91515 Quarterly Country Update ISSUE 35J U LY 2010 Afghanistan Introduction On June 26, President Karzai introduced his choices for seven cabinet positions to the Wolesi Jirga (Lower House of Parliament). On June 28, after listening to work plans and strategies of the proposed ministers, MPs cast their vote of confidence through secret balloting. Five of the seven proposed ministers secured the parliamentary vote of confidence. With the approval of these ministers, 7 portfolios of President Karzai’s 25 member cabinet still remain outstanding. Since being reelected as the President last year, Karzai sent three rounds of nominations According to the to the parliament. In the first round only 7 out Afghanistan Public of 24 proposed ministers obtained the vote of Expenditure Review, confidence from the parliament whereas in the second attempt again 7 out of the 17 proposed the Government ministers secured the confidence vote. Afghanistan has made On June 21 – 24, fifteen members of the some notable fiscal United Nations Security Council visited advances in recent Kabul to assess the situation for themselves. The Security Council’s visit was also to years. The Public demonstrate their continued support for the Financial Management Government and the people of Afghanistan as they strengthen the foundations to ensure (PFM) system, especially a sustainable peace for all. The Security at the Ministry of Council reviewed the progress made by the A little child has a meal on a neighborhood sidewalk in Kabul. Afghan Government, with the assistance of (Photos: Pajhwok Afghan News) Finance (MoF), has the international community, assessed the undergone a structural implementation of relevant Security Council resolutions, and looked ahead to issues on the On 02-04 June, a National Consultative Peace Jirga transformation, (conference) was held to seek ways to secure a agenda for the Kabul Conference on July 20. confirmed by For more information, please visit: lasting peace in the country. Some 1,600 delegates http://unama.unmissions.org representing all walks of life participated, including a s i gn i f i c a nt members of both Houses of the Parliament, Provincial improvement in the On 23 June, Afghanistan’s Independent Councils, religious scholars, tribal leaders, civil society Election Commission (IEC) announced the organizations, as well as Afghan refugees residing Public Expenditure and in Iran and Pakistan. At the end of three days, the final list of candidates for Afghanistan’s second Financial Accountability parliamentary election. The final list of Wolesi delegates passed a resolution. For more information, Jirga contestants includes 2,577 candidates, please visit: http://president.gov.af/Contents/88/ (PEFA) indicators 405 of them women. Contestants are aspiring Documents/1834/resolution_English.htm between 2005 and for 249 seats in Afghanistan’s Lower House of 2007. parliament. Afghanistan’s second legislative On April 29, a two day summit of the leaders of South poll is scheduled for September 18 this Asian Association for Regional Cooperation (SAARC) More information year, while security has remained the main countries was held in the Bhutanese capital of Thimphu. available on: challenge for the process. The SAARC nations reiterated their firm determination to combat terrorism, illegal drug trafficking and http://go.worldbank. On 21 June, the United Nations Office on Drugs people smuggling. In a declaration issued on the org/IFYJGSRDW0 and Crime (UNODC) and the Government of conclusion of the event, the leaders reaffirmed their Afghanistan released findings from a survey commitment to the implementation of the SAARC on Drug Use in Afghanistan. The survey shows Regional Convention on Suppression of Terrorism and that around one million Afghans (age 15-64) its Additional Protocol. Also emphasized were greater suffer from drug addiction. At eight per cent regional efforts at poverty alleviation, and expeditious of the population, this rate is twice the global mainstreaming of SAARC Development Goals (SDGs) average. For more information, please visit: in the national processes and completion of the mid- http://www.unodc.org term review of the SDGs as scheduled. For more 1 THE WORLD BANK IN AFGHANISTAN Japan Social Development Fund The JSDF was established by the Government of Japan in 2000 as a means of supporting activities which directly respond to the needs of poor and vulnerable groups, Independent enhance their capacities, and strengthen evaluation of NSP I and II has shown: their empowerment and participation in the development process. The fund is • NSP alters the structure administered by the World Bank. The of village governance Government of Japan and the World by increasing the Bank agreed to set up a special window number of villages within the JSDF to support activities in with functioning Afghanistan under a multi-year program of councils, and providing assistance for the country’s reconstruction greater participation of and transition toward political, economic, villagers. and social stability. • A higher proportion of villagers now believe that Government officials at the national information, please visit: public administration, advances in recent years. The and local levels are http://www.saarc-sec.org gender, poverty, the opium Public Financial Management working in the interest economy, and public finance (PFM) system, especially at of all villagers. However, WORLD BANK GROUP management (PFM). The the Ministry of Finance (MoF), the program does not SUPPORT Bank has actively supported has undergone a structural seem to affect the Since April 2002, the World key reforms, particularly transformation, confirmed by level of trust within a Bank has committed over $2 in the fiscal and public a significant improvement village or the incidence billion for development and administration spheres, and in the Public Expenditure of disputes, feuds, or emergency reconstruction through its budget support and Financial Accountability attacks. projects and four budget operations. It has advocated (PEFA) indicators between support operations in building capacity and 2005 and 2007. For more • NSP stimulates the Afghanistan. This support legitimacy of the State and information, please visit: provision of dispute comprises over $1.66 billion channeling donor resources http://go.worldbank.org/ mediation and greater in grants and $436.4 million through the government IFYJGSRDW0 engagement of women in no-interest loans known to ensure investments in community activities. as “credits.” Currently, the are aligned with national On May 08, 2010, the It also appears to make Bank has 23 active projects priorities. To this end, the Government of Afghanistan men more accepting in Afghanistan with net World Bank works closely and the World Bank of female participation commitments of over $883.61 with other multilateral and released findings from an in selecting the village million. independent evaluation headman and increases “The World Bank of the National Solidarity the prominence of, So far, a number of Bank- Program. The evaluation and respect for, senior financed projects have currently has 23 active was conducted by a team been completed which of independent researchers women in the village. projects in Afghanistan include the rehabilitation of from Harvard University, the education, emergency public Massachusetts Institute of • Early evidence shows with net commitments works, the reconstruction of Technology (M.I.T.), and the that NSP has a positive infrastructure, emergency New Economic School in impact on some of over $883.6 million.” transport rehabilitation, Moscow. They looked at how services, infrastructure, health sector reconstruction, NSP affects local governance and utilities. It finds emergency communications structures, access to services that completed water project and the first phase and infrastructure, economic projects are successful of a public administration bilateral agencies across a activity, female participation in in improving the project as well as four budget number of sectors where aid community activities, political availability of safe support operations. For more coordination and government opinion and social cohesion. drinking water, and information about closed ownership are most critical. The evaluation relates to that electricity projects projects, please visit: the second phase of NSP have strong impacts on www.worldbank.org.af – On June 20, the World Bank (NSP II) started in 2007 and connectivity and usage. Projects & Programs page. released the Afghanistan aims to give policy makers However, road and Public Expenditure Review and NSP donors evidence, irrigation projects had The World Bank has (PER). The PER is a joint based on scientific evaluation fewer impacts. This is provided advice to help venture between the UK methods, of the program’s as expected given that the government manage Department for International interim impact as it enters its most of these projects donor funds effectively Development (DFID) and the third phase. Findings from are only just becoming and in a transparent way. World Bank, and is based on the independent evaluation operational. The World Bank also information available as of indicate that NSP is having supports the government March 31, 2010. According a positive impact on the lives by providing analytical to the review, the government of villagers – both improving work on the economy, has made some notable fiscal access to critical services 22 The NSP has reached over 19 million Afghans. Over 22,260 communities have elected Community Development Councils. and creating opportunities Registry for movable property budget – for both operating for women to participate in that will provide lenders costs and development local governance. For more with the ability to effectively programs. ARTF’s support for information, please visit: http:// use borrowers’ property as national priority programs, for www.nsp-ie.org collateral. IFC’s involvement operating costs of government in these two projects includes operations, and for the policy The International Finance an assessment of the legal reform agenda is contributing Corporation (IFC), the World and regulatory framework, to the achievement of Bank Group’s private sector support in the preparation the Afghanistan National development