Afghanistan

Donors renew support for Afghanistan Reconstruction Trust Fund

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Brussels, March 18, 2003 - International donors1 today responded positively to a request from the Afghan Finance Minister to continue channeling funds through the Afghanistan Reconstruction Trust Fund (ARTF), saying they stand ready to support Afghanistan's rebuilding efforts for the long haul. Precise commitments to be made towards the $600 million requested by the Afghanistan government for the next fiscal year (March 21, 2003 - March 20, 2004) will be confirmed within the next few weeks.
The second ARTF donor meeting, organized by the World Bank, convened one day after the Afghanistan High-level Strategic Forum, which was hosted by the Afghan government and gathered the donor community to endorse a roadmap for rebuilding the country.

Since its formal inception in May 2002, the ARTF, managed by the Asian Development Bank, the Islamic Development Bank, United Nations Development Programme, and the World Bank, who is also the Fund's administrator, has evolved into a key instrument of support for the government's reconstruction and development strategy. It provides a mechanism for coordinated funding in line with agreed priorities of the government of Afghanistan.

Asked why donors were requested to support Afghanistan's reconstruction through the Fund, Finance Minister Ashraf Ghani said, "There is a big difference between a donor directly funding an implementing partner, such as an NGO, private organization, or a UN agency, to deliver a service, and a donor funding the ARTF, through which the government contracts the same implementing partner. In the latter case, the government structures and processes are strengthened, and the government gets the credit for service delivery, because it is the government who assures that services are provided to the community. This is a critical element in building a sustainable state which is key for lasting peace in Afghanistan."

By the end of this month, donors are expected to have paid in more than $208 million since the Trust Fund was activated. Of the $208 million, $148 million will have been disbursed for basic functions of government (including teacher and health worker salaries), and $44 million will have been committed for specific development projects. Examples of approved projects include an emergency employment program that creates jobs across the country to rehabilitate rural roads and irrigation systems using labor-intensive methods, a project providing microloans to low-income women, and a feasibility study fund to prepare and supervise projects that have been prioritized by the government.

"The use of a multi-donor Trust Fund as a key instrument of support to reconstruction is saving the Afghan government a huge administrative burden. In its absence, the government would have to deal with multiple donors, each requiring their own agreements, fund flow mechanisms, procurement, accounting, audits, and reporting arrangements," says Alastair Mckechnie, World Bank Country Director for Afghanistan.

Contact: In Washington: Zita Lichtenberg: (202) 458-7953, Email: zlichtenberg@worldbank.org
In Kabul: Abdul Raouf Zia (93) 70-27-9184, Email: azia@worldbank.org

For more information on the World Bank's activities in Afghanistan, please visit: http://www.worldbank.org/af

For more information on the Afghanistan Reconstruction Trust Fund, please visit: http://www.worldbank.org/artf

1 The 22 donors are: Bahrain, Canada, Denmark, European Commission, Finland, Germany, India, Ireland, Italy, Japan, Kuwait, Luxembourg, Netherlands, Norway, Portugal, Saudi Arabia, South Korea, Sweden, Switzerland, Turkey, United Kingdom, United States.