United States 297 600 Unspecified Russia b 30 Unspecified
    Austria 11.6 2. 4 10.7 1 year Belgium 30.7 11.5 Unspecified Denmark 59
    16.5 31.9 Unspecified Finland 28 10 12.1 4 years Greece 4.5 1 1.7 Ireland
    12. 3 9. 8 4 years Luxembourg 4.5 .1 3. 6 2.5 years Netherlands 63 5 78.9
    2. 5 years Norway 46. 6 10 47 2.5 years Portugal .8 Unspecified Spain 104
    6.4 77 Unspecified Sweden 90 31 4 years Switzerland 20 6. 7 Unspecified
    European

    864 78.4 133 5 years Commission Bahrain

    Kuwait 30 5 Unspecified Oman Qatar .1 Unspecified Saudi Arabia 220 72.5 4
    years United Arab Emirates 36 80 69.8 Unspecified Iran 560 32.7 6 years
    Australia 8.8 14.6 19 1 year South Korea 45 5 2.5 years Republic of China

    29 3 years (Taiwan)

    (Continued From Previous Page)

    Dollars in millions

    Tokyo conference Total disbursed Country pledge a Additional pledges for
    2002 Time frame

    Turkey 5 1. 8 2.9 5 years China 1 150 30 Unspecified India 100 31.7 One
    year Pakistan 100 17.7 Unspecified

    Total 3, 972.8 475 1, 949.95

    Source: Department of State. a Pledges and disbursements do not include
    those of the World Bank, Asian Development Bank, and

    other international nongovernmental organizations. b Russia did not pledge
    at Tokyo * Russian assistance has been primarily in- kind donations.

    Appendi VI x I I Comments from the World Food Program Note: GAO comments
    supplementing those in the report text appear at the end of this appendix.

    See comment 1.

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

    GAO Comments 1. Although changes in the coordination mechanism utilized in
    Afghanistan were introduced in 2003, the Afghan government and the

    international community still lack a common, jointly developed strategy
    for rehabilitating the agricultural sector. We believe that such a
    strategy, including measurable goals and a means to evaluate progress
    toward achieving the goals, is needed to focus limited resources and hold
    the international community accountable for the assistance it delivers.

    Appendi X I x Comments from the Department of State Note: GAO comments
    supplementing those in the report text appear at the end of this appendix.

    See comment 1.

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

    GAO Comments 1. The U. S. Agency for International Development (USAID)
    currently purchases limited amounts of regional food commodities in an
    effort to respond quickly to humanitarian emergencies. Commodities
    purchased in the United States by U. S. agencies must travel the same
    logistics networks as commodities purchased regionally. For example, U. S.
    commodities destined for Afghanistan in 2002 were shipped from the

    United States to the Pakistani port at Karachi and moved to their final
    destination via roads in Pakistan and Afghanistan. Commodities purchased
    in Pakistan followed the same transit routes. Hence, the overland shipping
    costs, such as for trucking, were the same for U. S.

    origin commodities and Pakistani commodities. Further, regional cash
    purchases of food would be made by U. S. government officials or World
    Food Program (WFP) officials, the same officials that currently handle
    hundreds of millions of dollars in assistance funds and millions of metric
    tons of commodities; we are not suggesting that cash be

    provided to local governments. Any purchases would be subject to U. S. and
    UN accountability procedures, as such purchases are currently; increasing
    the amount of commodities purchased locally would not by itself create an
    opportunity for corruption.

    Comments from the United States Agency for

    Appendi X x International Development Note: GAO comments supplementing
    those in the report text appear at the end of this appendix.

    See comment 1. See comment 2.

    See comment 3. See comment 4.

    The following are GAO*s comments on the letter from the United States
    Agency for International Development dated June 6, 2003. GAO Comments 1.
    We believe that the U. S. Agency for International Development

    (USAID) should take an active and aggressive role in the cooperative
    development of a joint international* Afghan government strategy because
    the United States is the largest donor to Afghanistan, agricultural
    rehabilitation is the cornerstone of USAID*s efforts in Afghanistan, and
    the success of U. S. policy goals in Afghanistan is tightly linked to the
    rehabilitation of the agricultural sector. According to USAID*s assistance
    strategy for Afghanistan, restoring food security is USAID*s highest
    priority. Consequently, agriculture assistance is one of USAID*s main
    strategic objectives in Afghanistan. Further, according to USAID*s Afghan
    assistance strategy documents, USAID*s overall assistance program is based
    on several critical assumptions about

    conditions in Afghanistan, one condition being that agricultural
    conditions do not deteriorate further. The document states that if these
    conditions do not prevail, USAID may not achieve its goals. We also
    recognize the importance of the Food and Agriculture Organization*s
    (FAO*s) involvement in the cooperative strategy development effort.