arm, continues of the necessary new laws Development Strategy goals. to work with its investment and regulations required More than $1.95 billion partners in Afghanistan. for the establishment of this has been disbursed to the IFC now has an investment infrastructure, assistance in Government of Afghanistan portfolio totaling more than $90 raising awareness among the to help cover recurrent costs, million in six companies. This relevant stakeholders, and such as civil servants’ salaries, includes commitments in the providing advice regarding and over $1.03 billion had been financial (First Microfinance the necessary IT systems. made available for investment Bank of Afghanistan, BRAC Besides these two projects, projects. Afghanistan Bank, Afghanistan IFC continues strengthening International Bank), telecom the Afghan financial sector The Japan Social Development (MTN Afghanistan), hospitality through capacity building of Fund (JSDF), administered (Serena Kabul Hotel) and various financial institutions, by the World Bank, has healthcare (Acomet Family as well as assisting the provided a special window for Hospital) sectors. Moreover, government to establish the Afghanistan which operates IFC continues to work on its legal framework for leasing. in a harmonized manner to pipeline of projects in a variety Additionally, IFC’s Advisory support the national programs of sectors in order to expand Services keep supporting the of the government. As of its Afghan investment portfolio. development of Afghan SMEs May 2010, JSDF’s current by expanding the reach of its commitment to Afghanistan IFC’s Advisory Services Business Edge management had reached $32.9 million. continue to support and business skills training A number of JSDF financed Afghanistan’s Central Bank program. projects have been completed in order to increase the so far. For more information, private sector’s access to The Afghanistan please visit finance. As part of the World Reconstruction Trust Fund http://go.worldbank.org/ Bank’s Financial Sector (ARTF) is a partnership U5OQZVF200. Strengthening Project, IFC is between the international providing technical assistance community and the STATUS OF ONGOING to the Central Bank in order to Afghan government for the OPERATIONS establish two basic financial improved effectiveness of sector infrastructures in the the reconstruction effort. Emergency National country: (i) a Public Credit Since early 2002, 32 donors Solidarity Project (NSP) Registry that will provide have contributed over $3.7 ($398 million Grant, $618 lenders with information for billion (as of May 21, 2010), million ARTF Grant and efficient risk assessment on making ARTF the largest $15 million JSDF Grant): borrowers; (ii) a Collateral contributor to the Afghan This is the Government of 3 Afghanistan’s flagship program to improve livelihoods and income- Development (MRRD). The project support small-scale reconstruction generation, 14 percent work on proposes to rehabilitate approximately and development activities identified education infrastructure, and 2 percent 2,010 km of rural roads and some by Community Development Councils go towards other investments. The 9,000 meters of drainage structures, (CDCs) across the country. The World NSP is active in 359 of Afghanistan’s generating 2.13 million unskilled Bank is one of the main sources of 364 districts and all of Afghanistan’s 34 labor days of employment. As of May financing for the NSP. Other sources provinces. As of June 12, 2010, over 31, 2010, out of 83 secondary roads include the ARTF, the JSDF, and several $700 million of block grants had been and drainage contracts planned/ bilateral contributors. Between early- disbursed to CDCs. agreed to be undertaken by MPW, May 2003 and June 2010, the NSP 64 contracts were awarded and the has reached over 19 million Afghans. In addition to subproject implementation, remaining are under development and Approximately 22,650 communities NSP has effectively strengthened at the procurement stage. 442 km of have been mobilized, and 22,260 community-level governance by secondary roads have been completed communities have successfully elected establishing a network of CDCs. CDCs so far (out of a planned total 1081 Km) Community Development Councils are the village-level representative and 197 meters of running structures (CDCs). These CDCs are established body and form a basis for interaction have been completed out of a planned through the assistance of 28 NSP within and between communities as total of 1471 meters. For tertiary roads, Facilitating Partners who mobilize the well as with government bodies and out of the 205 contracts planned by community, facilitate elections and other aid agencies. The CDCs are also MRRD, 193 contracts have been community development planning increasingly becoming the platform for awarded and the remaining are under through community consultation, dispute resolution at the community development and at the procurement assist in project preparation and level. More information is available at stage. 500 Km of tertiary roads have implementation, and also provide http://www.nspafghanistan.org. been completed so far out of a planned capacity building to CDC members. total of 925 Km, and 6691 meters National Emergency Rural Access of running structures have been Approximately 50,000 community Project (NERAP) (IDA $112 million completed out of a planned total of subprojects have been partially or and $50 million ARTF Grant): The 8201 meters. The MPW has generated fully financed, of which some 40,400 World Bank continues to support the about 16,382,203 labor days of subprojects have been completed. government’s rural access program. employment so far, and the MRRD About 80 percent of the community Following the successfully completed over 755,842 labor days. Out of the subprojects involve infrastructure such National Emergency Employment total budget of $162 million allocated as irrigation, rural roads, electrification, Program for Rural Access project for both MPW and MRRD for road and drinking water supply, all (NEEPRA), the Bank, on December rehabilitation, drainage works, and critical for the recovery of the rural 13, 2007, approved a grant of $112 routine maintenance, approximately economy, stability, and governance. million for the National Emergency $US54 million has been disbursed to The community subprojects financed Rural Access Project. In keeping date. under the NSP focus on social and with the overarching objectives of the economic infrastructure and are based program, the project aims to provide Afghanistan Rural Enterprise on the priorities of the rural population. year-round access to basic services Development Project (AREDP) ($30 Of the currently funded community and facilities in the rural areas of million Grant and $18 Million ARTF subprojects, 24 percent address Afghanistan to enhance the well Grant) enhances participation of water and sanitation issues, 16 being of the population and promote the rural poor in economic activities percent rehabilitate irrigation systems, economic growth in the country. Under by providing business development 24 percent improve transportation the project, secondary roads are being services, improving their access to infrastructure (e.g. roads, bridges), rehabilitated by the Ministry of Public finance, and strengthening market 15 percent provide energy (e.g. Works (MPW) and tertiary roads by linkages and value chains. The project micro-hydro, solar energy), 5 percent the Ministry of Rural Rehabilitation and will support the establishment of 4 There are now 13 microfinance institutions (MFIs), with a network of 304 branches in 26 provinces. 13,000 Savings Groups, 6,500 funds, including $118.2 million establish a transparent Enterprise Groups (EGs) and in loans. There are now 13 and well-functioning public 1,300 Village and Savings Loan microfinance institutions financial management system Associations. The EGs will (MFIs), with a network of 304 to ensure better use of public help maximize the economic branches in 26 provinces, and resources. The grants initially potential of rural entrepreneurs more than 429,000 savings concentrated on funding to improve market access, and loan clients. To date, the consulting firms to support deliver technical knowledge, program has disbursed a total government officials in carrying raise basic business skills, and of 1.5 million loans across out procurement and treasury leverage economies of scale Afghanistan worth $765 operations, but have now to increase the value of their million. To date, the gross loans shifted emphasis to building sales. The project will also work outstanding were $102 million. capacity in procurement with around 750 Small and Sixty percent of the clients and audit functions in the Medium Enterprises (SMEs) are women, and the loan Treasury Department of which are likely to be key repayment rate is 93 percent. the Finance Ministry. The drivers of rural employment. It The sector now employs 4,122 projects contributed to the will support SMEs in building people, approximately 1,547 establishment of the current necessary skills, promoting of whom are women; and over modern legal framework for market development, and 90 percent of professional public financial management particularly encouraging positions and 50 percent of and to the implementation business linkages into the management positions in of systems to support this rural economy. The project the sector are occupied by framework. Activities include: was declared effective on June Afghans. According to findings 15, 2010. of the Baseline/Impact study Procurement Advisor: The of the microfinance sector procurement advisor has Expanding Microfinance conducted in 2007, each MFI facilitated 873 government Outreach and Improving loan supports or creates 1.5 contracts valued at $2.2 Sustainability Project employment opportunities in billion. A new procurement (MISFA) ($30 million Grant Afghanistan. More information law has been enacted and and $183.3 million ARTF is available at: related regulations and bidding Grant): The project aims documents have also been to assist the government in “Sixty percent of the prepared along with standard developing a sustainable bidding documents. microfinance sector that will 429,000 microfinance provide flexible, convenient, Procurement Capacity and