Afghanistan and the Tokyo Conference: Hope, Fantasy, and Failure

Like the Bonn Conference in December 2011, and every other international conference on Afghanistan to date, the Tokyo Conference has been an awkward mixture of hope, fantasy, and failure.

The Tokyo Conference provided some degree of conditional hope that the United States and other donors would give Afghanistan substantial aid through 2015, including new pledges of support for Afghanistan during transition. At the same time, however, it updated the past fantasies that decouple such pledges from reality and spin the outcome of the conference into far more success than is remotely honest.

More broadly, the conference failed to come to grips with any of the key threats to transition and ignored the almost total lack of credible planning and coordination in the continuing aid effort.

Conditional Hope
There were some hopeful aspects to Tokyo. The conference did lead to some $16 billion in pledges through 2015, and it did catalyze some momentum behind a sustained aid effort. Such an effort is sorely needed as transition comes with increased responsibility—and thus costs—for the Afghan government, coupled with significant cuts in U.S. and allied military spending. As Secretary of State Hillary Clinton noted in her July 8 statement at the conference,

As President Obama has said, as Afghanistan stands up, it will not stand alone. Let me speak briefly about each group’s role.

Obviously, the future of Afghanistan belongs to its government and its people. And I welcome the clear vision presented by President Karzai and the Afghan Government today for unlocking Afghanistan’s economic potential by achieving a stable democratic future. That must include fighting corruption, improving governance, strengthening the rule of law, increasing access to economic opportunity for all Afghans, especially for women.

On this point, let me emphasize that the United States believes strongly that no nation can achieve sustainable peace, reconciliation, stability, and economic growth if half the population is not empowered. All citizens need to have the chance to benefit from and contribute to Afghanistan’s progress, and the United States will continue to stand strongly by the women of Afghanistan.

President Karzai has made a strong public commitment to stamping out corruption, implementing key reforms, and building Afghanistan’s institutions. We will support him and the government in that endeavor to enable Afghanistan to move toward self-reliance and away from dependence on donor assistance.

As Afghans do their part, the international community must do ours, by making concrete pledges of economic support to ensure that Afghanistan meets its fiscal needs in the critical post-transition period.

I am very pleased that Prime Minister Noda has confirmed that $16 billion is available from the international community through 2015. This is sustained economic support that will help Afghanistan meet its fiscal needs even as assistance declines. The United States will request from our Congress assistance for Afghanistan at or near the levels of the past decade through the year 2017. And our assistance will create incentives to help the Afghan Government meet mutually agreed reform goals.
 

This statement followed earlier U.S. statements that pledged continued commitment to Afghanistan well beyond 2014. The previous day Secretary Clinton announced that Afghanistan is now designated a major U.S. non-NATO ally—along with Israel, Japan, Pakistan, and other close Asian and Middle Eastern allies. “Please know that the United States will be your friend,” she told President Hamid Karzai. “We are not even imagining abandoning Afghanistan. Quite the opposite. We are building a partnership with Afghanistan that will endure far into the future.”

It is important to note, however, that these pledges were never linked to a specific plan and spending schedule. The pledges only cover the period through 2015 and are conditional on the Afghan government making major reforms to fight corruption and making efficient and flexible use of aid. These conditions reflect international donors’ frustration with the poor quality of Afghan governance, planning, management, and ability to operate in high-risk areas. While improvement in these areas will be critical to any hope for lasting security and stability as real transition begins to take effect, it is unlikely that the Afghan government will be able to deliver more than modest reforms.

The final declaration of the Tokyo Conference involves a short, self-congratulatory piece of generalized fluff—none of which realistically address a single issue: https://www.mofa.go.jp/region/middle_e/afghanistan/tokyo_conference_2012/tokyo_declaration_en1.html.

Accompanying the declaration, however, is an annex entitled the “Tokyo Mutual Accountability Framework,” which lists 15 commitments the Afghan government needs to meet during the next two years: http://www.mofa.go.jp/region/middle_e/afghanistan/tokyo_conference_2012/tokyo_declaration_en2.html.

These conditions are more aspirational than realistic; some even reach the fantasy level. They include free and fair presidential and parliamentary elections in 2014 and 2015—regardless of security, a possible peace process, and the risk of national divisions along ethnic and sectarian lines. They also include human rights goals, such as improving implementation of a law to punish violence against women, despite the dismal prospects for improvement on this front.

Moreover, the Tokyo Declaration leaves much unanswered on how the international community will address these problems, leaving further discussion for a follow-on conference in London scheduled for 2014. By then, however, there will be little time in which to deal with major problems before most troops are gone.

Even if one only looks at corruption and fiscal responsibility, the Afghan government has never met a single pledge to fight corruption, and even the most honest ministries have major problems in managing and executing any aspect of governance and economic development. President Karzai—who has never before made good on any pledges to reform and who presumably will leave office after the election in 2014—made a long series of new commitments to reform, inviting each donor or nation individually to hold the Afghan government to account.

