Fraser Institute – Ottawa May 8, 2007
Remarks by Amb. Omar Samad
Thank you… for this invitation to the 3 rd annual Fraser Institute
I am sorry to inform you that I will not be discussing the detainee transfer issue tonight.
Instead, I will dutifully use my 15 mins of Fraser Inst. fame here to talk about Afghanistan’s economic and development issues, new opportunities and the various challenges we face. I will also refer to trade and market dynamics in our region and beyond, to which the Afghan government has and continues to pay a lot of attention.
We believe that Afghanistan’s new-found liberty and freedoms since the end of 2001 when the Taliban-Al Qaida regime was ousted by Afghan and coalition forces, has not only ushered a young democracy and constitutional order, media freedoms, and fundamental changes in the lives of ordinary Afghan men, women and children, but also economic freedoms that are unprecedented. The media here may be focusing on the insurgency in the South, but most of Afghanistan is experiencing post-conflict economic boom and growth.
Long before what is now referred to as globalization, for thousands of years, our region and our people have engaged in trade and business. From the silk route to the spice route, and even today the poppy route unfortunately, this land known today as Afghanistan, has been a crossroad and a land-bridge connecting people and products form South Asia to Central Asia and the Far East, to the Middle East and beyond.
That is why, without stability and growth-oriented economic pillars in Afghanistan, the whole region suffers, and potentials and opportunities go to waste. When we have security and a stable environment, the whole region prospers and benefits from it.
As a failing state emerged in the late 1970s when a communist coup led to a brutal Soviet invasion, a decade of war and destruction, the death of over a million Afghans, a brain-drain and exodus of millions of our people, followed by a strategic mistake of world, when powers turned away from Afghanistan instead of rebuilding it in the 1990s, followed by civil strife instigated by regional rivalries and the rise of radical Islamic militants, we fell into the hands of the most repressive extremists known as Taliban until terrorism struck targets far and wide culminating in the tragedies of 9/11. Only then did the world realize that Afghanistan needs to be put back together according to the wishes of its own people and that we cannot afford to create such a dangerous vacuum again.
Today Afghanistan is still fragile in many respects because we did not finish the job of dismantling the Taliban and Al Qaida as violent militant forces. They went to their sanctuaries across our borders, where the breeding ground exists for such radicalization, and since 2002 regrouped, found sources for funding, arms, training and recruitment with the help of the same parties that provided guidance since the 1980s. This phenomenon poses the most severe threat to our attempts at stabilizing and rebuilding the country.
It is also fragile because we are still working on integrating into civilian life the armed groups that pose a threat to democracy and human rights values. We are still facing a grave threat from the poppy and drug business. Our people are still waiting to see the peace dividend in terms of jobs, reconstruction, institution and capacity building, governance and rule of law.
Rebuilding Afghanistan is a joint venture. One of the largest multilateral engagements ever seen. Under a UN mandate about 40 nations are helping on the security front and many more on the development and rehabilitation side. The Afghanistan Compact signed with more than 60 donors in London in 2006 is the blueprint for development, security, governance and rule of law pillars for the next 5 years. The world pledged more than $ 10 billion to fund the benchmarks of this compact.
Our macroeconomic indicators are positive and growing. GDP grew at 8% last year and is expected to exceed 10% this year, while inflation is contained at 5%. We do not have accurate unemployment statistics but it is an area of concern, we need to put more Afghans to work through mid to large-scale infrastructure and public works projects, and through a revitalized private sector. Domestic revenue collections have increased 500% since 2002 and we have built up capacities to spend more than 66% of the development budget last year, up from the 50% spent the year before. The Afghan currency is stable.
Through Paris Club negotiations, we have reduced Afghanistan’s long-standing debt through debt relief, especially from Russia, Germany and the US, amounting to more than $10 billion. The IMF and WB boards recently declared Afghanistan eligible for soft loans under the Heavily Indebted Poor Countries Programme (HIPC).
Afghanistan continues to maintain favorable performance on the Poverty reduction and Growth Facility programme with the IMF through fiscal prudence and economic reform.
Some areas of concern include the need for additional resources for development, funding for the recurrent budget, aid effectiveness, capacity building, anti-corruption and dealing with employment problems during this transition to a freer economy.
Trade with neighbors and others has seen a surge, especially in terms of imports. Direct foreign investment, facilitated by new investment laws, is also on the upswing, with more than $5 billion invested in the past years. We are now opening Afghanistan to larger investments such as in mining, industrial plants and large-scale infrastructure.
The government has identified several high level objectives that need sustained international assistance:
- expansion of energy sources and supplies
- Investment in human capital in various fields through capacity building measures.
- Completing a national road system
- Transforming agriculture to fight poverty
- providing adequate housing
- reforming public administration
- Managing and developing water resources
Ladies and gentlemen,
…Let me talk for a minute about Canada’s role in Afghanistan and the work of Canadians, the brave men and women of the Forces, diplomats, NGOs and others in helping us secure and rebuild Afghanistan… Afghans will never forget those who paid the ultimate sacrifice for a worthwhile and noble cause…
There is lot to talk about when addressing nation and state building. These are some of the reasons why Afghanistan matters. Inaction or premature withdrawal will not only disrupt the process underway, but also will also take us back to the times when the world walked away and Afghanistan fell into the wrong hands. In the same way that rebuilding Afghanistan on the cheap with a light footprint could have negative repercussions and a loss of hope, failure is not an option. The Afghans overwhelmingly support reform and progress, and the insurgency is not popular. Now is the time to take a strong stance, and collectively invest in success to secure and rebuild Afghanistan. |