affordable financial clients are women.” Building Advisor: A services to poor people. The comprehensive needs goal is to build an integrated assessment for procurement financial sector and remove http://www.misfa.org.af. training and a plan for the barriers that separate addressing the needs have microfinance from the broader Public Financial Management been completed. Training mainstream financial system. Reform Projects ($60.4 in procurement rules and Since its inception in 2003, million Grant): A series procedures is underway the project has provided of four operations support for procurement staff of all more than $172.5 million in Afghanistan’s efforts to ministries at the Civil Service 5 Training Institute for all government auditors in the Ministry of Defense. they are to join the teaching force procurement staff. in their local communities. It also The Education Quality Improvement supports the monitoring and evaluation Financial Management Operations Program (EQUIP) consists of two of NESP (National Education Strategic Advisor: An integrated accounting, projects: 1) EQUIP I ($35 million Grant Plan) programs, including the now budget control and check issuance and $44 million ARTF Grant) started established Education Management system has been operating in the in August 2004; and 2) EQUIP II ($30 Information System at the Ministry Treasury Department in the Ministry million Grant and $171.74 million of Education. In December 2007, of Finance since October 2002. All ARTF Grant) which was launched the MOE successfully completed the budget transactions are recorded in in May 2008. The program provides school survey of Solar Year 1386. this system which generates timely district-based teacher training and Updated survey data can be found and comprehensive reports on the grants directly to communities on the MOE website . It is envisaged that by the close and financial position. This system the Ministry of Education’s National of the two projects in 2012, some has been expanded to all the line Education Strategic Plan (NESP 1,592 schools will have been built, ministries in Kabul and all but one of 1385-1389) and enjoys multi-donor with a priority on girls’ schools; 10,172 the provincial offices of the Ministry of support from the ARTF. Funds are School Shuras formed and active, Finance, and new programs are being used directly by communities through with 1,828 more Shuras to be formed; added to support purchasing and School Shuras for the rehabilitation or over 110,000 teachers and around control of assets. construction of school buildings and 9000 school administrators trained; 2750 girls in 25 provinces receiving Audit Advisor: The audit advisor has “Around 10,172 School Shuras scholarships to complete their two- assisted the Control and Audit Office year studies at TTC; and 750 qualified (CAO) with the audits of International are established to oversee lecturers recruited in 18 provinces. Development Association (IDA) For EQUIP II, the ARTF Management projects, ARTF projects and cost construction or rehabilitation Committee recently approved its first expenditures, and the state budget. phase of support of $50 million for In addition, over 100 staff members of schools.” 1388; additional funds of $35 million have participated in various training will be disbursed in subsequent phases courses, including computer and based on the results. language training, technical audit, for accessing quality inputs, such as and modern audit working practices teaching and learning materials. The Strengthening Higher Education and procedures. The CAO is being School Shuras are functioning in all Program (SHEP) ($40 million Grant equipped with computers and training provinces, and, as of now, 10,172 out and $32 million ARTF Grant): The material; a strategic development plan of 12,000 schools have these Shuras. program aims to progressively restore has been prepared and a new law on Shuras are assisted by the Provincial basic operations at six core universities auditing is proposed. Education Departments, NGOs and in Afghanistan — Kabul Polytechnic District Educational Departments in all University, Kabul University, and four Internal Audit Capacity 34 provinces. EQUIP II supports the regional universities (Balkh, Herat, Development: The Ministry of Finance District Teacher Training Program in Kandahar, and Nangarhar) — through Internal Audit Department is operating 23 provinces (the 11 other provinces partnership programs with universities an auditing training program which has are supported by the USAID). It also in the region and in the West, as well already imparted a four-month training provides regional allowances for as through competitive block grants. program to 120 staff of the Ministry of lecturers in 730 Teacher Training Funds will also be provided to set up Finance and other public entities and Centers (TTC) as well as scholarships an institutional base to develop an has trained internal audit staff from for 2750 girls to attend Teacher Training agenda for tertiary education, capacity across government, including 40 new Colleges for two years, following which building and reform. The program is 6 To restore basic operations, five Afghan universities have formed partnerships with eleven overseas universities. envisaged as the first phase of is supporting the Ministry Training (TVET) system that is a long-term higher education of Higher Education in the equitable, market responsive, development program in implementation of the 5-year and cost-effective. More Afghanistan that will act as National Higher Education specifically, the project aims a catalyst to attract various Strategic Plan, aligned to the to develop a demand-driven resources to the Afghan tertiary goals of the ANDS. To this vocational education and education sector. end, the process for providing training system, and give additional finances from IDA training institutions autonomy Under this program, eleven (The World Bank) is being to plan and customize their partnerships have been finalized. programs and establish formed for five of the six The ARTF Management partnerships with experienced participating universities with Committee approved a blanket national and international eight established overseas commitment of $32 million in training providers. The project universities. These partner 2008 to support the construction has 4 components: universities include: Kansas of faculty buildings, libraries, State University (USA), and gymnasiums, as well Component 1: Mainly University of Hartford (USA), as master plans and other focuses on the establishment San Diego State University activities to improve academic of the Afghanistan National (USA), Asian Institute of delivery in the universities of Qualifications Authority; Technology (Thailand), Balkh, Kandahar, Nangarhar, Afghanistan National University of Brighton (UK), and the Kabul Polytechnic. The Qualifications Framework and Delhi University (India), Ruhr first phase of the ARTF funded Awarding Boards. Hiring of Bochum University (Germany) activities is currently underway an expert consultancy firm is and Technical University of with $5 million in the form of a in progress to undertake the Berlin (Germany), focusing Development Grant Agreement above mentioned activities for essentially on Engineering, (DGA) that essentially covers a period of 24 months after Computer Science, English design consultancy costs as signing of the contract. The Language, Natural Science well as the cost of supervising setup for the Committee on and Economics/Management. the construction of the Education and Skills Policy Most partnership contracts buildings. Contracts for these (CESP) is in place and chaired are coming to an end in 2010 activities have been signed for by the First Vice President. but will need to be extended the Universities of Nangarhar, The CESP Secretariat has to complete the deliverables. Balkh and Kandahar and are been restructured and hiring of The usage of block grants being implemented. the staff is ongoing. to procure books, teaching materials, and IT equipment, Afghanistan Skills Component 2: In pursuance and to rehabilitate libraries Development Project ($20 of its mandate to be a model and classrooms and equip million Grant and $18 TVET institution, National laboratories is continuing. Most million ARTF): The project Institute of Management procurement packages have is designed to increase the and Administration (NIMA) been completed as per plan. number of skilled Afghans and has been established and Also, SHEP, with the support create a high-quality Technical it implements competency- of other development partners, Vocational Education and based curricula for its 7 New buildings for the Music School are currently under construction. academic programs. The Maxwell and organization, among others. train around 7000 chronically poor Stamp PLC (MSP) took over the As a result of this, interventions women, marginalized farmers and academic management during the and capacity building measures unemployed youth in 13 provinces second semester with 1,700 students. are identified and designed for namely (Khost, Zabul, Uruzgan, A significant feature is a Placement implementation. Kandahar, Badakhshan, Samangan, System where a cooperation-type Bamyan, Ghazni, Paktika, Kunduz, sustainable industry- institution “Contracts with the training Baghlan, Faryab and Helmand) linkage is being forged necessitating in wage and self employment The providers have been signed the development of competencies training programs have progressed demanded by the industries. To lend to train unemployed well and more than 5000 participants credence to the programs, the MSP have completed the training so far. through the University of Jyvaskyla youths for waged and self For the Training of Trainers (TOT) will provide international accreditation for Business Development Services to the programs and possibly national employment in 13 provinces.” (BDS), the procurement process accreditation in the event the is complete. For the development Afghanistan National Qualifications of contextualized productive Authority becomes operational. Four In addition, the project has provided skills, curriculum, and materials to computer laboratories have been support to TVET buildings and support the UN-Habitat Learning equipped initially with more or less