    However, donor support for FAO*s Afghanistan program has been limited.

    2. We agree that developing a broad- based agricultural rehabilitation
    strategy would have been difficult in early 2002, given the nascent nature
    of the Afghan government and the assistance coordination mechanism then in
    use. However, the government has been in place since June 2002, and the
    Consultative Group coordination mechanism was introduced in December 2002.
    Hence, we believe that the conditions now exist for the development of
    such a strategy. In

    addition, we have discussed the development of a joint Afghan*
    international community agriculture rehabilitation strategy with the
    Afghan Minister of Agriculture and FAO. Both support the idea and welcome
    the opportunity to develop such a strategy.

    3. No change to the title of the report is necessary. As stated in the
    report, agriculture is of central importance to Afghanistan*s economy and
    the livelihood of 85 percent of its citizens. Further, the link between
    food security and political stability is recognized by the international
    community not only in Afghanistan but also in other areas such as southern
    Africa. In addition, as stated above, USAID*s assistance

    strategy recognizes the importance of agriculture sector rehabilitation to
    the achievement of the U. S. policy goals in Afghanistan, including a
    politically stable state that is not a harbor for terrorists.

    4. We agree that other authorities allow USAID to provide cash or purchase
    assistance commodities outside the United States. However, we believe that
    amending the Agricultural Trade Development and Assistance Act of 1954 to
    allow the provision of cash or food commodities outside the United States
    will greatly improve U. S. flexibility in responding to crises affecting
    U. S. national security and foreign policy interests. The act is the
    principal authority for providing food assistance in emergency and
    nonemergency situations. Amending the act will provide a permanent
    provision in this authority allowing the United States to respond rapidly
    and in a cost- effective manner to events that affect U. S. national
    security.

    USAID cites the recently proposed $200 million Famine Fund as providing
    the flexibility that the United States needs to address humanitarian
    crises. However, the fund proposal indicates that the fund will target
    dire unforeseen circumstances related to famine; thus, the

    fund does not appear to be designed to respond to nonfamine crises
    involving large amounts of food aid or national security. The fund amounts
    to less than 10 percent of the $2.2 billion and $2.6 billion appropriated
    for U. S. food aid in 2002 and 2003, respectively, a period marked by an
    increasing number of humanitarian food crises* for

    example, in Afghanistan, southern Africa, and North Korea* that did not
    entail famine but that did, in some cases, affect U. S. national security.
    The Famine Fund is inadequate to respond to the increasing number and size
    of such crises. Meanwhile, the availability of commodities in the United
    States for food assistance has declined in 2003. Therefore, the need to
    procure commodities overseas in close proximity to affected countries has
    become more critical while also being more cost effective.

    Comments from the Department of

    Appendi XI x Agriculture Note: GAO comments supplementing those in the
    report text appear at the end of this appendix.

    See comment 1. See comment 2.

    See comment 3. See comment 4. See comment 5. See comment 6.

    See comment 1. See comment 7. See comment 8.

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

    GAO Comments 1. Although other legislation allows for the provision of
    cash or assistance commodities from non- U. S. sources, we believe that
    amending the

    Agricultural Trade Development and Assistance Act of 1954 to allow the
    provision of cash or food commodities outside the United States will
    greatly improve U. S. flexibility in responding to crises that affect U.
    S. national security interests. The act is the principal authority for
    providing food assistance in emergency and nonemergency situations.
    Amending the act will provide a permanent provision in this authority

    allowing the United States to respond rapidly and in a cost effective
    manner to events that affect U. S. national security. In addition,
    although the proposed $200 million Famine Fund may

    provide some additional flexibility for responding to humanitarian crises,
    the fund proposal indicates that the fund will target dire unforeseen
    circumstances related to famine. Thus, the fund does not appear to be
    designed to respond to nonfamine crises involving large amounts of food
    aid or national security. The fund amounts to less than 10 percent of the
    $2.2 billion and $2.6 billion appropriated for U. S. food aid in 2002 and
    2003, respectively, a period marked by an increasing

    number of humanitarian food crises* for example, in Afghanistan, southern
    Africa, and North Korea* that did not entail famine but that did, in some
    cases, affect U. S. national security. 2. We agree with the U. S.
    Department of Agriculture (USDA) that the

    cargo preference requirement adds additional cost to food assistance and
    should be waived in specific situations, and we have adjusted the matter
    for congressional consideration to reflect this. As stated in the report,
    19.6 percent of total food assistance costs in fiscal year 2002 were for
    ocean freight. These costs were incurred because of the requirement that
    assistance commodities must be purchased in the United States, and 75
    percent of the purchased commodities by weight

    must be shipped on U. S.- flagged carriers. In previous reports, we
    analyzed the costs of cargo preference requirements on food assistance and
    demonstrated the negative impact of these costs on U. S. food aid

    programs.

