Archives for July 2010

It didn't quite work out that way

Andrew Neil | 17:06 UK time, Tuesday, 20 July 2010


alanduncan.jpgBit of a clash today with Alan Duncan, a minister in the Department for International Development. Before the interview began he told me it was his first ministerial interview. I told him we'd be "gentle" with him. It didn't quite work out that way.

I asked him why we were increasing our aid to Afghanistan from £500m to £700m when his own department had reported that only £20 in every £100 that we were already spending was getting to the intended recipients and when there were reports of billions of dollars in cash leaving the country.

I'm not sure he knew about his departmental report but he maintained that the money flight was probably drug money. In fact, the Wall Street Journal investigation of June 25th on which my question was based made it clear that the money leaving the country included "aid and logistical" money as well as drug money -- and reported that "massive infusions of poorly-monitored Western dollars were helping foster a culture of graft."

It reported that over $3 billion had been openly (ie officially recorded) as having flown out of the country in the past three years, often in sums so large that it was piled on to pallets. Since Afghanistan's GDP is only $13 billion that means almost a quarter of it left the country in cash in three years, some of it aid money meant to help some of the poorest people in the world. Most of it went to Dubai, which means aid money has probably bought more million-pound condos there that it has built schools in Afghanistan.

And that's only the money that is officially recorded as leaving the country. Include the cash being secretly smuggled out and Afghan and US officials believe around $10m a day is leaving the country -- around $3.65 billion a year. Afghanistan is not so much short of money as short of money that stays in the country.

For that reason the US Congress has frozen further aid pending an investigation. The British government has decided to increase its aid by 40%.

Click here to watch Andrew Neil and Alan Duncan on the Daily Politics (July 20)

If, as Mr Duncan maintained, most of this cash flight is drug money -- and we don't know how much might be -- I'm not sure that makes a difference: a sensible and non-corrupt government in Kabul would impound it and spend it on its people. In fact, most of the money seems to be leaving with the connivance of the Karzai government. The Journal reports the Chief Customs Officer at Kabul Airport saying his men found a "pile of millions of dollars", all undeclared, and tried to stop it being put on a flight to Dubai; but "there was lots of pressure from my higher ups" not to interfere. The money left.

Meanwhile, despite the billions and billions of Western aid -- as much as $40 billion, in fact -- which has flowed in to the country since 2001, an Afghan woman dies every 30 minutes from pregnancy and a child dies every two minutes in a country which is still one of the worst places on earth to live. I suspect most Brits would happily see a bit of their tax go to alleviate this sort of abject poverty -- if they could be sure that's what it was doing and that Kabul had a government which was making its own contribution. But both points are moot, which is why I pressed the minister.

He's promised to come back on to the Daily Politics. I hope he does.

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