92601 Country Update ISSUE 045 NOV. 2014 “ This is a very good project, and I’m very happy ” here now. This is a good life for us. page 36 page 4 page 6 page 24 page 26 world bank ongoing IFC advisory afghanistan group support operations services projects reconstruction trust fund / The World Bank Group in Afghanistan/3 CONTENTS ongoing ARTF Scorecard NEWS operations facilitates dialogue world bank page 6-23 results 13 world bank economic update: group support ‘Village clinic in page 4 -5 page 6 northern Afghanistan’ The ARTF Scorecard establishes links to: credible reforms needed to restore page 4 education and training (i) The broader development strategy in Afghanistan as defined in the confidence and fiscal stability page 9 The World Bank’s recently released bi- explanation, increasing weaknesses in tax World Bank projects and financial sector Afghanistan National Development annual Afghanistan Country Economic and customs compliance are a large part programmes Strategy and operationalized in the Update showed the country’s sharp slow- of the problem. Even with austerity mea- page 10 National Priority Programs; International Finance down in economic growth in 2013 to 3.7 sures, the unfinanced fiscal gap is estima- health Corporation (ii) The Tokyo Mutual Accountability percent (estimated), which slowed further ted at about $500 million for 2014. While Framework, which sets out to 1.5 percent (projected) in 2014, from 9.4 part of this could be financed from cash Multilateral Investment page 11 percent per year during 2003-2012. Uncer- balances, it is estimated that at least $300 Guarantee Agency infrastructure results 17 commitments of the Government tainty since 2013, over the political and million in additional financing will be ‘Irrigation canal’ and the international community security transition, has been compounded needed for 2014 to cover civilian salaries, page 20 to assist Afghanistan during the by the protracted elections impasse in 2014. pensions, and critical operating and deve- page 5 rural development transition phase and Investor and consumer confidence have lopment spending. This will need to be ac- Interim Strategy Note, transformation decade; slumped and led to a sharp reduction of companied by serious reforms to improve page 22 2012-2014 new investment commitments in the non- revenues. social safety net (iii) The National Risk and Vulnerability agricultural sectors. Agricultural produc- Addressing Afghanistan’s formidable Afghanistan Assessment, which tracks key tion has been robust in 2013-2014, but flat development challenges will require re- Reconstruction Trust Fund page 23 from the record levels of 2012. forms in three areas: (I) restoring fiscal sta- urban development indicators on poverty, employment, Afghanistan faces a deteriorating fiscal bility; (II) restoring confidence and creating Japan Social and human development at the crisis in 2014, with declining revenues lea- private-sector jobs; and (III) strengthening Development Fund national level; ding to an unfinanced fiscal gap, depleted social cohesion and service delivery. Above (iv) The World Bank’s Corporate cash reserves, and accumulating arrears. all, high level commitment to tackle cor- Domestic revenues have continued to wea- ruption and strengthen governance across Scorecard and the President’s IFC advisory Delivery Unit; and ken, with the authorities anticipating reve- the board will be critical. services projects nues of AFN105 billion ($1.82 billion) or 8.7 page 24 -25 (v) The Access to Information Policy percent of GDP for fiscal 2014. This would cThe report is available on: represent a further decline from revenues http://documents.worldbank.org/curated/ and Open Data Initiative of the of 9.7 percent of GDP in 2013, itself down en/2014/10/20310386/afghanistan- World Bank. from a peak of 11.6 percent in 2011. While economic-update the economic slowdown is part of the afghanistan reconstruction trust results fund page 26 -38 31 ‘Farmer f ield schools’ artf scorecard shows strong results in key sectors On October 13, 2014, the second annual Afghanistan effectively in its development performance on operational effectiveness page 26-27 Afghanistan Reconstruction Trust Fund progress. The ARTF Scorecard facilitates and quality of the project portfolio. The what is the artf (ARTF) Scorecard was released, providing dialogue between Government, ARTF Scorecard showcases that the ARTF is fully how the artf works detailed information on the overall per- donors and the World Bank as the ARTF aligned with government priorities at the formance and results achieved by the Administrator on portfolio performance, strategic and programmatic level. page 28 ARTF and the Government of Afghanistan project results, challenges, and areas in ongoing projects through ARTF-financed projects and pro- need of attention. The ARTF Scorecard 2014 cThe ARTF Scorecard is available on: grams. A four-pillar structure presents a highlights impressive results in education, http://www.artf.af/images/uploads/ transparent assessment of how the ARTF, health, rural development, agriculture, artf-scorecard2014-finalrevise.pdf as a multi-donor trust fund, is supporting and key policy reforms as well as a strong 4/  Country Update/ / The World Bank Group in Afghanistan/5 WORLD BANK GROUP SUPPORT The World Bank Interim Strategy World Bank projects the state, and channeling donor resources senior-level business development missions Note for Afghanistan Japan Social through the government to ensure invest- to Afghanistan on a quarterly basis. IFC Ad- and programs ments are aligned with national priorities. visory Services is also very active in Afgha- Afghanistan, Reconstruction Development Fund To this end, the World Bank works closely nistan with eight active projects during the 2012-2014 Trust Fund The Japan Social Development Fund (JSDF) Since April 2002, the World Bank’s Interna- with other multilateral and bilateral agen- reporting period. tional Development Association (IDA) has cies across a number of sectors where aid c For more information: see page 24. was established by the Government of Japan The Afghanistan Reconstruction Trust Fund committed over $3.07 billion for develop- coordination and government ownership The World Bank’s approach is to in 2000 as a means of supporting activities (ARTF) is a partnership between the interna- ment and emergency reconstruction pro- jects, and five budget support operations in are most critical. c For information about completed projects: Multilateral support GoA in implementing tional community and GoA to improve effec- which directly respond to the needs of poor and vulnerable groups, enhance their capaci- elements of the most important Afghanistan. This support comprises over www.worldbank.org.af – Projects & Investment National Priority Programs in a tiveness of the reconstruction effort. As of September 31, 2014, 33 donors have contribu- ties, and strengthen their empowerment and $2.63 billion in grants and $436.4 million in no-interest loans known as ‘credits’. The Programs. Guarantee Agency way that will build legitimacy ted over $7.3 billion, making ARTF the largest participation in the development process. The fund is administered by the World Bank. contributor to the Afghan budget – for both The Government of Japan and the World Bank has 15 active IDA projects in Afgha- nistan with net commitment value of over International The Multilateral Investment Guarantee and capacity of the institutions. operating costs and development programs. Bank agreed to set up a special window with- One of GoA’s greatest prio- ARTF’s support for National Priority Pro- $1 