Press reports (Reuters) say that these conditions could affect some 20 percent of all the aid pledges. Secretary Clinton said that, “We have agreed that we need a different kind of long-term economic partnership, one built on Afghan progress in meeting its goals, in fighting corruption, in carrying out reform, and providing good governance.” This conditionality can be critical in a country whose governance is weak or absent and with a president who has undercut or cancelled every anticorruption effort in the past, given that such efforts could threaten many of his relatives and political allies.

From Hope to Fantasy
The broader problem with these hopes, however, is that the ability for donors to deliver on their pledges and for aid actually to meet Afghan needs may simply degenerate into fantasy. Nations often do not make good on even their short-term pledges, turn aid into loans, and tie aid to specific projects and priorities regardless of need. While international conferences do not inevitably turn into liars’ contests, they do have a consistent history of making ambitious statements that were never kept after key donors lost interest (e.g., in Iraq, Kosovo, Bosnia, and Haiti following international troop withdrawals).

As Secretary Clinton also noted, the levels and types of aid are critical: “Afghanistan’s security cannot only be measured by the absence of war…It has to be measured by whether people have jobs and economic opportunity, whether they believe their government is serving their needs, whether political reconciliation proceeds and succeeds.”

Even U.S. statements, however, do not bind the United States to any given level of time, troops, military, support, or aid, but various background statements do talk about keeping some 10,000 to 25,000 U.S. troops in Afghanistan after 2014, providing major military aid through at least 2017, and economic aid long beyond the 2015 time-frame pledge at Tokyo. U.S. political support for such aid may lessen, possibly as early as FY2013, given the pressures for major further budget and force cuts, but they are at least statements that link today’s U.S. policy to some form of consistent effort. Other donors are far more careful about making longer-term pledges, although some have made more specific near-term pledges.

The most serious problem with the pledges, however, is that they are not tied to any credible assessment of actual requirements, plans for meeting them, and combined assessment of how to deal with the massive uncertainties in both the military and economic aspects of transition.

The Tokyo Conference seems to be an exercise in downsizing requirements that lacks any transparency or public credibility, and even if one avoids the word “dishonest,” this creates a fantasy where it is impossible for anyone—including all of the donors and participants at the conference—to weigh the level of pledges against what little is known of Afghanistan’s actual requirements.
The economic aid pledged per year remains unclear, but it is clear that it fell far short of the average of $10 billion a year that Afghanistan requested at the Bonn Conference. Furthermore, the 80 donors at the Tokyo Conference never addressed the longer-term Afghan request for $120 billion through 2020.

The Tokyo Conference did not clearly separate economic aid from aid to Afghan governance, aid to the Afghan security forces, and aid to keep the Afghan economy functioning, given the massive military and aid spending cuts that will accompany transition.

Depending on press reports, the aid actually pledged per year was a bit short of $4 billion (if all pledges are met for what may be the first time in history) versus $6 billion a year from an estimate by the Afghan Central Bank, and earlier estimates of some $7 billion by the World Bank before the 2011 Bonn Conference. All these estimates were somehow scaled down before the Tokyo Conference, though they do not seem to include aid to Afghan National Security Forces, the Afghan Local Police, or the new Afghan Public Protection Force.

It is equally important in separating hope from fantasy to note that these aid figures are not tied to any economic assessment of the combined impact of withdrawal of virtually all of the International Security Assistance Force (ISAF) from Afghanistan and ongoing cuts in past aid—which lags in disbursement have remained high through this calendar year and will begin to fall greatly in CY2013.

Moreover, as ISAF troops go down, aid levels are cut, and administrative costs increase as a percentage of total aid actually spent, it is difficult to estimate what portion of the money allocated each year by given governments will actually reach Afghans. Donor overhead costs will almost certainly average close to 15 to 20 percent, and the Afghan government will impose its own overhead costs. Some worst-case estimates that include corruption indicate that an average of 40 percent of aid money never actually reaches and/or stays in country.

Most important, aid is only part of the impact of outside spending, which has so far been dominated by the in-country military forces deployed in Afghanistan. The World Bank has not been able get enough data to make a credible estimate of the total money the military actually spends in Afghanistan versus the aid money actually spent in Afghanistan, but past World Bank studies indicate that past aid spending within the Afghan government’s budget has averaged at least three times the Afghan government’s total ability to generate domestic revenues, and off-budget aid may have brought the total to five to seven times the Afghan government’s total ability to generate domestic revenues. If military spending is added to this total, the level of outside spending over the last five years may well be over 10 times the projected revenue-raising capability of the Afghan government.

It is this military spending that over the course of a decade now drives much of the market economy of Afghanistan, including much of the civil spending in areas like construction. It impacts on almost every aspect of the growth in the Afghan GDP and increases in Afghan domestic revenues, and it has distorted almost every aspect of the market economy, not only through corruption but also through high levels of waste and duplication from the uncoordinated national military spending and aid efforts—efforts that have also affected prices of basic goods.