campuses in need of renovation and and Community Empowerment 100 computers while the remaining physical rehabilitation. The physical Project 2 (LCEP-2), the NSDP has 350 units are newly contracted. up-gradation activities undertaken initiated the procurement process Several TVET institutes are also are: Construction of the Afghanistan to outsource this activity to some being supported by the Project: National Institute of Music (ANIM): competitive consultants. Proposals the Afghanistan National Institute Renovation of the ANIM is complete; from short-listed firm are currently of Music (ANIM), the School of construction of new buildings for the being evaluated. The main purpose Blind, Auto-Mechanical Institute, Music School; construction of an of these interventions is to improve Construction Institute, Women’s alternate building and construction the livelihoods of the above groups, Dormitory and some buildings for the of a library and computer center and especially those who can benefit Deputy Minister TVET’s (DMTVET) for the Auto-mechanical School; from training in improved production headquarters. construction of the surrounding wall and marketing methodologies, and of the Auto Mechanical School (80 more diversification. After a comprehensive evaluation percent complete); construction of of the DMTVET and its institutes, the auxiliary building for DMTVET (50 A curriculum and material the German Education and Training percent complete); and construction development specialist was hired to (GET) undertook and completed a of a women’s dormitory. The project support the NSDP curriculum and review/reorientation of procedures has likewise provided funds for the standards development team in and processes to prepare the purchase of equipment for the Blind development of Competency Based Deputy Ministry for a decentralized School, such as audio equipment, Training standards at different level structure. Policy recommendations stationary, slide board, stile (chalk), for the most demanded skills. So far have been put forward, and walking stick, laptop and Braille 67 standards have been developed capacity building interventions computers; and Western musical by the team and some of these have been initiated to prepare the instruments for ANIM. have already been introduced to the Deputy Ministry for a decentralized training providers. management system. This covers Component 3: Under the National human resource management, Skills Development Program The Government of Norway and curriculum development, quality (NSDP), contracts were signed with USAID are co-financing the project assurance, teacher training, planning local NGOs and training providers to in the amount of $12 million and $6 8 The World Bank’s Interim In 2008, infant and under five mortality per Strategy Note (2009-11) is aligned with Afghanistan’s thousand live births declined to 111(13 percent National Development Strategy (ANDS) and is designed around reduction) and 161 (15 percent reduction) from 129 three main pillars: and 191 in 2006. Building the capacity of the state and its accountability to its million respectively through prenatal care visit rose from 11 citizens: The Bank will continue the ARTF. The project is percent in 2004 to 49 percent Implementation has just been to strengthen core government expected to be completed by in 2008. Child immunization initiated for an innovative February 2013. rates are still low but have results-based financing systems as the basis for improved from 12 percent in (RBF) mechanism to improve credible state building. Efforts The Strengthening Health 2005 to 33 percent in 2008. coverage and quality of Activities for Rural Poor Around 20,000 community services in health facilities. will be made to strengthen Project (SHARP) ($79 health workers—half of them In addition, $17.9 million public financial management million Grant, $22 million women—have been trained has recently been approved from ARTF, $17.9 million and deployed throughout the through JSDF to co-finance and fiscal sustainability, and from JSDF, $12 million from country, increasing access to the SHARP project. This will improve transparency and Multi Donor Trust fund for family planning and boosting allow the project to provide health results innovation): childhood vaccinations. The BPHS services for Balkh, accountability. Assessments SHARP aims to improve the number of facilities with Samangan and urban Kabul of vulnerability to corruption health and nutritional status of trained female health workers for the coming 3 years. In will be integrated into ongoing Afghans, focusing especially rose from 25 percent before addition, $22 million has on women and children and the project to 74 percent been approved by the work. the underserved areas of the today. ARTF to be used to co- country. The project supports finance the implementation Afghanistan’s Health and “Recently the World of BPHS in 11 provinces Promoting growth of the rural Nutrition Sector Strategy, - in Helmand, Badghis, Bank has approved an economy and improving rural which is the blueprint for the Farah, Nimroz, Samangan, government’s health sector Balkh, Wardak, Sar-e-Pul) livelihoods: Support to the rural additional $49 million program for the period 2008- through NGO contracts, economy and livelihoods will 13. grant from Crisis and in Kapisa, Panjshir, and Parwan through direct remain a priority for the Bank. The National Risk and Response Window delivery by MOPH, under the Rural programs also serve Vulnerability Assessment stewardship of the Ministry 2007/08 indicate good to support SHARP in guiding implementation as important entry points for progress in reducing infant and policy dialogue for shifting economic incentives and under-five mortality. expansion .” the Essential Package of Infant and under five mortality Hospital Services. Recently, away from opium and toward in 2008 has declined to the Bank has also approved alternative, legal, high value 111 (13 percent reduction) SHARP finances provision of Additional Financing from agricultural products. and 161 per thousand live the Basic Package of Health the Crisis Response Window births (15 percent reduction) Services in eight provinces in the amount of $49 million respectively from 129 and (Helmand, Farah, Badghis, equivalent to expand Supporting growth of the formal 191 per 1000 live births Nimroz, Samagan, Balkh, SHARP’s implementation respectively in 2006. With Wardak, and Saripul) through capacity to deliver basic private sector: The World World Bank support in 18 national and international health and hospital services Bank Group will continue to provinces since 2003, the NGOs contracted out by to the vast majority of the number of health facilities Ministry of Public Health poor. Provision is being made address the overall constraints has nearly tripled from 148 to (MoPH). So far the MoPH to include (a) mental health to private sector development 421. Health service utilization has signed contracts with five and enhanced nutrition increased among project services in the new BPHS through lending and advisory NGOs to provide a basic area populations from a rate package of health services in package; and (b) improve work. It will identify and address of 0.3 consultations per capita seven provinces. Contracts hospital services critical to annually at the outset to 1.64 reduce maternal and child specific measures that catalyze for the remaining province per capita by the mid 2009. (Wardak) is in process. mortality. business growth and will invest Health care for expectant SHARP also supports mothers expanded, with the Afghanistan HIV/AIDS directly in local companies, monitoring and evaluation of number of deliveries assisted health services in Afghanistan Prevention Project ($10 including banks, to help them in facilities by trained health by financing a third party million Grant) is designed to expand business. workers jumping from 6 agency to conduct annual strengthen national capacity percent to 24 percent. The balance scorecards for to respond to the epidemic 9 number of pregnant women primary health care facilities by scaling up prevention who received at least one and hospitals. programs targeting people 9 engaged in high risk behaviors. HIV prevalence is significant among processes have been automated These vulnerable groups at high prisoners and appears to be related to at major Inland Customs Depots risk include injecting drug users the proportion of injecting drug users (ICD). Similarly, ASYCUDA is now (IDUs), sex workers and their clients, in prison. HIV prevalence is zero functional at four major transit axes. truckers, and prisoners. The project among both sex workers and road ASYCUDA deployment has already also aims to improve the knowledge transport workers, suggesting limited resulted in handling of 60 percent of of HIV prevention among the general sexual transmission. trade volume and 75 percent of transit population, strengthen surveillance axes. In addition, the supporting of HIV prevalence and high risk The Emergency Customs communications infrastructure has behaviors, map and estimate the Modernization and Trade also been modernized with VHF/ sizes of groups engaged in high risk Facilitation Project (ECMTFP) HF radios and VSAT VPN networks behavior, and use communications ($31.2 million Credit and $6.81 connecting key customs locations. and advocacy to reduce stigma million Grant): Since 2004, the project Key infrastructure facilities have been related to HIV and AIDS. has been supporting Afghanistan’s constructed including the Customs efforts to improve and modernize the and Revenue headquarters building Since its approval in July 2007, Afghanistan Customs Department in Kabul, the Inland Customs Depot the project has contributed to by helping in increasing customs building at Jalalabad, as well as strengthening the capacity of the revenues collection, reduce transport- truck parking facilities and other National Aids Control Program related trade costs, stimulate trade, allied infrastructure. The Trade (NACP) through (i) recruitment of Facilitation component of the project seven national advisors and one “Customs revenues has also demonstrated good results, international advisor; (ii) participation specifically for WTO accession review of NACP staff in national/international increased by more than of transit agreements with