billion. Finance Corporation Agency (MIGA) has $155 million of gross ex- posure in Afghanistan, supporting telecom- rities will be to build domestic grams (NPPs), operating costs of government in the JSDF to support activities in Afghanis- The World Bank has provided advice to tan under a multi-year program of assistance munication and agribusiness projects. MIGA operations and the policy reform agenda help the Government of Afghanistan (GoA) The International Finance Corporation (IFC), sources of growth and jobs to for the country’s reconstruction and transi- recently launched its ‘Conflict Affected and is contributing to the achievement of the manage donor funds effectively and trans- the World Bank Group’s private sector deve- replace donor/military assis- tion toward political, economic, and social Fragile Economies Facility’, which will boost Afghanistan National Development Strategy parently. The Bank also supports the govern- lopment arm, continues to work with its stability. the agency’s capacity to insure investments tance and to sequence NPPs to goals. More than $3.1 billion have been dis- ment by providing analytical work on the investment and advisory service partners in As of September 2014, JSDF’s total com- in Afghanistan. The telecommunication pro- concentrate on foundational bursed to GoA to help cover recurrent costs, economy, public administration, gender, Afghanistan. IFC Investment Services now mitment had reached $81.3 million. A num- ject (MTN) is also receiving financing from such as civil servants’ salaries, and over $2.32 poverty, opium economy, and public finance has a committed investment portfolio tota- investments for growth. ber of JSDF-financed projects have so far IFC. The two agribusiness projects are in billion had been made available, both for management. ling some $135 million in five companies, Under this Interim Strategy been completed. dairy and cashmere production. closed and active investment projects. As of The Bank has actively supported key which include commitments in the financial, Note period, the Bank’s program c For more information: September 2014, 20 projects are active under reforms, particularly in the fiscal and pu- telecommunication, and hospitality sectors. http://go.worldbank.org/U5OQZVF200 n is built around three interlocking ARTF (including the Recurrent Cost Window) blic aministration spheres, and through IFC is exploring investment opportunities with net commitment value of $5.34 billion. its budget support operations. It has advo- across the manufacturing, financial markets, themes: c For more information: see page 26. cated building capacity and legitimacy of and infrastructure sectors, and undertakes • Building the legitimacy and capacity of institutions. • Equitable service delivery. • Inclusive growth and jobs. 6/  Country Update/ / The World Bank Group in Afghanistan/7 ONGOING OPERATIONS / education and training QEGs under EQUIP I and II (of which 5,045 received a total amount of $14.3 million as Second Education a first generation grant during EQUIP I and 11,542 schools received a total amount of Quality Improvement $22.9 million during EQUIP II). Program (EQUIP II) c IDA Grant $65 million c ARTF Grant $408 million Afghanistan Skills EQUIP’s objective is to increase equitable ac- Development Project cess to quality basic education, especially for c IDA Grant $20 million girls, through school grants, teacher training cARTF Grant $18 million and strengthened institutional capacity with (Closed on June 30, 2014) support from communities and private pro- viders. Program interventions are primarily The project was designed to increase the targeted toward general education, teacher number of immediately employable skilled training and education management. The persons by building in stages a high qual- program is fully aligned with the Afghanistan ity Technical and Vocational Education and National Education Strategic Plan and sup- Training (TVET) system that is equitable, ports the institutional development of the market responsive, and cost effective. More Ministry of Education’s program staff. specifically, the project aimed to develop a As of June 2014, EQUIP II has supported demand-driven vocational education and the construction of 838 schools: 241 schools training system, and encourage the provision using National Competitive Bidding (NCB), of autonomy to training institutions to tailor i.e., for larger and technically complex build- their programs to the needs of the labor mar- ings, and construction and/or rehabilitation ket, and establish linkages with employers. of 597 schools using Community Contracting The project had three components: A student in the library Component 1: Mainly focused on the es- at the National Institute (CC). In addition, 283 (178 CC and 105 NCB) of Management and schools are under construction. There are 3.1 tablishment of the Afghanistan National Accounting that was set million students currently studying in EQUIP- Qualifications Authority (ANQA), Afghanistan up under the Afghanistan Component 3: Under this component, These have been shared with other develop- National Qualifications Framework, and Skills Development Project training was provided to youth, as well as to ment partners and other ministries, in addi- supported schools, 1.3 million (40 percent) of (ASDP). ASDP aims to whom are girls. Overall, there are 8.04 mil- Awarding Boards. The documents developed increase the number of some vulnerable groups. The implementing tion to the Deputy Ministry TVET (DMTVET), lion children, of whom 40 percent are girls, so far are being exposed in phases to the immediately employable agency was the National Skills Development which is in the process of aligning its cur- stakeholders. graduates by building Program (NSDP) unit, and nearly all of the ricula to these Standards. enrolled in the General Education System in a high quality technical Afghanistan. Component 2: The National Institute of and vocational education programs contracted out for the training The project training delivery to chronically Thus far, social mobilization activities Management and Administration (NIMA), and training system. of about 7,500 youth, marginalized farm- poor women, youth, and injectable drug us- have been conducted in 14,125 communi- set up under the project, implements compe- The project covers the ers and chronically poor women have been ers reached 10,000 trainees. A Third Party cost of education, which ties, which have led to the establishment of tency-based curricula for its academic pro- is normally prohibitive completed. verification of the non-formal training course 14,125 school management shuras (councils). grams. The first batch of about 1,500 students for students from the By end of this project on June 30, 2014, has confirmed earlier findings of rise in wag- Taking into consideration the schools’ needs, in Accounting, Management, and Information provinces. major results under this project included: the es after training for both men and women. the shuras have developed 13,412 school im- and Communication Technologies (ICT) grad- Committee on Education and Skills Policy, NIMA has now become a corresponding provements plans (SIPs) nationwide. Based uated in July 2011. Of these, 1,058 students chaired by the First Vice President, has devel- member of the Accreditation Council for on the SIPs, Quality Enhancement Grants were given diplomas by the University of oped the basic roadmap of activities for (a) Business Schools and Programs (ACBSP). (QEGs) were distributed to schools that are Jyvyskala, Finland. The project provides aid a Draft National Qualifications Framework