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Budgeting for Afghanistan December 1, 2009

Posted by Trice Kabundi in Analysis.
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Tonight, President Obama will announce the administration’s new strategy for the country’s engagement in Afghanistan. The televised, prime time speech will be the result of months of deliberation and President Obama’s decisions will ultimately carry significant budgetary implications.  To gain better insight on the next chapter of the US-Afghanistan relationship, it is important to first understand the budgetary trends that lie behind the last nine years of US engagement in Afghanistan.

Where has all the money gone?

Since FY 2002, the US has provided more than $35 billion [1] in assistance to Afghanistan, roughly two-thirds of which has been provided in the last four fiscal years.  The underfunding of the war in Afghanistan has required that Congress provide dramatically higher amounts since FY 2006.   In FY 2007, policy focus shifted back to Afghanistan and was the first time since FY 2002 that US assistance to Afghanistan totaled more than assistance to Iraq.   Costs are expected to rise in FY 2010, as shown in the graph below and even more so with additional troops being sent to the region.

Composition of Assistance

To clarify the balance between the various forms of US assistance, BFAD recalculates US assistance to Afghanistan into three categories:  security assistance; development and humanitarian support; and policy-driven economic assistance.

Security Assistance

Security assistance [2] is defined here as support aimed at strengthening, training, and equipping Afghan military and security forces, including traditional military-to-military cooperation.  Security assistance has been, by far, the largest component of US assistance to Afghanistan due to a resurgent Taliban and vast amounts of ungoverned spaces.   Congress has plus-ed up the Afghan Security Forces Fund (ASFF) in the last few years to expand, train and equip the Afghan National Security Forces, and strengthen Afghanistan’s Interior and Defense ministries.  The FY 2010 National Defense Authorization Act (NDAA) recently authorized $7.5 billion for ASFF, a $1.9 billion increase, or 34 percent, over FY 2009.

US-led PRTs in Afghanistan are primarily funded through CERP funds, which are also included here as part of security assistance.  Although a portion of CERP funds provide for small-scale humanitarian relief and reconstruction efforts, PRT operations are also intended to enhance security and strengthen the reach of the central government.  Most of the $1.3 billion the FY 2010 NDAA authorized for CERP will be allocated to ongoing efforts in Afghanistan.

Development and Humanitarian Support

Development and humanitarian support [3] includes those accounts aimed at investment in people, democracy building and other non-kinetic support. Prior to 9/11, US assistance to Afghanistan primarily consisted of food aid (PL 480), and funding for development and humanitarian support made up nearly 99 percent of total US assistance to Afghanistan. In stark contrast, the FY 2010 request would provide $110 million for development and humanitarian assistance, or one percent of total assistance.  Development and Humanitarian support peaked in FY 2002, with $631 million; since that time, assistance has hovered around $300 million.

Policy-driven Economic Assistance

Policy-driven economic assistance [4] programs are developed with US strategic and foreign policy interests in mind, though they may provide some development benefits.   Since FY 2002, Congress has provided, on average, $631 million, or 22 percent of total assistance, for policy-driven economic assistance.  In FY 2004 and FY 2005, Congress provided additional funding to assist in preparation for the national elections, including the creation of training programs for newly elected officials, the drafting and ratification processes of Afghanistan’s national constitution, and to continue many of the programs created to reform the Afghan civil service and justice system.

1. This figure excludes US military operations, base security, embassy costs, veterans’ health care, and other related costs.
2. Security Assistance includes: Foreign Military Financing (FMF), International Military Education and Training (IMET), International Narcotics Control and Law Enforcement (INCLE) Nonproliferation, Anti-Terrorism, Demining and Related Programs (NADR), Peacekeeping Operations (PKO), Afghan Security Forces Fund (ASFF), Commander’s Emergency Response Program (CERP), and DOD-Other.
3. Humanitarian and Development Support includes: Global Health and Child Survival (GHCS), Development Assistance (DA), Food Aid (PL 480), Migration and Refugee Assistance (MRA), and Function 150-Other.
4. Economic Support Funds (ESF) is defined here as Policy-Driven Economic Assistance.

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