    3. Additional information has been added to the report describing the
    commodity surpluses available in the region in 2002. For example, in 2002,
    Kazakhstan harvested 16 million metric tons of wheat, a record

    harvest for that nation. Approximately 6 million metric tons of the 2002
    harvest was available for export. Similarly, Pakistan exported
    approximately 1.6 million metric tons of wheat in 2002. Consequently,
    these countries had nearly 7.6 million metric tons available for export,
    20 times the requirement for World Food Program*s (WFP*s) 2002

    emergency operation or 68 times the amount that WFP purchased from these
    two countries in 2002.

    4. All of the obstacles cited by USDA, including road closures due to
    snow, were concerns for WFP in 2002. We describe many of these obstacles
    in the report and also demonstrate that WFP was able to overcome the
    obstacles. The same transportation routes were used to move both
    regionally procured commodities and U. S. origin commodities. As noted in
    the report, in December 2002, while fighting between coalition forces, the
    Northern Alliance, and the Taliban was

    still occurring and winter weather was complicating food deliveries, WFP
    delivered 116,000 metric tons of food to Afghan beneficiaries, in the
    single largest movement of food by WFP anywhere in a 1- month period.
    Further, according to WFP, its Afghanistan logistics system was capable of
    routinely moving over 50,000 metric tons of food per month. Consequently,
    adding 103,000 metric tons or 8,600 metric tons per month to the total
    food moved over the course of 2002 would not have overburdened WFP*s
    logistics system. Further, the cost and time saved by purchasing
    commodities regionally are not marginal. As indicated in the report,
    purchasing commodities regionally could have substantially reduced the
    delivery time and the increased level of purchased commodities could have
    fed 685,000 people for 1 year. 5. Although all commodities may not be
    available regionally in all cases, in

    2002, Afghanistan*s greatest need was wheat, which constituted the bulk of
    the commodities delivered to Afghanistan that year. As stated in the
    report, if the United States had purchased wheat regionally, or provided
    WFP with cash to make regional purchases, the United States could have
    saved approximately $35 million in 2002. While our analysis describes how
    much wheat could have been purchased regionally with the savings, higher-
    value, consumer- ready commodities such as cornsoy blend from U. S.
    companies could have been purchased instead of additional regionally
    produced wheat. In either case, the United States

    could have provided a greater volume of commodities to Afghanistan if

    it had used the savings realized through the purchase of regional
    commodities versus U. S. commodities to procure additional commodities.
    Further, WFP has commodity quality control standards and would not
    purchase commodities with donor funds that were objectionable to the donor
    providing the funds. Finally, much of the wheat that was purchased in the
    United States was shipped in bulk to ports in Pakistan where it was bagged
    for final distribution in bags

    clearly marked *USA.* Wheat purchased regionally with U. S. funds was
    packaged in Pakistan in the same type of bags. Thus, any regional
    purchases could be packaged in appropriately marked bags in the country of
    origin or at a bagging facility in a transit country. WFP uses this
    practice in other regions, such as southern Africa.

    6. WFP made regional purchases during late 2001, but it also made regional
    purchases during 2002. As stated in the report, the amount of food
    available for food assistance in 2003 is less than in 2002, while the need
    for food aid continues to grow around the world, most notably in southern
    Africa. In addition, even if the U. S. grain infrastructure system is able
    to respond to ongoing demands for food aid, purchasing U. S. origin
    commodities and shipping the commodities via expensive ocean

    freight is not the most cost effective or quickest means either of
    supplying food to hungry people or of achieving U. S. national security
    and foreign policy objectives, such as stability in Afghanistan.

    7. We agree that the donor community faced challenges in engaging the
    Afghan government in 2002. We believe that the mechanisms currently in
    place, including the Consultative Group coordination mechanism,

    provide an environment where the international community and the Afghan
    government can engage in a joint strategy development effort.

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

    Appendi XI x I

    Comments from the Department of Defense Note: GAO comments supplementing
    those in the report text appear at the end of this appendix.

    See comment 1. See comment 2.

    See comment 3.

