Excellencies, Ladies and Gentlemen and distinguished delegates.
Let me begin by acknowledging the accomplishments that have been made. There is a great deal that is going right in Afghanistan.
It has been said that the fact that we are having this conference in Kabul is evidence of this. I agree. It is symbolic of Afghanistan’s desire to control its own future. Afghanistan has invited the world in to see what they have achieved. The cluster process, which is the basis for this Conference, is an impressive exercise in development planning and implementation and we should support it. All of us who have been in Government realize how difficult it is to make trade-offs and set priorities when the needs of a country are so great. The World Bank is happy to have been a partner with the Government. We have managed for our own account and for the Afghanistan Reconstruction Trust Fund (ARTF) some $5 billion in assistance to Afghanistan since 2002.
The Government has improved its revenue generation and the essentials of a public financial management system are now in place. Last year, under the leadership of Minister Zakiwahl and the Ministry of Finance, Government generated revenue reached 8.9% of GDP, surpassing its target of 7.4% and representing an increase of 28% on the previous year. This gives hope that over the long-term Afghanistan can increasingly finance itself and reduce donor dependence.
Afghanistan’s rich mineral resources offer a tremendous source of growth, employment and revenue for the current and future generations. Its potential, however, will only be realized if development is done in a transparent and equitable way and with a commitment to social and environmental safeguards that protect and benefit the communities where these resources are located. Improved regional transport links and trade will likewise be necessary to get Afghanistan’s minerals (and other goods) to global markets.
Laws and systems are necessary to protect this birthright of the Afghan people from being wasted or captured by special interests. I congratulate Minister Sharani on the steps that they have taken. Just 2 days ago, the Government published its mining contracts in local newspapers and on the internet so that people can see exactly what is being done with the country’s resources.
Successful national programs are delivering. A nation-wide basic health program is active in every province. The training of female community health care workers is saving the lives of women and children and demonstrates, in a very tangible way, that women matter. In education, school enrolment is now the highest in Afghan history and Government is turning its attention to education quality. To date, the lives of over 18 million Afghans have been touched by the National Solidarity Program and the $1.5 billion roll-out of the program just approved by the World Bank’s Board has just approved will enable the Government to reach every rural community in the country. This is powerful!
Now let me focus briefly on the significant challenges.
First, the first national poverty profile completed by the Bank and the Afghan Government shows about 9 million Afghan people, or 36% of the population, are not able to meet their basic consumption needs. Poverty is spread throughout the country – and often the worst levels of poverty are in the areas of least conflict. This is an important finding. Donors need to ensure that assistance is equitable and effective over the long-run. Short-termism and an over-emphasis on insecure parts of the country too often feeds corruption and undermines Afghan trust because it neglects those people in more stable regions who are facing dire levels of poverty.
Clearly corruption remains a major concern. The World Bank fully supports Government’s call to donors to hand over the reins of development spending in Afghanistan by putting more of its money through budget. At the same time, concrete improvements in governance will be necessary to give donors the assurance that tax-payers’ money is being well spent. One example is that the good Public Financial Management roadmap presented today must be fully implemented.
Finally, let me say a few words on partnership. On behalf of Bob Zoellick, the Bank’s President, I want to express our deep appreciation to the donors for their continued support for the Afghanistan Reconstruction Trust Fund. It is a proven and reliable means for putting donor funds on budget in a transparent and accountable way. It demonstrates what donors and Government can achieve when working together with a common purpose. But in other ways, we could do better.
As a former Finance and Foreign Minister of Nigeria, I know that development is measured not in months, but in years and even decades. So in any country, we must always remind ourselves to be realistic and pragmatic. We must also be careful that our impatience does not harm what is already working well. Let us not load on good programs demands that they cannot deliver.
The World Bank is here for the long-haul, but this commitment comes with clear expectations that a more selective and achievable set of benchmarks will be measured and monitored. The idea is to use this to drive results. I propose that we think long and hard before having more conferences until we are sure of seeing more results. As donors we should put our support fully behind reform and good leadership. Donors should not, however, usurp the responsibility from Afghan institutions nor set unrealistic time frames. Reform is possible in Afghanistan – one only need to look at the progress at the Ministries of Finance, Health and Education, Communications, the Central Bank. It is not unreasonable to set performance benchmarks against which Government can be judged. The people of Afghanistan deserve nothing less.
Thank you, Mr. Chairman, for the opportunity to address this Conference.