AFGHAN ANTI-DRUG PROGRAM STALLED

Canadian Funds to Fight Narcotics Trade Left Unspent

UNITED NATIONS - Four months after Prime Minister Stephen Harper
announced a substantial increase in funding for Afghan reconstruction
and development -- with a large portion of the new money slated for
anti-drug programs -- Afghanistan's cumbersome bureaucracy has managed
to spend only a fraction of the windfall.

Britain, chief donor to the US$42.3-million fund, is so alarmed it has
"turned off the [money] tap" until Afghanistan's ministries show they
can spend the cash, which has languished in the Counter Narcotics
Trust Fund since its inception in 2005.

Critics say leaving the money to sit idle is scandalous, given that
Canadian and other NATO troops are locked in a deadly struggle to make
the country safe for reconstruction. Since the 2001 U.S.-led invasion
of Afghanistan, 56 Canadian soldiers and a Canadian diplomat have been
killed, as well as nearly 500 soldiers of the international forces.

Canadian officials are more guarded than their British colleagues when
asked if Canada has interrupted the flow of taxpayer money to the fund
pending improvements in the Afghan government's efficiency.

"The trust fund is relatively new and operates in a challenging
environment," said a Foreign Affairs spokesperson.

"It is accordingly expected that considerable initial effort would be
invested in getting the building blocks right for responsible
assistance to be programmed."

The department did not answer inquiries about the exact status of the
$3-million Mr. Harper pledged for the fund in February, among
$200-million for other anti-drug, reconstruction and development programs.

As a result, it remains unknown whether Canada will follow the British
example and hold back or stagger delivery of its latest pledge. The
Canadian International Development Agency has been more forthcoming,
confirming it has delivered $1.2-million it agreed in March, 2006, to
hand over.

The fund, one of the Afghan government's flagship reconstruction
programs, aims to combat drug production in part by giving people
other means to earn a living. "Our appeal to donors is to trust the
trust fund," said Habibullah Qaderi, the Afghan Counter Narcotics
Minister, at the fund's launch.

Since then, deposits plus pipeline pledges now total US$74.5-million,
according to figures supplied yesterday by the UN Development Program,
which acts as trustee.

But while a management board that includes Afghan, UN and donor
officials has approved US$27.2-million in projects, the Afghan
government has taken charge of just US$7.2-million. As of last month,
it had spent only US$1.3-million.

"It's basically an administrative mess," said one international source
with knowledge of the fund's workings.

"There is something inherently wrong with the entire program, from the
complicated application process, to confusion over what projects are
eligible, to the sheer impossibility of working out who's actually
doing the approving and the rejecting."

While there are plenty of ideas for projects from officials and aid
agencies throughout Afghanistan, applications must be made through
government ministries --leading to the bottlenecks.

"The main issue is ministry capacity," said one senior Western
diplomat. "The government of Afghanistan started from an extremely low
base."

Approved projects include a micro-hydro system in northeastern
Afghanistan that could boost incomes and create jobs by providing
electricity. But that appears an isolated example.

"I have not seen any impact of the significant financial contributions
to that trust fund on the ground in Helmand or Kandahar [in the
south], which is where I work," said Norine MacDonald, a leading
Afghanistan researcher with the Senlis Council, a think-tank that last
week issued a scathing criticism of CIDA's aid record in the country.

She said poppy cultivation is up in those provinces, which are also
the focus of Canadian troop deployments. "I think there are a lot of
indicators that there is a lot of private dissatisfaction with how
counter-narcotics policy is going in Afghanistan."

Britain says it still has faith in the fund, but cannot justify
further donations at present.

"It's not about a continuous tap," said one British official. "It's
rather, you turn on the tap and give a certain amount, and when the
bucket's full, you turn off the tap. When the bucket is a bit emptier,
you can add more."

Other donors include the European Commission, Australia, Japan, Poland
and Sweden. "There are plenty of other places where this stagnant
money could be used," said an Australian diplomat. But officials
stressed there is no concern the money might be swallowed by
corruption or misdirected.

"The general mood among donors is that they want to understand why
there are bottlenecks before they add more money," another researcher
said.