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

    GAO Comments 1. The report discusses both food assistance and nonfood
    assistance aspects of the Humanitarian Daily Ration program. On page 30 of
    the

    report, we state that the HDR program was initiated to alleviate suffering
    and convey that the United States waged war against the Taliban, not the
    Afghan people. Also, the HDR program is included with the U. S. Agency for
    International Development*s humanitarian programs in U. S. government
    tallies of total humanitarian assistance provided to Afghanistan.

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

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

    Appendi XI x I I GAO Contacts and Staff Acknowledgments GAO Contacts Phil
    Thomas (202) 512- 9892 David M. Bruno (202) 512- 7280 Staff

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

    (320108)

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    Report to Congressional Requesters

    June 2003 FOREIGN ASSISTANCE Lack of Strategic Focus and Obstacles to
    Agricultural Recovery Threaten Afghanistan*s Stability

    GAO- 03- 607

    Contents Letter 1

    Results in Brief 2 Background 5 U. S. and International Food Assistance
    Had Significant Impact and Was Well Managed, but Donor Support Was
    Problematic 13

    Agricultural Assistance Has Had Limited Impact and Lacks Coordination, and
    Major Obstacles Jeopardize Food Security and Political Stability 30
    Conclusions 46 Matter for Congressional Consideration 47 Recommendations
    for Executive Action 47 Agency Comments and Our Evaluation 48

    Appendixes

    Appendix I: Scope and Methodology 52

    Appendix II: World Food Program Projects in Afghanistan, 2002 56

    Appendix III: Description of WFP Food Assistance Monitoring Mechanisms 57

    Appendix IV: Donor Contributions to World Food Program Emergency Operation
    10155 as of May 12, 2003 59

    Appendix V: Cost Data for U. S. Food Assistance to Afghanistan Provided to
    the UN World Food Program, Fiscal Years 1999* 2002 60

    Appendix VI: International Donor Assistance Coordination Mechanisms in
    Afghanistan 61

    Appendix VII: Major Donors* Pledges and Contributions as of December 31,
    2002 (as reported by the U. S. Department of State) 66

    Appendix VIII: Comments from the World Food Program 68 GAO Comments 70

    Appendix IX: Comments from the Department of State 71 GAO Comments 73

    Appendix X: Comments from the United States Agency for International
    Development 74 GAO Comments 77

    Appendix XI: Comments from the Department of Agriculture 79 GAO Comments
    82

    Appendix XII: Comments from the Department of Defense 85 GAO Comments 86

    Appendix XIII: GAO Contacts and Staff Acknowledgments 87 GAO Contacts 87
    Staff Acknowledgments 87

    Tables Table 1: WFP Operations: Cash Donations, Food Donations, Number of
    Beneficiaries, and Percentage of U. S. Contribution, 1999* 2002 15 Table
    2: Projected Cumulative Funding Requirements for the

    Reconstruction of Afghanistan 42 Table 3: Major Assistance Coordination
    Mechanisms in

    Afghanistan in 2002 62 Table 4: Comparison of Implementation Group and
    Consultative

    Group Processes 65 Figures Figure 1: Map of Afghanistan, Including
    Provinces and Major

    Roads 7 Figure 2: Drought- Affected Areas in Afghanistan as of October

    2001 10 Figure 3: WFP Distribution of U. S. -Provided Food in Afghanistan
    12

    Figure 4: Road Conditions Faced by WFP Truckers in Afghanistan 18 Figure
    5: Use of Donkeys to Deliver Food to Remote Areas 19 Figure 6: Resource
    Requirements vs. Actual Deliveries for WFP

    Emergency Food Assistance Operation in Afghanistan, April 2002* January
    2003 22 Figure 7: Costs for U. S. Food Assistance to Afghanistan, Fiscal

    Years 1999* 2002 25 Figure 8: Humanitarian Daily Rations 29 Figure 9: FAO
    Irrigation Rehabilitation Project 32 Figure 10: Hierarchy of Strategies
    for Agricultural Sector

    Reconstruction 39 Figure 11: Organizations Responsible for Coordinating
    International

    Assistance in Afghanistan, 1998* 2003 63

    Abbreviations

    ACTED Agency for Technical Cooperation and Development FAO Food and
    Agriculture Organization HDR humanitarian daily ration ITSH Internal
    Transport, Storage, and Handling NDF National Development Framework UN
    United Nations UNAMA UN Assistance Mission in Afghanistan UNDP United
    Nations Development Program USAID United States Agency for International
    Development USDA United States Department of Agriculture WFP World Food
    Program

    This is a work of the U. S. government and is not subject to copyright
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    a

