Economy & Development

Flash from the Past: the 2002 Tokyo conference – the world’s most difficult story


Today’s conference on aid in Tokyo (8 July 2012) has come ten years after international donors first pledged money to post-Taleban Afghanistan. In January 2002, they promised $3 billion (over varying numbers of years, depending on the donor) which was then an enormous sum, although it turned out to be a small drop compared to the assistance which has actually been given. AAN senior analyst, Kate Clark, was the BBC Kabul correspondent at the time, having covered not only the war from the Shomali frontline, but also the Taleban regime. A journalist since 1995, she says the 2002 Tokyo conference was the most difficult story she has ever covered, the point when she finally understood how confined and smashed a writer can feel when trying to report contrary to the hegemonic discourse.

In early 2002, with the Taleban recently fallen and Hamed Karzai a fresh new leader, donors were preparing for a conference in Tokyo where they would pledge aid to ‘rebuild’ Afghanistan. The country had been at war for 23 years and the pretty near universally held belief was that it needed lots of money for ‘reconstruction’. The UN estimated $15 billion was needed over the succeeding decade – how pitifully small that figure looks now, when the Afghan government is asking for $40 billion over the next ten years. At the Tokyo conference in January 2002, the donors happily coughed up the money. According to a BBC correspondent who was there, ‘The real test now is whether the donors will deliver the promised funds promptly.’
I had deep misgivings about the whole basis of the story. My fear was that Afghanistan was far from secure and aid was not the answer, indeed, that flooding it with money might well be counter-productive. I also felt strongly that given security and rule of law, Afghans could probably get on with the economics of recovery largely by themselves. What civilians could not do was get rid of, or reduce the power of the commanders and factions who had piggy-backed on the US blitz of late 2001 to seize power locally and in Kabul.

Most Afghans were happy with the demise of the Taleban, and with the international intervention, but they were not happy with commander rule and expected the foreigners to see sense, live up to their talk of human rights and democracy and get rid of them – as they had the Taleban. Unfortunately, in January 2002, the greatest military powers on the planet decided they could not even deal with the militias in Afghanistan’s capital city, despite the Bonn Agreement having ordered the ‘withdrawal of all military units from Kabul and other urban areas’.(1)

With other nations and the UN in its wake, I suspected the US was focussing on aid because it was easier than addressing this consequence of its intervention – commander-rule and insecurity. Fortunately for them, spending money on building schools generated nice pictures on TV and fuzzy feelings back home.

That aid was the answer to Afghanistan’s problems had become a hegemonic discourse. The only questions available to journalists like myself were how much should be given and for what. In one live interview, I remember being asked which sector needed the most aid? Cornered by a closed question, I managed to squirm into talking about clearing up landmines – which was not what the interviewer wanted to hear and not what I really wanted to say.

All this was difficult because many Afghans were, and still are, poor and without adequate food or access to schools, jobs or proper medical treatment. This was a people who, in 2002, had not only survived war, but also a cruelly hard drought. The population was starved of its own resources – deposits at mosques, for examples, that existed in some places to be able to cope with emergency situations had long been used up. It was just that the notion of saving Afghanistan through giving money felt like discussing decorating a house built on sand.

Below is my attempt to try to frame these worries in a way which could be broadcast ahead of Tokyo. It was not used much, as I recall, but it was at least an attempt to swim against the tide of received opinion. It is not particularly well written and my reference to the civil war of 1992-1996 is clumsy and ill-placed. Of course, civil war did not erupt – except when the Taleban later re-emerged, but, on the whole, I still think my instincts were right. Ten years on, my fears seem very reasonable, but in 2002, questioning Tokyo risked sounding like Cassandra at a time when Afghanistan was relentlessly being reported as an unblemished success story.

