Afghan government rewarded by international donors

28 January 2010

The Afghan government has been rewarded by the World Bank for achieving domestic targets set by international donors.

It will receive $45 million for achieving targets on revenue collection, public administration reform and private sector development, set by the World Bank and Afghanistan Reconstruction Trust Fund (ARTF) donors last year.

The UK is the largest of more than 30 donors to the ARTF, set up in 2002 as an independently-audited emergency facility to pay the salaries of civil servants.

It is now the main route for donors to safely pay money to the Afghan government and this year DFID gave £60m to the ARTF, nearly half of its total spend in Afghanistan.

Thanks to the ARTF there are now over 160,000 teachers in Afghanistan delivering primary education to over 6 million children.

Those numbers continue to grow and recent surveys show that education is seen by many Afghans as an area where their government is delivering for them.

The International Monetary Fund, World Bank and Afghanistan’s major donors have also agreed to provide $1.6 billion in debt relief as a result of economic goals set by the Heavily Indebted Poor Countries initiative (HIPC). 

However, the Afghan government remains aid-dependent and raises only 7% of GDP in domestic revenue (compared to an African average of 20%).

And the private sector is still recovering from 30 years of war.

At the London Conference on Afghanistan, which today (January 28) the Afghan government committed to a series of new reforms, backed by the international community.

One of those present, Afghan Minister of Finance, Omar Zakhilwal, was involved in setting the ARTF's incentive programme, which has supported him and his colleagues in delivering critical changes.

The ARTF will remain critical to delivering the resources to back up those reforms.