ACBSP accredits business, accounting, and used for purchase of school supplies, labo- to five other institutions under the Ministry (TVET); and (b) a draft legislation for the business-related programs at the associate, ratory equipment, and other materials that of Education that requires them to establish ANQA. In addition, 140 National Occupational baccalaureate, masters, and doctoral degree help strengthen the learning environment. their governing councils with a strong private Skills Standards have been developed under levels worldwide. So far, a total 16,587 schools have received sector involvement. the National Skills Development Program. Country Update/ ongoing operations 8/  / The World Bank Group in Afghanistan/9 Second Afghanistan / financial sector Skills Development Access to Finance Project Project c IDA Grant $55 million c IDA Grant $50 million The project’s objective is to increase the po- The Access to Finance Project aims to build tential for employment and higher earnings the government’s institutional capacity to of graduates from Technical and Vocational Education and Training (TVET) schools and improve access to credit of micro, small, and Small family businesses institutes through improvements in the skills medium enterprises. The project was de- such this garment delivery system. The project focuses on pro- company have benefited clared effective on April 17, 2014, and has the viding incentives to schools and institutes from the support of the following components: Microfinance Investment offering formal TVET programs through a Component 1: Improving access to finan- Support Facility for challenge fund scheme, while simultane- Afghanistan, which cial services for micro and small enterprises. ously strengthening the institutional system encourages innovations This component aims to provide continuing to increase access and for TVET as a whole. The project has four support to the microfinance sector through usage of financial services components: from micro and small the Microfinance Investment Support Facility Component 1: This component essentially enterprises. The owner of for Afghanistan (MISFA), as well as, support- the family business is seen focuses on (a) the formulation of a detailed here with a machine that ing MISFA to take on a broader role as a cata- TVET strategy and plan which would also be embroiders traditional lyst for innovations to increase access and Afghan clothing designs. usage of financial services from the lower in line with the National Priority Program 1, National Education Strategy Plan-II, and the end of the market (notably micro and small Interim Strategy Document published by the enterprises) according to its new strategic government, and an implementation pro- plan. It should, however, be underlined that gram; (b) developing quality standards for schools and institutes will be given an award the technical assistance cost for a skills team, In partnership with the International Labor Management Information System has the role of MISFA is primarily that of market skills delivery; (c) designing and implement- of $30,000 in kind. The second step will con- as well as costs of third party monitoring Organization and an international certifica- been established and progress has been facilitator, rather than direct technical assis- ing a labor market information system and sist of selecting a number of schools and in- and evaluation, and a public awareness cam- tion agency, graduates from these institutes made to set up an Education Management tance provider. an overall MIS for the TVET system; (d) ca- stitutes (approximately 15 over the life of the paign. The public awareness campaign will and schools will receive internationally rec- Information System and Labor Market Component 2: Improving access to finan- pacity building of monitors and inspectors of project), which, through a detailed business sensitize high school graduates on the type ognized certification of their skills. To date Information System for TVET. The recruit- cial services for small and medium enterpris- schools and institutes accredited by DMTVET; plan, demonstrate a willingness to sustain of training provided by various institutions as 1,108 graduates from the National Institute ment process for hiring a consultant for es. The aim is to increase commercial bank and (e) conducting certification examinations these good practices and/or to introduce new well as the quality of the training. of Management and Administration re- public awareness toward TVET education is and microfinance institution (MFI) lending for TVET graduates and related activities. ones. The selected schools and institutions As of September 2014, project progress ceived an International Certificate from the currently underway. to small and medium enterprises (SMEs) in Component 2: This component includes a will be provided development grants. included 15 TVET schools and institutes University of Jyvyskala, Finland, and Ball Business Plans of NIMA, Afghanistan Afghanistan and thus facilitate their access program for the recognition of schools and in- Component 3: This component is specifi- nationwide selected to receive the recog- State University, USA. In the meantime, 300 National Institute of Management, Blind to financial services. It will support the ex- stitutes that have already implemented some cally directed towards developing an infra- nition grant of $30,000 and to scale up or TVET graduates received scholarships under School and Technical Teacher Training pansion of the Afghanistan Credit Guarantee good practices to improve academic man- structure for in-service training for technical replicate good practices in delivering skills. the Award of Voucher Program to upgrade Institute have been received and approved as Facility. It will also support technical assis- agement, reform school administration, at- teachers and to build a pool of master train- Subsequently, these beneficiaries are re- and strengthen their competencies by pursu- their long-term commitment in the sector tance to commercial banks to strengthen tempts to find placements for students or to ers. It is proposed to train 750 technical ceiving supplementary technical assistance ing an International Certification program in under the project. The majority of second their SME lending capacity. This component establish linkages with local industries, cur- teachers and at least 60 master trainers by for the preparation and implementation of various fields. batch Voucher beneficiaries, who receive fi- will include support to the Credit Guarantee ricular reform at the local level, and practical the end of the project. Business Development Plans and five-year An In-service Technical Teacher Training nancial support from DMTVET, has started Facility to provide coverage to MFI lending to steps to deal with student welfare, etc. Such Component 4: This component finances business plans for their institutes. Institute has been established. A Project classes at the American University in Kabul. the lower end of the SME market. Country Update/ ongoing operations 10/  / The World Bank Group in Afghanistan/11 Afghanistan Financial / health / infrastructure Sector Rapid System Enhancement Afghanistan Response Project for Health Action in Information and c IDA Grant $25.7 million Transition (SEHAT) Communication The project is assisting the Da Afghanistan Bank (DAB) to develop a set of action plans Program Technologies (ICT) to improve banking supervision and imple- c IDA Grant $100 million Sector Development c ARTF Grant $270 million ment a modern payment system for effi- cient and transparent payment transactions. c