neighboring training activities; and (iii) exposure countries, improvement of freight of NACP staff to well performing HIV/ 700 percent in Solar forwarding industry, etc. Moreover, the AIDS programs abroad. The increased Afghan National Standards Authority capacity of NACP has resulted in the Year 1387 (2008/09).” (ANSA), which was established adoption of the Afghanistan HIV Code with the help of the project, has now of Ethics, an important milestone for reduce corruption, and streamline been approved as an independent the support and protection of people customs procedures at border government standards organization. living with HIV/AIDS in the country. crossings. Most project targets have The project is scheduled to close by To achieve its objectives, the NACP surpassed what were planned at the the end of 2010. As of date, all project has signed 12 contracts with national start of the project. Customs revenues funds are fully committed and planned and international organizations, increased by more than 700 percent activities complete. and the harm reduction activities in Solar Year 1387 (2008/09); this was have been initiated. Comprehensive largely attributable to computerized Building on the overall success of integrated biological-behavioral control over transit shipments, tighter the ECMTFP, and to continue with surveillance (IBBS 2009) has been control over the clearance of goods, the reforms underway, the World completed among priority populations and the enhanced capacity of the Bank Board approved a follow-on of injecting drug users, prisoners, Afghan Customs Department (ACD) project called the Second Customs female sex workers, and road staff. Trade volume has increased Reform and Trade Facilitation transport workers. The results of the many times over compared to the Project on June 25, 2010. This US$ survey have important implications for start of the project. One of the 50.6 million project is planned to Afghanistan’s AIDS program. Injecting project’s key achievements has been become effective in July, 2010. It drug use is the major source of new the automation of customs processes will finance technical assistance, HIV infections, with transmission with the Automated System for infrastructure, and equipment in order highest in Western Afghanistan. Customs Data (ASYCUDA). Customs to make Customs procedures less 10 Some 632 medium and large size traditional irrigation schemes, serving more than 660,000 ha of land in various parts of the country have been completed. cumbersome, globally aligned, for 755 sub-projects worth stimulating foreign direct and more transparent; reduce $73.2 million are ongoing; and investment through a program opportunities for collusion; 632 medium and large size of political risk insurance improve infrastructure, traditional irrigation schemes in an environment where equipment and human worth $48.5 million serving the perception of political resources supporting the more than 660,000 ha of land risk by foreign investors is reengineered processes; and in various parts of the country very high. The project is help in improving the overall have been completed. As a designed to stimulate private governance in ACD and help result of the rehabilitation, business activity and attract provide ACD sufficient control an additional 132,000 ha of foreign private investment resulting in improvement in the land area are now receiving in a variety of sectors. It will release of legitimate goods in irrigation supplies, and stimulate the local economy, a fair and efficient manner. crop yields have increased generate employment, create substantially. In addition, the tax revenues, and assist The Emergency Irrigation work under the Feasibility in the transfer of modern Rehabilitation Project Study of the Lower Kokcha technologies and business ($40 million Credit, $86.5 Irrigation and Hydropower practices to Afghanistan. million Grant, and $6 million Multipurpose Project on the Government Funds): The Kokcha River in the Amu River Despite the deteriorating project is helping to provide Basin has been completed, and business environment water to farms in the project the final report was submitted which impeded the flow of areas, with more reliable in April 2010. Installation of foreign direct investment and equitable distribution 105 of the 174 hydrology to Afghanistan, the AIGF of irrigation water. The stations in different part of the has been making steady rehabilitation of the national country has been completed. progress. To date, a total of irrigation system in all five Work on installation of 40 six guarantees have been river basins of Afghanistan Cableways has commenced. underwritten with the AIGF will help increase agricultural These facilities will enable for five beneficiaries covering productivity and farm income, measurement of river flows the agricultural, financial, improve food security and for future use in planning and pharmaceutical, construction, livelihoods, and reduce developing water resources in and telecommunication vulnerability due to droughts. the country. sectors. There are potential To date, six regional offices in projects which are now being Kabul—Jalalabad, Kandahar, The Afghanistan Investment examined. It is expected Balkh, Kunduz, and Herat— Guarantee Facility (AIGF), that some more guarantees have been established to in cooperation with Asian will be underwritten shortly. develop institutional capacity Development Bank (ADB), The total associated foreign at the local level. As of 31 Department for International investment of the projects May, 2010, 791 sub-project Development (DFID), and under the AIGF is about $107 proposals, costing about $93.8 World Bank’s Multilateral million with approximately million, had been prepared. Investment Guarantee 730 jobs created as a result. Of these, 776 sub-projects Agency (MIGA), aims to Given the importance of the totaling $90.0 million have assist Afghanistan in its project in attracting foreign been approved; contracts reconstruction efforts by direct investment, and at the 11 Rehabilitation of the 110kV In January 2010, the World Bank’s International transmission line from Naghlu to Development Association Kabul; 110kV new transmission (IDA) and the International Monetary Fund (IMF) agreed line from Chimtalla substation to to support US$1.6 billion in Kabul North- West; 110kV lines debt relief for the Islamic Republic of Afghanistan. from Kabul North-West to Kabul The Boards of Directors of both institutions agreed that North substation have been the country has taken the completed. necessary steps to reach the completion point under the enhanced Heavily Indebted request of Government of all targeted neighborhoods. North East Transmission Poor Countries (HIPC) Afghanistan, the closing date Almost 60,000 persons have System to allow for the of AIGF has been extended already received improved import of lower cost power Initiative. his will generate for two years from September services, and approximately from Uzbekistan into the city; total debt service savings of 30, 2009, to September 30, another 60,000 are in the rehabilitating the 100 MW 2011. process of receiving services. Naghlu Hydropower Plant US$1.6 billion. To date, the project has (the largest hydro generation Kabul Urban provided 92 kms of improved station in Afghanistan which Reconstruction Project access to homes through supplies power to Kabul) and Upon reaching the (KURP) ($25 million Credit grading and surfacing roads, the associated transmission completion point, and $5.6 million ARTF the provision of hillside steps line; and restructuring and Grant): This is a community and sidewalks, the repair commercializing the power Afghanistan also qualifies driven project that attempts and construction of 120 kms utility to improve service for debt relief under the to empower and develop of tertiary storm drains and delivery. Multilateral Debt Relief historically neglected urban 87 of water supply lines, communities, particularly in Among the project Initiative (MDRI). MDRI informal or slum areas, to “KURP provided 92 kms components, Naghlu hydro relief will lead to a nominal identify, plan, and monitor project rehabilitation work of improved access to needed development projects has been lagging and has reduction of debt to IDA by in their neighborhoods. not picked up as expected. homes through grading US$35 million. Afghanistan The project supports MEW, DABS and SMEC the reconstruction and and surfacing roads.” teams have been discussing does not have any MDRI rehabilitation of 20 of Kabul’s the issue with the contractor, eligible debt outstanding to neighborhoods/gozar where TPE. The parties agreed the majority of the urban poor improvement to 6,514 existing to a new work schedule to the IMF. live in informal settlements, latrines, implementation of a complete the rehabilitation of including four neighborhoods solid waste collection system the four units of the plant by in the Old City of Kabul. where a collector/sweeper June 2012. Consequently the The completion point marks contracts with the Shura, closing dates of IDA Credit the end of a process that Through community-based and health and hygiene and ARTF Grant has been Gozar Cooperative Shuras, campaigns on clean water extended from the original included clearance of arrears community needs are and sanitation. Furthermore, September 30, 2010 and and debt reductions by Paris integrated into a Community 7,017 street lighting systems June 30, 2010 respectively, to Club creditors since 1996, Upgrading Plan (CUP) have been installed so far. September 30, 2012. Of the covering water supply, four units, Unit no.4 is under and will ultimately result in access roads and drains, The Emergency Power rehabilitation and is expected a 96 percent reduction of sanitation, solid waste Rehabilitation Project to be back in service by management, and street ($105 million Credit and September 2010. Other Afghanistan’s external debt, lighting (i.e. urban services). $20 million ARTF Grant): units would be completed in equivalent to US$11 billion The CUP is converted into The project is working to 6-9 months interval. DABS engineering designs, cost, provide improved and more will decommission Unit in NPV terms. and implemented to achieve reliable supply of electricity no. 3 by early July 2010 an outcome of improved to the residents of Kabul. It