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Afghanistan after 2014
The final election results in Afghanistan will not be announced till May 14th. It is a hopeful sign that both the leading candidates in the race for the presidency seem reconciled to a run-off election, accepting that neither will get a clear majority from the votes cast on April 5. Both seem to agree, at least at this time, that the Independent Election Commission and the Election Commission will handle the approximately 1,570 complaints of electoral irregularities in a competent and fair-handed manner. The run-off election should be held before the end of May and a new President (my educated guess is Dr Ashraf Ghani) should assume office by June/July.
Both candidates are committed to signing, post-haste, the Bilateral Security Agreement (BSA) with the United States. We can, therefore, assume that by end July, there will be a BSA in place. President Obama will probably announce a residual military presence of 12,000 of which 8,000 will be Americans and the rest from Isaf partners. There may well also be a reiteration of the pledges for military ($4.1 billion annually) and economic assistance ($4 billion annually) made at the Chicago and Tokyo conferences. While the elephant in the room is, of course, reconciliation with the “armed opposition”, the rest of this column will try to identify the other problems that the new administration will have to contend with. Many of these issues will, of course, become less pressing if reconciliation is achieved quickly. Up to 2013, the US had provided $96.5 billion in assistance to Afghanistan of which 56.5 billion was military assistance. For 2014, the aid level is $5.42 of which $ 4.72 is military, leaving about $700 million available for economic assistance. For 2015, the Obama Administration has proposed an aid level of $2.6 billion. If $2 billion is kept for the military as pledged in Chicago, there will be only $600 million for economic assistance. If the ANSF is to be maintained at the 352,000, a further $2 billion will be needed annually. Will it be forthcoming? Will the US be able to provide its share — usually 50 per cent of the $4 billion a year pledged at Tokyo by all donors? Will the new administration be able to meet the accountability requirements of the Tokyo agreement? Will the problems of administrative capacity and corruption persist? At Chicago, the Afghan side had committed to providing $500 million for the Afghan National Security Forces (ANSF) from its own resources. In 2013, the total revenue of the Afghan state was 48 billion Afghanis (less than a billion dollars) as against 54 billion in 2012. This revenue sufficed to meet only 10 per cent of the Afghan government’s expenditure with the remaining being foreign assistance (64 per cent American and 26 per cent others). Can this budget permit spending $500 million on the ANSF without cutting down not only on development expenditure but also on the maintenance of education and health facilities created over the last few years? Agriculture provides 20 per cent of the Afghan GDP but employs some 79 per cent of the population. The services sector, on the other hand, employs less than 16 per cent of the population but generates some 54 per cent of GDP. This sector, which has enjoyed a boom during the presence of foreign forces, is going to suffer a severe downturn, particularly among the younger more educated urban dwellers. How will the government support them? Afghanistan’s economy is dependent on imports for many requirements, including food. According to official figures, in 2012 Afghanistan’s total imports were $6.39 billion against exports of just $376 million. How will this gap be filled when foreign aid dwindles? Afghanistan has a substantial black economy — opium cultivation and unrecorded exports of timber and chromite and other minerals — but even so, the economic situation will be parlous and the new administration’s capacity to cope will be limited. Afghanistan’s neighbours, particularly Pakistan with its long porous border, must prepare to cope with the severe economic distress that is inevitable in post-2014 Afghanistan. |
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Afghanistan: the worst case scenario
It helps to develop the worst-case scenarios on which public policy choices can be made. This is done frequently by economists to prepare for low-probability events if they do happen to occur. Nassim Taleb in his well-known book Black Swan (Random House, 2007) wrote about the need to build institutional capacity to handle low-probability events if they do materialise. His book was published about the time the West and then the rest of the world was about to plunge into what has come to be called the Great Recession of 2007-09. Very few analysts had seen the sharp downturn coming. When it came, policymakers in Washington and the capitals in Western Europe were not well prepared to handle the crisis.
Islamabad needs to apply the same line of thinking to the rapidly evolving situation next door in Afghanistan. Elections were held in that long-troubled country on April 5 but the results would not be known for weeks –– perhaps even for months –– to come. If no candidate wins more than half the number of votes cast, a run-off contest will take place. According to initial readings, the two top candidates are likely to be Ashraf Ghani, a Pashtun, and Abdullah Abdullah, a Tajik. The runoff between Ghani and Abdullah could take the form of a contest between two powerful ethnic blocs that have competed with each other ever since the fall of the Taliban regime in 2001. Abdullah represents the ethnic groups that have strong links with the Central Asia states, once dominated by the Soviet Union. The Pashtuns in the south and east of the country have a larger number of their ethnic group living in Pakistan. These two ethnic groups have opposing interests. The Tajiks, the Uzbeks and other non-Pashtun groups have done better economically during the period President Hamid Karzai was in charge. They were also more accommodating of the other minorities in the country, including the Shia Hazaras. The Pashtun population, while accounting for the largest share of the ethnically-divided country, has done less well. It has strong antipathy towards the Shias and generally resents the way it was treated by the Karzai administration. An electoral battle between the two groups will be part of the worst case scenario that can be envisioned for Afghanistan. It becomes even grimmer if this ethnic battle draws in the newly assertive Russia into the fray. It may be tempting for Vladimir Putin’s Moscow to take advantage of the ethnic and religious tensions in Afghanistan in order to advance its economic and political interests. The Russian president has let it be known that he considers the collapse of the Soviet Union to be a great tragedy his country and his people have faced. He is working hard to bring into Moscow’s orbit the countries that were lost and spun off as independent states. Most of these are in Central Asia. It would be helpful for Russia if a non-Pashtun leader finally holds the reins of power in Kabul. That way he will have considerable influence over the energy-rich nations of Central Asia. One of the strategies the West is working on is to have the energy-deficit West European nations become less dependent on the Russian oil and gas exports. Central Asia and the growing energy production in the United States offer alternative sources of supply to Europe. By tightening its grip over Central Asia, Moscow will be able to blunt the instrument the West is hoping to use against it. Increasing influence over Afghanistan helps President Putin in one other way. He will recover some of the lost prestige by a superpower as a result of the 1989 withdrawal of its troops from Afghanistan. Pakistan, with Moscow reinserting itself into the equation, must prepare to deal with the worst case scenario developing in Afghanistan. Published in The Express Tribune, April 14th, 2014. |
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