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Afghanistan: The Way Forward. (Global Insights)

Since the rout of the Taliban, after two and a half decades of nearly continuous conflict, Afghanistan has embarked on a complex triple transition: from war to peace; from a repressive, militaristic theocracy to a society based on democratic principles, the rule of law, and respect for human rights; and from a state-controlled, war-torn economy to private sector-led economic development. This postconflict transition (PCT) will take many years. In the short run, the heart of this transition is the daunting challenge of economic reconstruction. Economic reconstruction entails various and complex tasks, including strengthening internal security; rehabilitating a dilapidated physical infrastructure; building formal economic institutions and a legal system that respects property rights; and promoting employment-generating growth as a basis for poverty alleviation. Accomplishing these tasks, while simultaneously attending to the basic needs of large segments of the Afghan population, requires a framework of macroeconomic stability (consistent fiscal, monetary, and exchange rate policies) and good governance (good, fair, and transparent allocation of resources). A great deal rides on the success--or failure--of Afghanistan's economic reconstruction. Without rebuilding, and establishing a simple policy framework to attract foreign capital and support private initiative, Afghanistan's chances of getting into a sustainable development path are slim. Without rapid and broad-based improvement in the appalling living conditions of the Afghan population, peace and political stability in Afghanistan, and indeed in the entire region, will be elusive. Afghanistan: A Sovereign Country As a sovereign country Afghanistan must be in charge of its own destiny. But as a very poor society destroyed by foreign forces (rather than by civil conflict alone) and subject to continuous meddling by its neighbors over the last quarter of a century, Afghanistan has had little latitude to chart its development path or formulate policies for managing its economy. Given the legacy of interference in Afghanistan, outside powers now have a major responsibility to put things right and to assist in the economic reconstruction of the state. This will require providing adequate funding as well as technical assistance and training as needed, but it should not mean taking over the process of policymaking. To be successful, Afghan ownership of the reconstruction strategy is critical. Afghanistan's own leaders have to be involved in the strategy design and in the setting of priorities. Further, the Afghan population at large must believe in the reconstruction effort and be willing to support the tough policy decisions necessary to implement it. History has taught us that the Afghan people are fiercely independent. A solution to their problems cannot be imposed from abroad. Will donors understand and accept this simple fact? It may be difficult for bilateral and multilateral donors, as well as for nongovernmental organizations (NGOs), to take the backseat in Afghanistan given recent precedents. The inherent dangers of proceeding in Afghanistan as in Kosovo and East Timor are real, but the situations are quite different. The latter two were not independent countries when they embarked on their PCT, and the Security Council put the UN "in charge" of economic reconstruction. In fact, in both places, the Security Council mandated the Special Representative of the Secretary-General (SRSG) to exercise all executive and legislative powers through the issuance of regulations. Under such conditions, donors enjoyed pretty much a free hand in carrying out their activities, usually after receiving a green light from the UN to do so, but often even without it. The temptation for donors to do things in their own way (without serious consultation with the government) may be especially strong i n Afghanistan, where they have developed the habit of doing so in the past. …