is to hand over to TPE, the infrastructure in response to doing so by rehabilitating and contractor. MEW and TPE community needs for 92,000 expanding city distribution have been discussing on residents of Kabul. Thus far, networks; connecting the TPE’s contractual claims the project work is ongoing in Kabul city grid to the future and reached on an amicable 12 12 So far over 2,100 hectares of new orchards have been planted with grapes, apricots, almonds, and pomegranates. agreement in March 2010. development of AUWSSC; (ii) the third time, as the previous financial support to AUWSSC bid invitation did not result in The power supply to Kabul, operations; (iii) and, an responsive bids. Proposals for billing, and collection have extension of the Kabul water consulting services for external significantly improved. The supply system. The project auditors are under evaluation kWh supplied in the first four is financed in parallel by and proposals for technical billing cycles of the current the German Development assistance are being invited year 1388 has surpassed Cooperation Agencies from a short list of firms. the last full year (six cycles). (KfW and GTZ). Following Power import quantum has the announcement of the Emergency Horticulture and significantly increased and sector policy and institutional Livestock Project (HLP) ($20 has replaced expensive diesel development plan in October million IDA Grant and $34.3 power. DABS has started on 2005, a Presidential Decree million ARTF Grant): It is one a good note, by starting the to corporatize CAWSS was of the leading programs of the first consumer care center and issued in January 2006. The Government of Afghanistan in a hot line for supply-related Articles of Incorporation of the the horticulture and livestock complaints. new AUWSSC were approved sectors in the country. Overall by the Cabinet on July 9, the project continues to make Urban Water Sector Project 2007, and gazetted by the good progress. Under the ($40 million Grant): The Ministry of Justice on July 11 Horticulture Component, so project aims to initiate actions 2007; the Board of Directors is far, over 2,100 ha of new to: (i) transform the Central meeting regularly, the General orchards (grapes, apricots, Authority for Water Supply Manager, Operations Manager almonds, and pomegranates) and Sewerage (CAWSS) and Internal Auditor have been have been planted, and over into a technically viable selected and recruitment of 600 women participated in this operation; (ii) establish the other members (Financial program. Farmers contributed the financial sustainability Manager and Techncial 25 percent of the cost for the of the Afghanistan Urban Manager) of the management new orchards. An additional Water Supply and Sanitation team is underway. AUWSSC 900 ha of new orchards are Corporation (AUWSSC, took over the operation in planned for fall 2010. In CAWSS’ successor); (iii) Kabul, Charikar, Herat, Pul- addition to establishing new increase access to and i-Khumri, Kunduz, Taloqan, orchards, extension messages reliability of the water supply Mazar-e-Sharif, Shebergan, and inputs were provided for service in Kabul; and (iv) Mehterlam and Jalalabad. The the improvement of existing prepare a follow-up project government has requested a orchards owned by over under which more substantial restructuring of the project to 36,000 farmers. institutional and financial include part of the Short-Term objectives can be achieved and Program of Kabul water supply Under the Animal Health coverage further expanded in which was earlier planned Component, 114 government Kabul and provincial towns. under the ARTF-financed veterinary clinics have To achieve these objectives, project. Meanwhile, the bids for been transferred to trained the project includes three main the water distribution network veterinarians for private components: (i) institutional are to be invited again - for operation. The Poultry 13 Component helped poor women inception. Significant strengthening (ii) establishing industries in 4 key enhance their incomes from poultry of the Ministry of Mines departments sectors (light engineering, food production of the project. Under responsible for cadastre and mine title processing, leather garments, carpet this component, the 7,000 intensive management has been conducted washing and finishing); (iii) building poultry units that were started in July as well as training courses for the AISA’s (Afghanistan Investment 2009 have produced over 8 million Afghanistan Geological Survey. Support Agency) capacity in the eggs. An additional 4,000 poultry Mining regulations have been drafted Industrial Parks Development units will be established in 2010. and environmental regulations are Department (IPDD) and Research under preparation as well as other and Policy Department (RPD); and “An additional 900 ha of new guidelines and procedures for the (iv) creating capacity in the Private Ministry of Mines. Significantly, Sector Development Directorate orchards are planned for fall the project has stimulated private (PSDD) of Ministry of Commerce sector investment in Afghanistan by and Industries (MoCI) to design 2010.” facilitating the successful tender of PSD related policies. The capacity the Aynak copper deposit, one of the of IPDD has been substantially largest such deposits in the world. improved in financial management, Sustainable Development of The government has concluded procurement, environmental and Natural Resources Project ($40 the contractual agreements with social management, and project million Grant): The project supports the Chinese company which was supervision. However, the high staff measures to enhance regulatory awarded the tender. The total amount turnover has constrained the ability capacity, foster private sector of the investment will be around $10 to implement projects independently. development and adherence to billion over the next 5 to 10 years, and Similarly, a number of staff in PSD international standards. This project an initial payment of $80 million has department of MoCI have been is helping the government to ensure been received by the government. In trained to improve their capacity that the revenues from these valuable addition to strengthening the Ministry in undertaking policy analysis and resources are available to the country of Mines’ capacity to supervise the implementing projects. as a whole and are transparently mining sector, the project is helping managed. Among the approaches the government move towards its “Civil construction work the government will use to manage goal of ensuring transparency and the sector is the Extractive Industries good governance in the sector. The of the Hisar-e-Shahi Transparency Initiative – a set of government has taken the important principles that supports sector industrial park has been step of endorsing the principles of the governance via the full publication Extractive Industries Transparency completed.” and verification of company payments Initiative (EITI) and has been and government revenues from oil, awarded “candidate” status by the gas, and mining. In addition, an EITI secretariat in Oslo. Civil construction work of the park, International Advisory Council has which includes leveling, boundary been established to assist the Private Sector Development (PSD) walls, road work, storm water government in evaluating the Support Project ($25 million Grant): drainage and water supply system, is strengths and benefits of contracts to The project aims to stimulate the local now fully completed. This represents ensure that best practices are applied economy to generate employment, 40 percent of the total project cost. to help Afghanistan in developing its create income and alleviate poverty. The contract for design consultants for natural resources. It helps create an economic enclave wastewater treatment will be awarded for businesses operating in both the by July 30, 2010, as the technical Despite a number of constraints— domestic and export markets. The and financial reviews are already notably a difficult business project supports: (i) constructing completed. The major constraint environment—the project has an industrial park at Hisar-e-Shahi, that the project is experiencing is made steady progress since its 14 The Bank’s new Global Food Crisis Response Program helped rehabilitate some 500 small irrigation schemes. to provide power to the park. jobs in Afghanistan. Afghanistan Institution of The project was designed in Banking and Finance (AIBF). 2006, when the grid station Civil Service Reform Project The consultants for the was not available in Jalalabad ($20.4 million Grant): positions of audit and human City. Therefore, AISA had The project supports the resources commenced work at considered a diesel generator Independent Administrative the start of February 2010. The power plant to energize the Reforms and Civil Service other positions are currently park. Commission (IARCSC) and in the process of being re- key government ministries in advertised. DAB is expected Currently, the Asian improving their capabilities to award the contract for Development Bank (ADB) for management of human the IT consultancy package is financing a transmission resources. To meet this to an IT consultant by mid line from Naghlu (a district objective, the project July. This component aims of Kabul) to Jalalabad City supports the government to provide DAB with a five and building a Sub Station in in the development and year development action plan Jalalabad. Since the project is implementation of clear rules for IT and also to assist the located 20 km from Jalalabad and procedures for managing procurement, installation and City, it is possible to extend civil servants. The project also maintenance of the IT systems the ADB financed transmission supports core ministries to to be purchased under the line to Hisar-e-Shahi industrial reorganize their structures and project, namely off-site park and install a Sub Station staffing so as to better perform supervision, human resources to supply the power from the their tasks. In addition, the automation, collateral registry, grid to the park. A MOU has project supports ministries to and the public credit registry been signed between Da implement the Pay and Grade and is therefore crucial for Afghanistan Brishna Sherkat reforms. the overall success