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KABUL, 16 March (IRIN) - Afghanistan's minister of finance announced on Friday that US $ 350 million dollars were needed from donors to meet the government's annual budget of $550 million. "Funding the ordinary budget will require $550 million, of which $200 million is anticipated to come from domestic revenue and $350 million from donor financing," Ashraf Ghani Ahmadzai told IRIN at the end of a two-day meeting of the Afghanistan Development Forum (ADF)attended by senior government officials and international donors in the capital Kabul.
He also outlined a medium-term requirement of $1.7 billion for the country. "We have also presented an ambitious 1.7 billion dollars developmental budget and thus far have received pledges of 712 million dollars leaving a gap of one billion dollars," he said.

He was upbeat about Kabul's ability to manage donor money, saying the needs of Afghanistan were great and to spend money credibly and efficiently, attention had been focused on preparing projects and programmes that would be affordable and sustainable.

"Our success in reforming the currency should be an indication that when the nation is united and the cabinet determined, difficult reforms can actually be achieved within a time that the international community would consider efficient," Ahmadzai said mentioning that the government would redouble its efforts in the area of financial management over the entire country.

The process of budget preparation has been intensive over a period of several weeks, with government ministries working in groups and with donors, through a consultative process. Senior donors and UN representatives who participated in the meeting seemed satisfied with the way the budget was prepared and presented. "I think it was considerable progress, because this time I know there was hard bargaining within the cabinet to negotiate the budget to each ministry," Deputy Special Representative for Secretary General, Nigel Fisher told IRIN in Kabul.

He called on the international community to rise to this challenge. "We have to fulfill our commitments, and promises have to be translated into disbursements now," Fisher said emphasising donors should not wait until later in the year to make money available for Afghan reconstruction. "The period between March and October is the best time for undertaking activities in Afghanistan, " We should not spend a lot of time in discussing priorities and planning," he remarked.

Fischer said the role of the UN system was to adapt its programmes to national priorities. Asked if the development budget outlined by the Afghan government was acceptable to the donor community, Fisher said the budget of around $2 billion was not very much. "The international financial institutions in the United Nations last year said Afghanistan needed between thirteen and nineteen billion dollars over the next few years," he said.

Many observers are concerned that a possible war in Iraq will result in donors being less forthcoming with money for Afghanistan. "I think it is going to take much more work this year to make sure the donor community makes its commitment," he said. The peace process in Sri Lanka, as well as famine and drought in Ethiopia and southern Africa may also mean less donor cash for Kabul.

An international conference dubbed "Rebuilding Our Nation: Afghanistan High-Level Strategic Forum" will be held in Brussels on Monday. President Karzai and Afghan ministers, representatives from the European Union (EU), Iran, Pakistan, the World Bank and the US Agency for International Development (UNAID) will be participating in the one-day meeting which the European Commission is co-hosting with the World Bank.

The forum will take stock of progress on rebuilding Afghanistan, and will focus on support from the international community, security and rule of law, trade and investment and humanitarian issues. EU Commissioner for External Relations Chris Patten is expected to sign a 400-million-euro package of reconstruction support to Afghanistan at the meeting.

[ENDS]

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