Multi Donor trust fund for health Project Specifically, the project aims to allow DAB to results innovation $7 million c IDA Grant $50 million accurately assess the financial situation of 10 The program aims to expand the scope, qual- The project builds on the success of earlier commercial banks through audits conducted ity, and coverage of health services provided projects and catalyzes the next phase of ICT in accordance with international standards. to the population, particularly for the poor, development in the country. It will support The audits will lead to the development of in 22 provinces, and to enhance the Ministry policy and regulatory reforms and strategic action plans to address weaknesses that are of Public Health’s (MoPH) stewardship func- infrastructure investment to expand connec- identified, with oversight from DAB. tions. The project supports the provision of tivity and enable more users to access high The project also aims to modernize the basic health and essential hospital services in quality mobile and internet services. It will national payment system with the goal of re- both rural and urban areas. It also strength- also help mainstream the use of mobile ap- ducing the use of cash transactions, currently ens the national health system and MoPH’s plications to improve public service delivery the main means of making payments in capacity at central and provincial levels, so and program management in strategic sec- Afghanistan, and transitioning to electronic, it can effectively perform its stewardship tors in the government. The project will help card or mobile payments. The project will also functions. The project includes the following develop the local IT industry by expanding provide further support to the Afghanistan Institute of Banking and Finance (AIBF) to al- components: the pool of skilled and qualified IT profes- A Chief Medical Officer low it to scale up its activities, in order to in- Component 1: Sustaining and improving sionals, and supporting the incubation of ICT attends to a patient at crease the availability of banking sector skills. the basic package of health services and es- the Sar-e-Hause medical companies in Afghanistan. The project was restructured and an ad- sential package of hospital services: sup- health clinic in Parwan As of September 2014, major milestones Province. It is one of many ditional financing to the project ($6.7 mil- ports the implementation of these services Component 3: Strengthening program health facilities increased from 496 in 2002 clinics supported by the under the project include progress in con- lion) was approved in November 2013. The through performance-based partnership management: supports and finances costs to more than 2,000 in 2012, while at the System Enhancement for struction of optical fiber cable and comple- Health Action in Transition tion of about 200 kilometers of ducting and additional financing aims to support se- agreements between MoPH and non-gov- associated with system development and same time the proportion of facilities with (SEHAT) Program. SEHAT lected technical assistance activities origi- ernmental organizations, which will deliver stewardship functions of the MoPH including female staff increased. supports the provision of the first nodes on the northeast segment nally financed under the Financial Sector health services as defined in these packages. incremental operating costs at central and Despite significant improvements in the basic health and essential are being operationalized. The Ministry hospital services in both of Communications and Information Strengthening Project, which closed in June Component 2: Building the stewardship provincial levels and technical assistance. coverage and quality of health services, rural and urban areas. 2014. The additional financing covers two capacity of MoPH and system development The Afghan health system has made con- as well as a drop in maternal, infant, and Technology has adopted an open access poli- main activities: (i) targeted activities to by supporting the following thematic ar- siderable progress during the past decade under-five mortality, Afghanistan health in- cy for the national backbone network, ensur- strengthen DAB’s capacity, and (ii) establish- eas: strengthening subnational government; thanks to strong government leadership, dicators are still worse than the average for ing non-discriminatory access to wholesale ment of a Public Credit Registry. strengthening the healthcare financing direc- sound public health policies, innovative ser- low income countries, indicating a need to Internet bandwidth for all firms. A total of The audits of the 10 commercial banks, torate; developing regulatory systems and vice delivery, careful program monitoring further decrease barriers for women in ac- 450 Afghans have been trained under the started in November 2011, were completed capacities for ensuring quality pharmaceuti- and evaluation, and development assistance. cessing services. Afghanistan also has one IT skills development program. A job fair in June 2012. Presentations on the audit cals; working with the private sector; enhan- Data from household surveys (between 2003 of the highest levels of child malnutrition in for 500 successful trainees is planned for findings were given in June and July 2012 to cing capacity for improved hospital perfor- and 2011) show significant declines in mater- the world. About 41 percent of children un- October 2014. The program will train 1,500 development partners. A Movable Collateral mance; strengthening human resources for nal and child mortality. The under-five mor- der five suffer from chronic malnutrition, and Afghans by its conclusion. The first round of Registry was established in February 2013 health; governance and social accountability; tality rate and infant mortality rate dropped both women and children suffer from high the Innovation Support Program awarded 11 and a Public Credit Registry was launched in strengthening the Health Information System from 257 and 165 per 1,000 live births to 97 levels of vitamin and mineral deficiencies. local innovators for their ideas on how mo- December 2013. The process for moderniza- and use of information technology; strength- and 77, respectively. The maternal mortality bile technologies could help address nine tion of the payment system (national card ening health promotion and behavioral ratio is 327 per 100,000 live births, compared challenges in various sectors including agri- and mobile payment switch) is in progress. change; and improving fiduciary systems. to 1,600 in 2002. The number of functioning culture, education, and health. Country Update/ ongoing operations 12/  results village clinic in northern afghanistan provides frontline health care • A sub-medical clinic in a tiny village is the first link in the chain of medical care available in Kholm District. • With few resources and no electricity, the clinic provides much needed basic medical care and counseling to villagers, many of whom live in poverty. • It is one of many clinics across the country supported by the SEHAT program, which aim to expand the quality and coverage of health services. U LGATO VILLAGE, Balkh Province – In this tiny Afghan village, people seeking medical help find it behind a delicate lace curtain deco- rated with peacocks. Draped over the door of a traditional dome-roofed, mud-baked home, the decorative white curtain is Dr. Ahmed Seyarr Rahimi’s way of welcoming patients from Ulgato village to his cli- nic. Outside, harsh desert-like conditions create a stark contrast. “It is a difficult life for people here,” says Rahimi, 30. “Many