Afghanistan Reconnected Event Report 2014

The Afghanistan Reconnected Process: Regional Economic Security Beyond 2014 High-Level Advocacy Events in DC and at the UN 1. Summary and Conclusions The EastWest Institute (EWI) hosted panel discussions on its Afghanistan Reconnected report in Washington, D.C. and New York on October 14 and 17. The event in Washington D.C. was held in cooperation with and at the premises of the United States Institute of Peace (USIP). The event in New York, involving several Ambassadors/Permanent Representatives and distinguished EWI board members, was held at the United Nations Headquarters under Chatham House rule. At both meetings, senior representatives of the governments of Afghanistan, the United States and Germany, with the participation of members of the private sector (primarily from Pakistan and India), shared their views with an audience of senior diplomats, academics, businesspeople and civil society.

As an international trust-building organization, the EWI promotes opportunities for economic growth both in Afghanistan and in the region, recognizing that economic prosperity is a prerequisite for security. EWI’s Afghanistan Reconnected Process promotes regional dialogue on post-2014 economic transition in Afghanistan, and highlights Afghanistan’s role as transit and trade hub, connecting economies and resources of Central and South Asia and beyond. The Afghanistan Reconnected Process report, published in May 2014, underscores the regional economic potential of Afghanistan and recommends measures to “reconnect” Afghanistan to the region. (urls for the link to the report.)

Panelists were in favor of this ongoing dialogue, the objective of which is to mobilize both governments and the private sector to work toward regional economic development. Please see a list of participants here. (Urls for relevant pages.)

There were several key messages:  The governments of Germany, the United Arab Emirates and the United States, along with regional actors and the larger international community reaffirmed their commitment to help Afghanistan “reconnect” to the region, through trade, transit, energy transmission and resource extraction opportunities, benefiting the countries in the region.  Participants sent a clear signal to the Afghan National Unity Government to improve governance and accountability, which is critical for improving service delivery, attracting investment and ultimately supporting job creation and growth. Some expressed optimism regarding the recent steps taken by the National Unity Government to address the issue of corruption and financial mismanagement,

particularly the reopening of investigations on the Kabul Bank crisis. The reform of the electoral system was also mentioned as a positive step towards more democratic governance. 

Acknowledgments were made that the Afghan government has signaled its resolve to work with the international community but is faced with more recommendations than it could possibly handle; while capacity building remains a long-term challenge, the government needs immediate advice on setting priorities. One of the priorities identified by the panel was reaching a political settlement with the insurgents and subsequently implementing a national reconciliation process.

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Participants recommended sustained support to the Afghan National Security Forces (ANSF) beyond 2014. A successful transition will depend on the capacity of the Afghans themselves to secure the country. However, leaving no foreign troops beyond 2016 might be unrealistic. Parallels were also drawn to historical post-conflict scenarios in South Korea and post-World-War II Europe.

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All attendees saw, on the one hand, the Afghans themselves holding the key to their own self-sustained economic development, but stressed, on the other hand, the importance of regional economic cooperation and foreign direct investment in Afghanistan. While certain positive moves were noted — such as India’s and China’s active roles in the Istanbul Process and talks between Afghanistan and Pakistan on extending the Trade and Transit Agreement to Central Asia and beyond—a stronger political will by Afghanistan’s neighbors (Pakistan, India, Iran, China and the Central Asian Republics) remains to be encouraged.

2. Recommendations Panelists called for the following concrete measures:  Speed the implementation of major intra-regional “game changer” economic projects, such as the CASA 1000 and TAPI. Progress was recently made when the Finance Ministers of Afghanistan and Pakistan agreed on transit fees for CASA 1000.  Continued commitment from the international community, with the United States in the lead, upon the recent signing of the Bilateral Security Agreement (BSA). Attract investment in mining and natural resources. This requires transparency, sound public finance, a predictable legislative framework, confidence in legal institutions and efficiency in dispute resolution.  Reconnect Afghanistan to the region through construction of cross-regional roads and rail lines.  Improve custom infrastructure, expedite border processing, upgrade regional trade related policies and agreements.  Establish a preferential regional tariff regime.  Address suboptimal usage of water resources in Afghanistan and pursue bilateral negotiations with its neighbors that depend on its water.  Develop human capital by investing in higher and vocational education.

3. Next Steps   

Engage Iran and China more actively in the ongoing dialogue process.

Develop actionable recommendations at the forthcoming November 2014 workshop in Istanbul, entitled “Afghanistan Reconnected: Businesses Take Action to Unlock Trade in the Region.”

Stimulate political will towards implementation of the recommendations by engaging governments and the private sector in a series of meetings to be held in 2015 in regional capitals.

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