In short, the problem of using aid to both offset outside spending cuts and meet current Afghan needs goes far beyond economic development and other fantasies like the “New Silk Road.” It affects the entire mix of Afghan security, Afghan governance, and Afghan economic development. These issues were never addressed in any public form in Tokyo, and it is unclear any credible plan or estimate exists at any level within international organizations like the World Bank or within the U.S. government.

The Cost of Failure
This is the most critical failure of both the Tokyo Conference and the transition effort to date. There is no real plan, and there is no one in charge. The end result has been a flood of good intentions coupled to steady cutbacks in plans and resources at the national and international level with no credible coordination of the military-civil efforts.

It is certainly true that such efforts face many uncertainties—the level of future security that can be achieved by the end of 2014, the effectiveness of Afghan forces, the role of Pakistan, and the success or failure of peace efforts, just to name a few. Plans, however, can be changed, and so can systems for building Afghan forces and managing military and economic aid.
However, the current lack of planning and management, downsizing every requirement for aid to what seems to be available at a given date, a lack of civil and military coordination, and a focus on spin to try to sell a steadily less popular war is a recipe that can turn the current risk of failure into a certainty.

Correcting the failures of both the Tokyo Conference and the December 2011 Bonn Conference requires the United States, its allies, and other donors to take eight critical steps:

1. Put a single, high-ranking official in charge of the overall international civil and military aid efforts with a matching office in the Afghan government to create a coordinated effort to provide aid and security, monitor Afghan progress, and both deal with the unpredictable course of transition and create something approaching a credible analysis of longer-term requirements and aid.
2. Create a credible and effective replacement for one of the worst and least-effective bodies in UN history: the United Nations Assistance Mission in Afghanistan. This supposed aid coordinator has never produced a useful report on aid, much less done its job. The Afghan government needs help from a body that can actually do the proper planning, including on managing the aid process and setting requirements. This requires both a strong coordinator of the kind listed above and a staff with the planning capabilities of the World Bank. It certainly requires far more competent and proactive leadership, and an expansion of its mission to address military aid as well as aid to the government and economy.
3. Provide the embedded aid and expertise to help the Afghan government create strong and competent offices to perform the same functions and takeover from the international effort.
4. Require donor countries and nongovernmental organizations (NGOs) to coordinate with reorganized UN and Afghan efforts, setting clear standards for reporting, transparency, financial statements, and justification of requirements and aid activities to the United Nations, the Afghan government, and the public. Require NGOs to meet these standards or leave the country. These requirements need to be revised on at least a semi-annual bases, and preferably quarterly.
5. Restructure the present ISAF and U.S. military training efforts—NATO Training Mission–Afghanistan (NTM-A)—to require the same degree of reporting, transparency, financial statements, and justification of requirements and aid activities. Require ongoing quarterly reassessments of the present force development plans tied to any assessment of the security situation. Require that plans be separated for the Ministry of Defense (MoD) and each element of the MoD forces; for the Ministry of the Interior (MoI) and each element of the police forces; and require that plans integrate the Afghan Local Police and Afghan Public Protection Force (APPF). Require rolling five-year plans for each force that set meaningful force goals and funding plans rather than the absurd goals for all force elements, with no credible costs, for an undefined future long after transition.
6. Require that planning address the entire impact of outside spending on transition, and not just aid.
7. Require realism in planning the near- and mid-term development of the Afghan economy and domestic revenue capabilities of the Afghan government, rather than using best-case numbers or absurd estimates of the near- and mid-term possibilities for growth from mines, oil, and fantasies like the “New Silk Road.”
8. Require that the United States—as the largest donor—create its own integrated plan with a single official clearly in charge in the National Security Council with the power to force effective planning and coordination.

There is no question that each of these eight steps requires a level of action that the United States and its allies, as well as other donors and the Afghan government, have failed to take to date. These steps also pose what may prove to be impossible diplomatic challenges—as well as require a far more effective structure for interagency coordination within the U.S. government than currently exists. The fact remains, however, that everyone is running out of time for fantasies and failures. If efforts like the Tokyo Conference continue, they will turn the risk of failure into a certainty.

(For a full analysis of the economic and aid issues involved, see “Afghanistan: The Failing Economics of Transition,” https://www.csis.org/analysis/afghanistan-failing-economics-transition.)

Anthony H. Cordesman holds the Arleigh A. Burke Chair in Strategy at the Center for Strategic and International Studies in Washington, D.C.

Commentary is produced by the Center for Strategic and International Studies (CSIS), a private, tax-exempt institution focusing on international public policy issues. Its research is nonpartisan and nonproprietary. CSIS does not take specific policy positions. Accordingly, all views, positions, and conclusions expressed in this publication should be understood to be solely those of the author(s).

© 2012 by the Center for Strategic and International Studies. All rights reserved.