are very poor and coping with big problems. I just want them to know we’re here to help.” Rahimi and his sister-in-law, Nooria, a trained midwife, are the only staff at Ulgato’s sub-medical clinic, which opened six years ago. Together they serve a population of some 4,300 people, generally treating about 35 patients every day. There is no electricity at the clinic. Medical equipment must be battery operated. “ The sub-medical clinic is located about 45 kilometers east of Mazar-i-Sharif in Afghanistan’s northern Balkh Province. It is operated by the Afghan NGO, Coordination of Humanitarian Assistance (CHA), contracted by the We are doing all the small things Ministry of Public Health (MoPH). It is part of the MoPH’s System Enhancement for Health Action in Transition Care and counseling The Ulgato sub-clinic is the first link in the chain of me- for people, not operations. (SEHAT) program, supported by the World Bank and dical care available in Kholm District, and offers basic Afghanistan Reconstruction Trust Fund. medical care: injections, medicine, birth control coun- The program’s objective is to expand the scope, quality seling, and help and advice for mothers with babies. We are explaining everything about different diseases and and coverage of health services provided to the Afghan “This is the first step for them,” explains Rahimi. “We ” people, particularly the poor, women, and children are doing all the small things for people, not operations. if we can solve the problem, in 22 provinces, and to support the MoPH’s efforts at stewardship. We are explaining everything about different diseases and if we can solve the problem, we do. But if they need Afghanistan has made impressive progress in the to go to the district hospital, we send them there.” we do. health sector in the past decade. Deaths of infants and children aged under five years, and pregnancy-related Midwife Nooria delivers babies and works with women who are not allowed to seek treatment from mortalities have already dropped dramatically. The num- –Ahmed Seyarr Rahimi, doctor, Ulgato Village ber of functioning health facilities increased from 496 in a man. Many people in the village eke out a living by harvesting clumps of fragrant cactus brush from the 2002 to more than 2,000 in 2012, while at the same time nearby mountains, or have relatives working in places the proportion of facilities with female staff increased. like Iran. Country Update/ ongoing operations 14/  / The World Bank Group in Afghanistan/15 A local farmer looking at a filter in a secondary canal that allows farmers to filter detritus and also direct water flow according to their Central Asia South irrigation needs. New and rehabilitated irrigation Asia Electricity canals as a result of the Irrigation Restoration Transmission and Development Project are allowing farmers and Trade Project to increase their crop production. (CASA-1000) c IDA Grant $526.5 million On March 27, 2014, the World Bank Group’s Board of Directors approved $526.5 million in grant and credit financing for the Central Asia South Asia Electricity Transmission and Trade Project (CASA-1000) for four countries: Afghanistan, Kyrgyz Republic, Pakistan, and Tajikistan. This transmission infrastructure project will put in place the commercial and institutional arrangements as well as the infrastructure required for 1,300 mega- watts (MW) of sustainable electricity trade. The total project cost is estimated at $1.17 billion and several other development part- ners will provide financing for CASA-1000, including the Islamic Development Bank and United States Agency for International Development. CASA-1000 will build more than 1,200 kilometers (km) of electricity transmission lines for associated sub-stations to transmit excess summer hydropower energy from ex- isting power generation stations in Tajikistan and the Kyrgyz Republic to Pakistan and Afghanistan. The project finances the engi- neering design, construction, and commis- sioning of transmission lines and three new converter stations. The power generation design, construction, and commissioning Irrigation Rehabilitation Project closed in December 2012. It supports the rehabilitation of irri- pre-feasibility study had selected seven dam sites in the northern provinces and the feasi- stations that provide the energy to be traded of a 300-MW converter station in Kabul. over CASA-1000, including Toktogul in Kyrgyz Afghanistan is expected to connect more Restoration and gation systems serving some 300,000 hec- bility study for six dams have been submit- Republic and Nurek in Tajikistan, are already households and businesses to the power grid Development Project tares of land, and design and construction of a limited number of small multi-purpose ted (the seventh site is not accessible for drilling) and is under review. The completed in place. by importing 300 MW of electricity through Of the total project financing, Afghanistan CASA-1000. Da Afghanistan Breshna Sherkat (IRDP) dams and related works, while establishing parts of the feasibility study report for three will receive $316.5 million in the form of an (DABS), Afghanistan’s electricity company, c IDA Grant $97.8 million hydro-meteorological facilities and services. remaining dam sites have been submitted IDA grant. The grant will support construction and the Ministry of Energy and Water will im- As of end August 2014, progress had been according to the contract. In the hydro-met c ARTF Grant $48.4 million of about 560 km of overhead transmission plement Afghanistan’s portion of this project, made in all areas. In the irrigation compo- component, installation of hydro-meteoro- c Government Funds $2.5 million lines to connect the electricity network via the including a Security Management Plan for nent, approximately 20,000 hectares (ha) logical equipment had been completed and northern and eastern provinces of Afghan- both the construction and operation phase. The project builds upon and scales up ac- (44 percent of the target 45,000 ha) of incre- data collection performance of the installed istan. It will also finance the engineering tivities supported under the completed mental irrigated area had been achieved. In stations also improved considerably in all World Bank-financed Emergency Irrigation the small dam component, the completed five river basins. Country Update/ ongoing operations 16/  results irrigation canal unites two communities “ • Farmers from two villages by Panjshir River are looking forward to doubling their production after the completion of a new irrigation canal. • The community development councils in both villages decided to collaborate on the mutually This new canal will help us a lot. beneficial irrigation project, which received funding from the National Solidarity Project (NSP). ” • The NSP, under the responsibility of the Ministry of Rural Rehabilitation and Development It is 100 percent good; and supported by the World Bank and Afghanistan Reconstruction Trust Fund, encourages local governance and development through small-scale infrastructure initiatives. it will give us all energy, just like the sun. U NABA DISTRICT, Panjshir Province – On a – Ghulam Hazrat, farmer stretch of land beside the Panjshir River, two villages work with a single purpose. To- gether, villagers dig trenches, haul rocks, pour concrete, and carefully shape a narrow irrigation canal that will soon wind about 750 meters between the two Afghan communities, bringing water to fields tended by about 1,300 families. From each village of Unaba and Deh Meina, in the Unaba District of Panjshir Province, farmers have given up valuable riverside plots so that