Foreign aid to Afghanistan could reach $12 billion over four years, some with conditions

Foreign donors pledged a projected $12 billion in civilian aid to Afghanistan over the next four years at a conference on Tuesday, but many made it conditional on protecting human rights and making progress on peace talks in a major shake-up for the country’s economy.

Ville Skinnari, Finland’s minister for development cooperation and foreign trade whose government co-organised the conference, said donors had pledged $3 billion for next year, with annual commitments expected to continue at roughly the same level through to 2024, adding: “This would amount to $12 billion.”

That preliminary figure was a drop from $15.2 billion pledged in 2016 for four years, despite coming at a time when Afghanistan’s needs are growing due to rising violence and the coronavirus pandemic.

Many donors also put strict conditions on future funding and some officially committed for just the next year. Diplomats said keeping financing for Afghanistan on a tight leash could provide foreign governments with some leverage to inject a greater sense of urgency into a halting peace process.

The United States said it had pledged $300 million in civilian aid to Afghanistan next year and would make available another $300 million based on progress in peace talks.

“We stand ready to support Afghanistan and to that end we’ve made available $600 million for civilian assistance needs in 2021. We’re pleased to pledge today $300 million of that money with the remaining $300 million available as we review progress in the peace process,” U.S. Under Secretary of State for Political Affairs David Hale said via video link at the conference in Geneva.

The United States has contributed roughly $800 million a year in civilian aid in recent years.

Another top donor, Germany, pledged 430 million euros ($510.88 million) in 2021 and signalled it would keep contributing until 2024 but also stressed that progress towards ending almost 20 years of war was needed.

Talks in the Qatari capital Doha between the Afghan government and Taliban insurgents began in September but have been mired in procedural wrangling as violence has resurged around the country.

But Hale said “significant progress” had recently been made, including a tentative agreement on ground rules that could allow negotiators to proceed to the next stage of forming an agenda.

Afghanistan’s Foreign Minister Mohammad Haneef Atmar said the “legal basis” for talks was one issue that still had not been resolved, though he expected progress soon. Officials have previously told Reuters the main dispute is over whether a February U.S.-Taliban agreement should form the basis of talks.

As the donors conference proceeded, two explosions rocked an outdoor market in the central province of Bamyan, usually considered one of Afghanistan’s safest areas, killing at least 14 people and wounding 45, mostly civilians.

COVID-19 uncertainties

During the lead-up to the quadrennial donors conference, diplomats reckoned Afghanistan could receive 15-20% less funding than at the last conference in 2016 due to uncertainties over the peace process and difficulties securing commitments from governments financially strapped by the coronavirus pandemic.

The Afghan government welcomed the result with Atmar calling it a success and saying the strict conditions would help focus peace negotiations.

But economists and some diplomats were concerned, saying even in the best-case scenario, the amount would only just stretch to maintain basic public services at a time of dire need.

“Conditionalizing the aid on the peace process means that it is being used as a political instrument,” said Omar Joya, chief economist at the Kabul-based Biruni Institute. “We suggest that the donors make all efforts to ensure aid predictability for the next four years so that basic public services such as health and education are delivered uninterrupted at a critical time.”

Uncertainty over whether the compromises needed for peace might lead to backsliding on human and women’s rights has added to some countries’ wariness about making long-term commitments to an Afghan administration, which needs foreign money to cover about three-quarters of its spending.

The European Union pledged 1.2 billion euros ($1.43 billion)over four years but emphasised aid was conditional.

“Afghanistan’s future trajectory must preserve the democratic and human rights gains since 2001,” EU foreign policy chief Josep Borrell said.

“Any attempt to restore an Islamic emirate would have an impact on our political and financial engagement,” he added, referring to the Taliban’s previous hardline Islamist rule.