The second half of the piece, presented here in square brackets, I cut myself, without bothering to offer to the editors. I worked the material into a later dispatch. I’ve included it here because of the interesting details on crime in Kabul and the money supply and the accusations from the money market that the defence ministry, then controlled by General, now Marshal Muhammad Qasem Fahim, and former president Burhanuddin Rabbani had been selling large amounts of newly printed Afghanis (this would have been their last cashing in on their ability to print money which they had held since the mid-1990s). (1)
Last year, the amount of capital flight from Afghanistan was greater than the amount of annual aid the government is asking for at Tokyo. The amount of dollars flown out of Kabul airport alone said the central bank was $4.6 billion. That was double what the bank thought was flown out in 2010 (read the report here). The problem then as now, it seems to me, is not a lack of resources in Afghanistan, but who has access to them; in other words, this is still about power, equity and the rule of law.

Script for BBC radio: Security (20 January 2002)
CUE: As participants prepare for a major conference in Tokyo on reconstruction for Afghanistan, reports inside the country say that in many places, security has deteriorated in the last few months. As the BBC Kabul correspondent, Kate Clark, reports, improved security underpins all Afghan hopes for prosperity

This is Afghanistan’s second chance for major international help with reconstruction. A veteran aid worker here showed me a copy of the plan which was put together after the fall of the communists in 1992. It’s difficult to get too excited this time round, he said, recalling how hopes were shattered when the victorious mujahedin factions – supported by foreign countries – turned on each other. They later re-unified themselves as the Northern Alliance and several of their leaders are now back in the interim administration, along with technocrats and exiles. Afghans hope this time the peace will hold and their country can be rebuilt. But in much of the country, security is already deteriorating. The American military campaign here got rid of the Taliban, but also left a country awash with weapons and, in many places, resurgent armed factions and commanders.

Armed men at check posts demanding money from travellers are common on some roads. And in places like Kabul, a crime wave has followed the entry into the city of thousands of Northern Alliance fighters. In many places, aid workers report that humanitarian food and goods are being looted. Reconstruction aid will be welcomed in Afghanistan, but future prosperity depends even more on peace.

[In the last decade, no faction has had trouble finding money to finance the war. Little has spilled over into traditional state funding on health, education or building infrastructure. Now, there is an internationally recognised government hoping to get large amounts of aid for reconstruction. However, the old-style spending still seems to be in place. The former president, Burhanuddin Rabbani, and other leaders of Jamiat-e Islami have been funding commanders in an attempt to gain control of provinces to the south of Kabul. Jamiat is the faction which took over Kabul after the Taliban fled and, since the Bonn Agreement, holds the foreign, defence and interior ministries and the intelligence service. Until the handover of power to the interim government, it was also legally in control of the money supply, holding the contract to print the national currency, the Afghani.

Foreign military aid, it seems, is not the only source of finance. ‘Dollars are flowing out of the market’, said one money changer in Kabul, ‘and useless money is flowing in.’ Huge amounts of recently printed currency have been flooding the market – causing the Afghani to devalue.

Several money changers said former president, Burhanuddin Rabbani, bought hundreds of thousands of dollars just before he handed over power to the interim administration. They have also said tens of thousands of dollars have been exchanged by the defence ministry.
The Afghan deputy interim finance minister admits his ministry has no control of the money supply and no funds in the central bank. He said help from the International Monetary Fund was urgently needed to set up a proper banking system for Afghanistan.]

(1) A British officer involved in the initial deployment of ISAF later told me they had decided it would be bad for stability to take on General (now Marshal) Fahim, leader of the Jamiat forces, which, along with Ittihad, had taken Kabul on 13 November 2001. Fahim also got the defence ministry.
(2) In April 2002, the governor of Afghanistan’s Central Bank, Anwar al-Haq Ahadi, told me that the Russian company which prints Afghani bank notes told him they had supplied three hundred billion Afghanis – worth about eight million dollars – in early December, just before the handover to Karzai. This was while Rabbani was head of state and in Kabul, ie between the fall of the Taleban and the inauguration of Karzai; when I questioned Rabbani about this, he freely admitted to having paid off his commanders.
Before 2001, printing money had been one of the main ways that the Northern Alliance, specifically the Jamiat Massud/Rabbani core, funded the war. In effect, Afghans nationwide paid for it through inflation.

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Thematic Category: Economy & Development