they and their neigh- bors can all benefit from the new irrigation project cal- led Dhamm Canal. The improved water supply will mean farmers should be able to double production from their fields of wheat, corn, fruit, and other crops, says Najibul- lah Alimi, head of Deh Meina’s community development council (CDC). Deh Meina’s council of 10 men and 10 women was created in 2012 under the auspices of the Ministry of Ru- ral Rehabilitation and Development’s National Solidarity Project (NSP). Supported by the World Bank and Afgha- nistan Reconstruction Trust Fund, the NSP mobilizes Conflict over water resolved communities to run transparent elections and create Community conflict over water was a big problem pre- CDCs, much like traditional Afghan shuras (councils). It viously because farmers jealously guarded their own is estimated that about 22,490 CDCs representing some water supplies, while also sharing access to makeshift 35,200 villages have been created under the NSP. irrigation canals, says farmer Alimi. Once established, CDCs are eligible to apply for fun- Ghulam Hazrat, 80, says he paid to have a well dug ding for a range of infrastructure and service projects, on his land so he could properly water his orchards of including access to power, roads, drinking and irrigation pomegranate, apples, figs, grapes, almonds, and wal- water, improved sanitation, bridges, and schools. nuts. He also has to buy diesel for a generator to pump The two communities each received about $60,000 the well water out to his fields. funding for construction of their half of the canal. Every “The old canals were of little use. You had to wait so household also contributed about AFN400 ($7), says Mo- long for your turn, or they would get blocked with mud hammad Noor Ranjbar, an engineer and head of Unaba’s and debris. We were having big losses with our crops,” CDC. “We all recognized that our first priority should be recalls Hazrat. “Now, this new canal will help us a lot. irrigation because when our level of income goes higher, It is 100 percent good; it will give us all energy, just like then we can all have a better future.” the sun.” Country Update/ ongoing operations 18/  / The World Bank Group in Afghanistan/19 transit covered. Work is underway to cover (NEPA) in further improving their capacities the two remaining larger offices in Khost and effectively to regulate Afghanistan‘s mineral Farah by end of 2014. resource development in a transparent and ACD has also managed to implement efficient manner, and foster private sector ASYCUDA value added modules, e.g. risk development. management/selectivity, entry exit gate con- Steady progress has been made under trol, vehicle control module, SMS alerts, etc. this project: transaction support for the ten- The project has also financed construction der and negotiations of the main Hajigak of a completely new Khost Customs House, contract, including the establishment of an truck parking, administration buildings, and International Advisory Panel to ensure the warehouses at Nimroz, Jalalabad, Kandahar, transparency of the negotiations process; Kabul, and Andkhoi, and smaller infrastruc- collection of new geo data and the digital ture at Torkhum, Islamqala, and Spin Boldak. capture of existing historical geo data for The Executive dash board (management the development of a modern computer- Information and Alert System) is functional, ized geo-database in order to attract explo- with email and SMS alerts introduced. Data ration interest that is necessary to sustain exchange through secure email between discovery of new deposits and sector growth; ACD and Pakistan Customs for goods enter- the preparation and publication of 18 sub- ing and exiting through Torkhum and Spin sector development policies by commod- Boldak is functioning. ity to guide sustainable development; the A Customs to Customs Cooperation establishment of an independent external Agreement between Tajikistan and Afghan- inspection and contract compliance moni- istan was signed on March 26, 2014, and toring system; capacity building of NEPA and work is underway to finalize a similar agree- MoMP on inspectorate services functions ment with Iran. The Customs Strategic Five and regulatory monitoring; the preparation Year Plan has been prepared. Substantial of the Resettlement Policy Framework and Mohammad Umar progress has been made in preparation of the associated Environmental and Social Momand, Director of the Customs Modernization Action Plan, Post Management Framework; the preparation Second Customs ecutive information systems for customs, Planning and Reform, Clearance Audit implementation plan, Risk of a Strategic Environmental and Social Afghan Customs allowing real-time monitoring of operations; Management policy and procedure, and ex- Assessment for the sector; and implementa- Reform and Trade Department, outside the Customs building (iii) development of possible options for amination standard operation procedures. tion of the Extractive Industries Transparency Facilitation Project cross-border customs-to-customs coopera- in Kabul. The Second Work is also underway on capacity building of Initiative (EITI). Customs Reform and tion; (iv) provision of selected customs infra- the Valuation Department. The project was The excavation of nearly 75 percent of the (SCRTFP) Trade Facilitation Project is continuing with reforms to structure to enable modernized operations; extended by 12 months to complete rollout archeological red zone at Mes Aynak is under- assist the Afghan Customs and (v) technical assistance to support the of ASYCUDA, and to complete outstanding way, including the employment of some 13 Department to consolidate c IDA Grant $50.5 million development of a regulatory, administrative, infrastructure development activities. international archeologists, 9 national arche- the customs modernization process to improve SCRTFP builds on the overall success and institutional framework for customs. ologists plus 18 field support staff, around 10 of the completed Emergency Customs The project has made notable progress in Sustainable governance and the release national archeologists (fresh graduates) soon of legitimate goods in a Modernization and Trade Facilitation Project a number of areas, with automation being to be appointed, and more than 500 laborers Development of fair and efficient manner. “Before this project there and continues with the ongoing reforms. the main highlight. The Automated System residing in the surrounding communities. The project is assisting the Afghanistan for Customs Data (ASYCUDA) full declara- Natural Resources was no infrastructure and Over the past year, the MoMP and Ministry of capacity was very low,” Customs Department (ACD) to consolidate tion processing (DPS) is now fully operational Information and Cultural have significantly Project says the director. the customs modernization process, improve in 13 computerized ACD offices, resulting in increased their level of coordination (a bot- governance, and improve the release of le- more than 95 percent of declared trade made tleneck to progress in the past) and owner- c IDA Grant $52 million gitimate goods in a fair and efficient manner. electronically. Migration from ASYCUDA++ ship over the project . The project aims to achieve this through version to the newer web-based ASYCUDA The project aims to assist the Ministry (i) countrywide computerization of customs World platform has been completed in 12 of Mines and Petroleum (MoMP) and the clearance operations; (ii) installation of ex- sites, including international and national National Environmental Protection Agency Country Update/ ongoing operations 20/  / The World Bank Group in Afghanistan/21 To date, the program has mobilized over ing service delivery and security through em- 5,638 Savings Groups with a membership of powerment and development activities that some 41,800 rural poor (52 percent women) communities identify, plan, manage, and in 500 villages. The SGs have saved over $1.5 monitor on their own. There are over 33,400 million and members have accessed more Community Development Councils (CDCs), than 10,400 internal loans for productive and democratically elected through secret ballot, emergency purposes with a repayment rate mandated with governance responsibilities. of 95 percent. To generate economies of scale, They are proving to be an effective mecha- 229 Village Savings & Loan Associations have nism nationwide for ensuring equitable also been established as federations of the development, representing the rights and SGs, and are maintaining accurate and up-to- demands of over 18 million rural community date records of accounts with good govern- members. ance structure in place. On average each VSLA The NSP and its 29 Facilitating Partners has $3,300 as loan-able capital, which is fur- have worked through these CDCs to identify ther boosted with a seed grant injection. This and implement some 83,700 small-scale re- improves access to finance for group mem- construction and development activities in bers who would like to increase productivity the areas of water supply and sanitation (24 or engage in entrepreneurial activities but percent), rural roads (27 percent), irrigation This road to Jalalabad cannot access such funds from commercial (21 percent), power (10 percent), and health from Girdi-Kas village is banks or microfinance institutions. and education (8 percent) as well as gener- part of the construction ated over 50 million paid-for-labor days for AREDP also works towards strengthening and rehabilitation of thousands of roads under market linkages and value chains for rural skilled and unskilled laborers. the Afghanistan Rural enterprises by providing technical support Another recent achievement is the ‘Policy Access Project. The project for Improving Governance and Development to over 1,345 Enterprise Groups (63 percent aims to enable rural communities across female) and 256 (13 percent female) Small in Districts and Villages’, which was approved Afghanistan to benefit Medium Enterprises (SMEs) that have been by the Afghan Cabinet on December 30, from improved access to 2013. It recognizes CDCs as the sole platform selected for their potential as key drivers of basic services and facilities through all-weather roads. rural employment and income generation. A for rural development and local governance, total of six Provincial Situation Analysis (PSA) and instructs all line ministries to use CDCs has been completed and 10 PSAs are under- for implementing rural development activi- way. AREDP uses Community Development ties in their respective sector. / rural development As of September 2014, construction of 200 Afghanistan Rural Councils as an entry point into communities The NSP is active in 359 of Afghanistan’s km of secondary gravel roads, 35 km of sec- and is currently working in 20 districts of 364 districts and all 34 provinces (about 90 Afghanistan Rural ondary asphalt roads, and 590 linear meters Enterprise five provinces: Parwan, Bamyan, Nangarhar, percent of villages). It is financed together Access Project (ARAP) of secondary bridges have been completed. Construction of 518 km of tertiary roads and Development Project Balkh, and Herat. with several bilateral contributors, and more than $39.9 million of IDA funds and over c IDA Grant $125 million 520 linear meters of tertiary bridges also have (AREDP) $587.67 million from ARTF have been dis- been completed. In the meantime, routine bursed under this phase. Since inception in c ARTF Grant $107 million maintenance of 1,032 secondary roads and c IDA Grant $30 million Third Emergency 2002, over $1.48 billion have been disbursed c ARTF Grant $5.10 million ARAP aims to enable rural communities period maintenance of 132 km of second- National Solidarity as block grants directly to CDCs’ bank ac- across Afghanistan to benefit from improved ary roads were undertaken. Routine mainte- AREDP aims to enhance economic mobili- counts that are used to address their com- access to basic services and facilities through nance of 3,000 km of tertiary road and period zation and activities by organizing the ru- Project (NSP) munity development priorities. all-weather roads. The project is expected to maintenance of 237 km of tertiary road were ral poor into Savings Groups (SGs), Village c IDA Grant $40 million c For more information: increase the number of people living within also completed. The first nationwide inven- Savings & Loan Associations (VSLA) and c ARTF Grant $950 million www.nspafghanistan.org 2 kilometers (km) of all-season roads, reduce tory and condition survey of rural roads was Enterprise Groups. The project provides tech- c JSDF Grant $15 million travel time to essential services, and enable initiated. nical support to these groups so as to build rural communities to access essential servic- a financial discipline through savings and GoA’s flagship program is in its third phase es more frequently. internal lending practices, and technical sup- and aims at generating a strong sense of port to enterprises. ownership and social stability while enhanc- Country Update/ ongoing operations 22/  / The World Bank Group in Afghanistan/23 Afghanistan New Market Development / urban development Urban Water Sector Project major Afghanistan New achievements Project c IDA Grant $18.72 million Market Development (Closed on June 30, 2014) • Kabul: 382 new jobs created Project (18 percent female); 19 percent The project assisted the government in devel- c IDA Grant $22 million increase in sales; and 85 new oping the capacity of the Afghanistan Urban Water Supply and Sewerage Corporation The project aims to pilot a business develop- products introduced to national (AUWSSC) for operational management, and ment program in the four urban centers of and international markets. investment planning and implementation. Kabul, Mazar-e-Sharif, Jalalabad, and Herat, Institutional development results have which are the major hubs of economic ac- • Balkh: 128 new jobs created been significant since the creation of the tivity. It will help enterprises gain market A lady with one of her knowledge, improve product quality, boost (41 percent female); 23 percent water utility four years ago. AUWSSC has sons at her Kabul home increase in sales; 26 products assumed the country’s urban water supply working on needlework productive capacity, acquire new technolo- handicraft that help bring and sewerage responsibility and expanded in almost a third of the gies, and develop and implement business were redesigned, improved, operations. Select empirical indicators for family income. She is one plans to increase their presence in both do- and introduced to market; and operational management as measured by of thousands of micro and mestic and export markets. small business owners The project specifically aims to support six new products were created. the expansion and improved efficiency of who are benefiting from operations achieved by AUWSSC are: (i) ex- projects supported by the some 750 enterprises and 10 business as- World Bank. sociations through a cost sharing facility to • Nangarhar: 208 new jobs pansion of operations from 16 to 42 towns created (41 percent female); (162 percent increase); (ii) reduction in wa- access business development