of project (DABS) and AISA, which implementation. states that DABS will provide Financial Sector 25 MVA hydropower to the Strengthening Project ($8 Through this project, the IFC Hussar-e-Shahi industrial park. million Grant): The project is also providing technical The transmission line from supports the Afghanistan assistance to the DAB in order Jalalabad City to the industrial National Development to establish two basic financial park and the Sub Station is Strategy’s vision to establish sector infrastructures in the going to be financed under a modern and competitive country: (i) a Public Credit the PSD Support Project. The financial sector. The project Registry that will provide contract for power distribution will specifically strengthen the lenders with information for network and street lighting capacity of Da Afghanistan efficient risk assessment on is awarded and the process Bank (DAB) in the areas borrowers; and (ii) a Collateral of hiring a design consultant of banking supervision, Registry for movable property for the transmission line and accounting, internal audit, and that will provide lenders sub-station is progressing. human resource management. with the ability to effectively The park is expected to be It will also develop necessary use borrowers’ property as operational in 2011. Once the financial infrastructure such collateral. IFC’s involvement project is fully implemented, it as a public credit registry, includes assistance in raising is expected to generate 6,000 collateral registry, and the awareness among the 15 How the Afghanistan Reconstruction Trust The Afghanistan Fund (ARTF) works: Reconstruction Trust Donors contribute funds into a single Fund (ARTF) was account, held by the World Bank in the US. The ARTF Management Committee makes established in April decisions on proposed allocations at its 2002 as a temporary monthly meetings, and those decisions means to finance the are translated into funds through Grant Agreements signed between the World government’s wage Bank and the Government of Afghanistan. bill. Now the ARTF has ARTF allocations are made through two developed into the main “windows”: the Recurrent Cost Window and the Investment Window. The Recurrent multi-donor funding Cost Window reimburses the government mechanism in the for a certain portion of eligible and non- country – financing both security related operating expenditure every year. The Investment Window provides the essential running grant financing for national development costs of government programs in the development budget. as well as key Afghan National Development relevant stakeholders, and Response Program provides a pilot safety net program providing advice regarding this assistance for the for needy households, with Strategy (ANDS) the necessary IT systems. rehabilitation of approximately a subsequent proposal for a programs across the Part of the IFC’s involvement 500 small irrigation schemes, scaled up national approach. in this project has already critical to the recovery of The project aims to develop country. The objectives been performed, including the country’s agriculture. So capacity in the Ministry of of ARTF are to: an assessment of the legal far, 433 of these schemes Labor and Social Affairs to and regulatory framework, have been financed of which plan and administer programs as well as its support in the 265 schemes have been in pensions and safety nets. • Position the national preparation of the necessary completed. These schemes new laws and regulations included cleaning of canals/ A F G H A N I S T A N budget as the key vehicle required for the establishment karezes, as well as building RECONSTRUCTION TRUST to align the reconstruction of this infrastructure. of protection walls, gabion FUND walls, water dividers, and program with national The Afghanistan Credit intakes. With rehabilitation The Afghanistan development objectives. Reporting Regulation was of these schemes, over Reconstruction Trust Fund approved by the Supreme 6,900 families in far remote (ARTF) is a partnership Council of Da Afghanistan areas of Afghanistan have between the international • Promote transparency Bank on June 05, 2010. The been provided with access community and the Afghan and accountability of new regulation will be in force to improved irrigation government for the improved after the official publication systems. The project also effectiveness of the reconstruction assistance in the Gazette, and can builds community capacity reconstruction effort. Until be considered one of the to implement and maintain May 21, 2010, 32 donors most modern in the region. irrigation sector projects that had contributed over $3.7 • Reduce the burden It allows both public and address community needs. billion since early 2002, on limited government private credit reporting to be making ARTF the largest established in Afghanistan. “Until May 21, 2010, contributor to the Afghan capacity while promoting It also introduces, for the budget—for both operating first time, ample borrowers’ 32 donors had costs and development capacity-building over privacy rights and allows for programs. ARTF’s support for time contributed over the establishments of Private national priority programs, for • Enhance donor Credit Bureaus in the future. $3.7billion to the operating costs of government It has been constructed operations and for the policy coordination for financing to attract leading private reform agenda is contributing ARTF.” and policy dialogue. providers (mandatory sharing to the achievement of and mandatory inquiries with Afghanistan Pension the Afghanistan National borrowers’ consent, closure Administration and Safety Development Strategy goals. of the PCR to inquiries when Net Project ($7.5): The the first PCB opens) and project is designed to improve Management: The ARTF is allows the participation of the administrative capacity of managed by the Management regulated and non-regulated the public pension system to Committee consisting of entities. ensure the effectiveness of the World Bank (as the a reformed pension scheme administrator), the Islamic Afghanistan Food Crisis for public sector employees. Development Bank, the Asian Response Project ($8 It will also develop a policy Development Bank, and the million Grant): The Bank’s framework for safety nets, UN (UNAMA and UNDP). new Global Food Crisis and on that basis implement The Management Committee 16 The ARTF’s Urban Water Supply Project (UWSS) provides support to government’s short-term (UWSS) program. meets regularly in Kabul, with of government including the high rates of disbursement the Ministry of Finance as an delivery of services such as are strongly influenced by observer, to carry out the day- healthcare and education. the sectors in which ARTF to-day business of the fund. Given that around 60 percent invests. Decentralized and Once a quarter, ARTF Donors of the non-uniformed Afghan national rural development meet to discuss broader civil service is accounted programs, such as NSP, strategy with the government for by teachers, the Ministry NRAP and Microfinance, have and ARTF Management. of Education has in general been strongly supported by the received around 50 percent ARTF. ARTF and Donor of total ARTF resources. Contributions: A total of 32 Ministries of Public Health, As of May 2010, there were 20 donors have contributed to Foreign Affairs, Labor, and active projects funded through the ARTF over the past seven Social Affairs and Higher ARTF, with a combined years. Donor contributions Education have also been commitment value of over have increased year after major recipients. It should also $1.03 billion; of this, $779.92 year, with new donors joining be highlighted that the ARTF’s million was disbursed. Full and older donors increasing RC Window resources are details of investment activities their levels of contribution. national in scope, ensuring the are provided in the ARTF Nevertheless, over the last few payment of salaries of around Quarterly Reports available at years the “preferenced” portion 250,000 non-uniformed civil www.worldbank.org/artf. of donor contributions has servants in all 34 provinces of been the main factor driving the country. Steady year-on- The ARTF-financed Urban growth. The agreed ARTF year increases in operating Water Supply and Sanitation rules are that donors may not costs across government mean Project (UWSS) provides “preference” more than half the RC Window accounts for a $41 million to support the of their annual contributions. declining share of the overall government’s short-term This rule is to ensure that the budget. Nevertheless, the RC UWSS program. The project ARTF has sufficient funding Window still finances around has five components: to finance the Recurrent Cost half of the non-security costs Kabul water supply, Kabul Window and that it retains of government. sanitation, provincial towns some flexibility in the approval WSS, engineering support of National Priority Investment The Investment Window: and technical assistance, and Projects. The Investment Window financial support to the Central has in the last two years Authority for Water Supply The Recurrent Cost (RC) increased significantly in and Sewerage (CAWSS) Window ($1.95 billion): To volume and scope. In the operations. The Kabul water date, the ARTF has disbursed last two years (SY1387 supply and provincial towns $1.95 billion through the and SY1388) investment WSS components are based government’s operating commitments have exceeded on feasibility studies that budget. Domestic revenues recurrent cost commitments. have been completed for continue to be insufficient to Disbursement rates on ARTF Kabul (financed by KfW) and cover the costs of government. investment have been very 11 provincial capitals served The ARTF Recurrent Cost strong with 75 percent of total by CAWSS. In addition, the Window has therefore investments disbursed as of ARTF has also financed ensured the basic functioning May 21, 2010. Consistently feasibility studies for 11 cities 17 which were not served by CAWSS. Metherlam and Jalalabad have been cleared. Energizing of feeder 07 was The Kabul sanitation component is taken over by AUWSSC. Extension successfully done and DABS at Mazar- based on the strategic sanitation of grant closing date by a year i.e. e-Sharif commenced providing service plan and