    GAO United States General Accounting Office

    The emergency food assistance that the United States and the international
    community provided from January 1999 through December 2002 helped avert
    famine by supplying millions of beneficiaries with about 1.6 million tons
    of food. However, the inadequacy of the international community*s
    financial and in- kind support of the World Food Program*s (WFP) appeal
    for assistance disrupted the provision of food assistance throughout 2002.
    Because of a lack of resources, WFP reduced the amount of food rations
    provided to returning refugees from 150 kilograms to 50 kilograms.
    Meanwhile, as a result of the statutory

    requirement that U. S. agencies providing food assistance purchase U. S.-
    origin commodities and ship them on U. S.- flag vessels, assistance costs
    and delivery times were higher by $35 million and 120 days, respectively,
    than if the United States had provided WFP with cash or regionally
    produced commodities. Had the U. S. assistance been purchased regionally,
    an additional 685,000 people could have been fed for 1 year.

    U. S.- provided vegetable oil distributed by WFP in Hirat, Afghanistan

    The livelihood of 85 percent of Afghanistan*s approximately 26 million
    people depends on agriculture. Over 50 percent of the gross domestic
    product and 80 percent of export earnings have historically come from
    agriculture. Over the 4- year period, because of continued conflict and
    drought, the international community provided primarily short- term
    agricultural assistance such as tools and seed. As a result, the
    assistance did not significantly contribute to the reconstruction of the
    agricultural sector. In 2002, agricultural assistance was not adequately
    coordinated with the Afghan government; a new coordination

    mechanism was established in December 2002, but it is too early to
    determine its effectiveness. As a result of the weak coordination, the
    Afghan government and the international community have not developed a
    joint strategy to direct the overall agricultural rehabilitation effort.
    Meanwhile, inadequate assistance funding, continuing terrorist attacks,
    warlords* control of much of the country, and the growth of opium
    production threaten the recovery of the agricultural sector and the U. S.
    goals of food security and political stability in Afghanistan. After the
    events of September 11, 2001 led to the defeat of the Taliban, the United
    States and the

    international community developed an assistance program to support
    Afghanistan*s new government and its people. Key components of this effort
    include food and agricultural assistance. GAO was asked to

    assess (1) the impact, management, and support of food assistance to
    Afghanistan and (2) the impact and management of agricultural assistance
    to Afghanistan, as well as obstacles to achieving food

    security and political stability. GAO recommends that the Secretary of
    State and the Administrator of USAID take an active role in an
    international* Afghan effort to develop an agricultural rehabilitation
    strategy.

    GAO suggests that Congress consider amending the Agriculture Trade
    Development and Assistance Act of 1954, as amended, and the Merchant
    Marine Act of 1936, as amended, to allow the purchase of commodities
    overseas and waive

    the U. S.- flag vessel requirement under certain circumstances.

    The agencies agree with the need to develop a strategy, but USAID does not
    think it should lead the effort. In terms of providing flexibility, WFP
    agrees, but U. S. agencies disagree with the need to amend legislation.
    www. gao. gov/ cgi- bin/ getrpt? GAO- 03- 607. To view the full product,
    including the scope

    and methodology, click on the link above. For more information, contact
    Loren Yager (202) 512- 4347 or yagerl@ gao. gov. Highlights of GAO- 03-
    607, a report to

    congressional requesters

    June 2003

    FOREIGN ASSISTANCE

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

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    Appendix I

    Appendix I Scope and Methodology

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    Appendix I Scope and Methodology

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    Appendix I Scope and Methodology

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    Appendix II

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    Appendix III

    Appendix III Description of WFP Food Assistance Monitoring Mechanisms

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    Appendix IV

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    Appendix V

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    Appendix VI

    Appendix VI International Donor Assistance Coordination Mechanisms in
    Afghanistan

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    Appendix VI International Donor Assistance Coordination Mechanisms in
    Afghanistan

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    Appendix VI International Donor Assistance Coordination Mechanisms in
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    Appendix VI International Donor Assistance Coordination Mechanisms in
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    Appendix VII

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

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    Appendix VIII

    Appendix VIII Comments from the World Food Program

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    Appendix VIII Comments from the World Food Program

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    Appendix IX

    Appendix IX Comments from the Department of State

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    Appendix X

    Appendix X Comments from the United States Agency for International
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    Appendix XI

    Appendix XI Comments from the Department of Agriculture

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    Appendix XI Comments from the Department of Agriculture

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    Appendix XI Comments from the Department of Agriculture

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    Appendix XII

    Appendix XII Comments from the Department of Defense

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    Appendix XIII

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