AFGHAN ECONOMY 'AT RISK OF RELYING ON DRUG TRADE'

Afghan economy 'at risk of relying on drug trade'

A United Nations body will warn this week that Afghanistan is in danger of
reverting to an economy entirely dependent on the illegal drug trade and a
"terrorist breeding ground" unless the international community
significantly increases development funding to the war-torn country.

The warning comes in a UN Development Programme (UNDP) report to be
presented to the international Afghanistan conference opening in Berlin on
Wednesday.

The report, obtained by the Financial Times, complains that "aid . . . has
been much lower than expected or promised. In comparison to other conflict
or post-conflict situations, Afghanistan appears to have been neglected".

Hamid Karzai, Afghan president, has announced that parliamentary and
presidential elections, scheduled for June, will be postponed until
September, a tacit acknowledgement that reconstruction efforts have stumbled.

The UNDP report notes Iraq is receiving "10 times as much development
assistance with roughly the same size of population". Development inflows
amount to $67 (€55, UKP37) per person, compared with $248 in Bosnia
Herzegovina and $256 in East Timor, according to the report.

The report's strong language increases the likelihood of tough financial
negotiations at this week's conference, to be co-chaired by Afghanistan,
the UN, Germany and Japan. The Afghan government is due to present a
seven-year, $28bn funding programme, while western governments have
indicated that funding commitments, lasting four years at most, are
unlikely to exceed the $4.5bn pledged by donors in Tokyo in 2002.

Mark Malloch Brown, UNDP head, is likely to be the most senior UN official
in Berlin, as the attendance of Kofi Annan, UN secretary- general, is
uncertain.

The report, which compiles the UN's latest data on Afghanistan, says the
country's $4bn estimated gross domestic product is small compared with the
$14bn in "military costs" spent annually in Afghanistan by western powers.

Morer than half the population live in extreme poverty, and only Sierre
Leone ranks below Afghanistan on the UNDP's human development index. Life
expectancy is below 50.

In Badakshan, northern Afghanistan, a maternal mortality rate of 6,500 per
100,000 is the "highest ever recorded in any part of the world", the report
says.

The reliance on poppy production for drugs has become part of ordinary
people's "coping strategy", especially as only 37 per cent of
poppy-producing households are poor, compared with 54 per cent of those not
involved in poppy production.

David Lockwood, head of the UNDP's taskforce in Afghanistan, said the
report underlined the need for a "change of gear by donors, from the crisis
agenda of the last few years to a development agenda".

Separately, Donald Rumsfeld, US defence secretary, insisted the US had not
overlooked the terrorist threat from Afghanistan in the days before and
after the September 11 attacks.

"If one looks at what was done, we went to Afghanistan - we didn't go to
Iraq," he told ABC News. "It certainly took away their training, their
haven, and it certainly destroyed the Taliban and eliminated them from
running the country."