associated master plan up to December 31, 2010 is being connection to the consumers. Delays covering municipal solid waste, on- considered to allow completion of the in issuance of customs clearance site sanitation, and sewerage and ongoing works in the provincial towns. letters, Letter of Credits, supply of storm water drainage. The investment concrete poles are causing the delays components are currently at various Kabul/Aybak/Mazar-e-Sharif Power in execution of the projects. Also, with stages of implementation. In particular, Project ($57 million) is working to the series of recent attacks in Kabul, new wells have been completed in provide reliable and quality power to the contractors have recalled a major Upper Kabul for water supply to the consumers in the target areas of the part of the work force till the situation city. However, as adequate financing cities of Kabul, Aybak, and Mazar- improves. This would impact project for the next three construction e-Sharif. The project would support progress unless the situation improves contracts is not available under the investments to: (i) strengthen the low- significantly. The final completion of project, they are to be financed by KfW voltage distribution network through the rehabilitation of distribution works and IDA. Contracts for (a) pipelines, rehabilitation/upgrading of old and is expected to be delayed by 6-8 equipment for wellfields and pumping dilapidated infrastructure in parts of months from the scheduled date of stations, and (b) collector pipes Kabul with the aim of improving the contract completion. and transmission mains are under reliability and quality of electricity execution with KfW financing. A few supply and services in the target areas, The construction work of customer small-scale interventions were carried as well as accountability of power care center has been started. out for the sanitation and rehabilitation utility; (ii) construct a new 220/20 kV Expected completion time is 4 months. of an existing dumpsite in Kabul. Goods substation and associated 20 kV lines The digital metering package for worth $10 million for water supply in at Aybak to provide quality, reliable, single and three phase consumers provincial towns have been procured, and clean grid power to the residents (the last under this project), has been new water sources have been created of Aybak town; and (iii) rehabilitate and ordered and the factory inspection in Taloqan, Maimana and Pul-e- augment the transmission facilities test has been completed. Installation Khumri and existing water sources for the medium- and low-voltage is expected to be complete by August have been strengthened in Shebergan distribution network in Mazar-e- 2010. USAID is funding the installation and Metherlam. All contracts for pipe- Sharif. In addition, the project would of these meters. laying in 12 towns and 4 reservoirs support institutional capacity building have been awarded (procurement for operation and maintenance of The project’s closing date of December of works for 2 reservoirs have been the distribution systems, as well as 2009 has been extended by 21 held back due to lack of funds). the establishment, operation, and months (till September 2011) after However, a funding gap of about $ handover to DABS (Da Afghanistan the mid-term review of the project’s 7 million exists. Financial support to Brishna Shirkat – Afghanistan Power progress. The earlier closing date was operations has been effective since Utility) of a customer care center in the aligned with the requirement to close August 2005 and was terminated in target area. the project 6 months before the main March 2007. The CAWSS operation ARTF closing date (previously June is being incorporated gradually into The implementation works for Aybak 2010 and extended to June 2020). the Afghanistan Water Supply and and Mazar distribution projects are Sewerage Corporation (AUWSSC). progressing well with major materials ARTF – Afghanistan Power Sector The water supply operations in 10 received at site. Major materials Development Project ($35 million): towns, namely, Kabul, Charikar, for Mazar Substation have been The project supports the Government Herat, Pul-i-Khumri, Kunduz, ordered. The foundation drawings of Afghanistan in increasing: (i) access Taloqan, Mazhar-i-Sharif, Shebergan, for Aybak substation work have been to grid power; and (ii) the quantity of 18 The ARTF’s Justice Sector Reform Project supports government efforts to strengthen a centralized state justice system. power available to consumers the consumers in the project of the remaining construction in the target urban centers areas has been processed. work was signed between of Pul-e-Khumri, Charikar, SMEC international, the same Gulbahar and Jabul-Seraj. The With a series of recent attacks consultant, and the Kabul project consists of the following in Kabul, the contractors have Municipality on May 29, 2010. two components: Distribution recalled a major part of the The work contractor has already System Rehabilitation, and work force until the situation started construction work on all Institutional Capacity Building improves. This would impact of the four road packages. The and Project Management project progress unless the construction work is expected Support to Ministry of Energy situation improves significantly. to be completed before the end and Water (MEW). The project The energy efficiency activities of this year. would support establishment of have picked up with USAID a unit within MEW to promote providing a complementing Afghanistan Justice Sector energy efficiency and saving. investment to MEW with Reform Project (Phase 1) ($27 some international technical million): In line with the ANDS There was delay in effectiveness consultants. ARTF-funded and National Justice Sector of the contracts, due to time staff is working with these Strategy (NJSS), the ARTF taken in opening of Letter of consultants on behalf of MEW. project’s development objective Credits. Notwithstanding the is to strengthen a centralized delay, the contractors started Kabul Urban Roads state justice system and to initial survey and design work Improvement Project ($18 increase access to justice on rehabilitation of distribution million): The Project aims to for the Afghan people. The networks for Pul-e-Kkumri, improve traffic flow on priority project’s immediate objective Charikar, Gulbahar, and Jabul- corridors or segments of the is to enhance the capacity of Seraj. Vendor approval has main urban roads in Kabul city. the justice sector institutions to also been undertaken for The Project will rehabilitate deliver legal services. This will major equipment. The work about 12 kms of existing roads; be achieved primarily through on the Charikar substation to construct and rehabilitate road more strategic human capital be funded by the Government side drains and walkways; and physical infrastructure of India is still to start. The construct roundabouts at key management, increasing team will continue to follow on intersections; and install street the skills of justice sector this through MEW, Ministry of lights. The Implementation professionals, and enhancing Finance and Inter-Ministerial Consultant (IC) has completed the physical infrastructure used Commission on Energy (ICE) the topographic survey, to deliver legal services. meetings. There was some geotechnical investigations and progress in internal approvals design for 75 km of roads under As the Government of of the Government of India their contract and has submitted Afghanistan and the authorities, as reported in last to the Kabul Municipality for final international donor community ICE meeting. MEW/DABS has approval. The IC terminated the agreed at the 2007 Rome in the interim provided some contract on August 27, 2009, on Conference on the Rule of Law power at 20 kV from Chimtalla grounds of non-payment of their in Afghanistan (convened by substation. The contract outstanding dues. The dispute Afghanistan and Italy and jointly for carrying out a survey to has now been resolved, and a chaired by the United Nations), understand electricity needs of new contract for the supervision there is an urgent need to 19 improve the coordination, integration, and funding of investments in the Afghan justice sector. As part of their Joint Recommendations, the Rome conference participants agreed to elaborate a comprehensive National Justice Program and establish a pooled funding mechanism to support the NJP. The conference invited the World Bank to assist in the design of the pooled funding mechanism and noted that the ARTF showed the most potential. The implementation of the NJSS and the National Justice Program is a long-term process which will require continuing support through a number of programs and projects, only some of which will be financed by the ARTF. It is hoped that the use of the ARTF as a significant source of pooled funding will facilitate a coordinated approach among international donors in the justice sector, reduce duplication, minimize transaction costs, and thus significantly increase the development impact of donor contributions in this sector. The Management Capacity Program (US$35 million) helps ministries to improve their capacity in key managerial areas over the medium term. This enables the government to manage resources more effectively and deliver results faster on the ground. The program funds qualified and highly professional Afghan staff, currently working in NGOs and international agencies, to work in critical positions in government to apply for ‘line’ civil service posts in areas such as financial management, procurement, human resource management, policy, and administration. This program directly funds about 100 senior level government positions in about 17 ministries, mostly focused on common functions. These positions are filled through a transparent and merit based recruitment managed by the Independent Administrative Reform and Civil Service Commission (IARCSC). All dollar figures are in US dollar equivalents. THE WORLD BANK IN AFGHANISTAN Website: www.worldbank.org.af Abdul Raouf Zia Benjamin S. Crow Telephone: 0093 (0) 700280800 Telephone: 001 (202) 473-5105 Email: azia@worldbank.org Email: bcrow@worldbank.org House 19, Street 15 1818 H. Street, N.W. Wazir Akbar Khan, Kabul, Afghanistan Washington DC, 20443, USA 20