services. The ter production and distribution costs by 25 project is expected to create around 1,500 16 percent increase in sales; and percent; (iii) reduction in system water losses jobs in the short term with much higher job 23 new products launched in from 60 percent to 35 percent; (iv) reduction / social safety net growth over the longer term. local market. in the number of staff per water connection Pension Department, a comprehensive new The project is implemented by the Ministry from 8.6 to 5.9; (v) Metered customer con- Management Information System, a set of of Commerce and Industry. The General Afghanistan Safety business processes, fiscal forecasting models Director of the Private Sector Development • Herat: 192 new jobs created nections have increased by 35 percent (from 84,044 to 113,639 connections), and annual (24 percent female); 23 percent Nets and Pensions for revenues and expenditures, and a new chart of accounts of the pension system. The Department acts as the Project Director. The revenues from water sales increased by 177.4 Facility for New Market Development is man- increase in sales; and 15 new Support Project renovation of the Pension Department has aged by GIZ IS, which was selected through products introduced in local percent from AFN132.5 million ($2.3 million) to AFN367.3 million ($6.4 million). resulted in improved client services. an international competitive bidding process c IDA Grant $20 million market. A system of internal monitoring and Component 2: A multi-phased safety nets (the contract was signed in September 2012). The objectives of the project are to: (i) im- cash transfer pilot has been designed, imple- monthly reporting between the AUWSSC The Facility for New Market Development is prove the administration of the public pen- mented, and evaluated. Based on the lessons headquarters and Strategic Business Units operational in the four cities and has already sion schemes; and (ii) develop administrative learned, an improved platform for deliver- (SBUs) is in place, providing both physical and received 745 applications while 311 agree- systems for safety nets interventions, with ing targeted benefits to the poor has been financial data (e.g. number of metered con- ments for a total value of $9 million have focus on targeting and benefit payment de- designed and is being tested. It includes re- nections and revenues from connections). been signed so far. livery, to deliver cash benefits to the poorest formed operations procedures, an objective With the government’s approval of increased families in targeted pilot districts. The pro- and transparent targeting system, and a re- water tariffs by over 200 percent, AUWSSC is ject has so far achieved the following results: vised grievance redress mechanism. The pilot on a sustained path to transformation into a Component 1: Pensions: The project program over the past two years has provid- financially viable institution has financed key elements of a reformed ed support in cash transfers to over 16,000 and modernized Public Sector Pension poor and vulnerable families (around 80,000 System, which includes a revised institu- individuals) in eight selected districts of five tional and human resources structure of the provinces. 24/  Country Update/ / The World Bank Group in Afghanistan/25 INTERNATIONAL FINANCE CORPORATION / current strategy and in order to support the development of engaging with local fruit processors and fur- overview Afghanistan’s private sector, particularly ther open market opportunities, reduce vul- in the areas of infrastructure, finance and nerabilities linked to handling fresh produce, The current strategy of the International micro-finance, manufacturing, agribusiness, and continuing to seek opportunities for Finance Corporation (IFC), the World Bank and services. The investment pipeline for commercial processed food products. Group’s private sector development arm, FY15 looks promising and includes invest- is in line with the ongoing World Bank Group’s Interim Strategy Note for Afghanis- ments in financial markets, the power sector, and agribusiness. Business enabling tan. IFC is following an integrated advisory and investment strategy focused on impro- The investment program has been sup- environment ported by a strong advisory services program ving the investment climate, building capa- IFC has two primary interventions aimed at in the areas of access to finance, investment city, and supporting selective investments reforming the business regulatory environ- climate, small and medium enterprises ca- in sectors with high development impact ment. The Trade Licensing Reform Project has pacity development, horticulture/agribusi- and job creation. been supporting the government in creating ness and Public Private Partnerships (PPPs). a more transparent, efficient, and conducive At present, there are eight active mandates licensing regime. Investment portfolio with a budget of $5.7 million across all four IFC has been working with the Kabul IFC’s investment portfolio in Afghanistan business lines. Municipality to improve the construction has more than doubled since FY08 – from around $58 million to about $135 million, permit process in order to reduce paperwork, processing time, and the number of signa- as of end September 2014. Currently, IFC’s / advisory services projects tures required to obtain a permit. portfolio includes two investments in the tel- ecommunication sector (Mobile Telephone Networks – a joint project with MIGA – $65 Access to finance Public private million, and Roshan Telecom – $65 million), one investment in the hotel sector (TPS – $3 IFC is actively involved through: (i) assisting partnerships the central bank (DAB) with the setup, launch million), and two operations in financial mar- IFC has focused on power distribution in Kan- and implementation of best-practice move- kets (First Microfinance Bank – $2 million eq- dahar. IFC has been supporting DABS to de- able collateral and public credit registries, in uity, Afghanistan International Bank – trade velop, negotiate, and execute a management collaboration with the World Bank’s Financial facility). These investments have had a trans- support contract to improve the operational Sector Strengthening Program; (ii) building formational impact, particularly in the mi- and financial efficiency of the Kandahar Op- capacity of financial institutions, including Local farmers and a crofinance (in terms of access to finance and program staff member erating Centre, DABS’ regional department IFC’s two bank clients; and (iii) helping GoA to outreach) and telecommunication sectors. discuss ways to improve responsible for operations in Kandahar, establish a regulatory framework for leasing. crop output. Farmers Through the project with the First Micro- Helmand, Uruzgan, and Zabul provinces. IFC’s past interventions include a compre- across the country are finance Bank (FMFB), the first licensed private benefiting from projects Following a comprehensive technical and hensive operational diagnostic of Kabul Bank sector microfinance bank in Afghanistan, IFC nine local training providers to strengthen supported by the financial evaluation, Power Generation So- after its crisis and a review of housing sector International Financial helped to reach over 64,000 borrowers – 16 their capacity and enhance the provision of lutions/Afghanistan Holding Group Con- lending. Corporation (IFC). IFC, percent of whom were women. Similarly, management training services. As of June among other activities, sortium won the bid for the management IFC has had significant impact in the tel- 2014, phase two of the program has deliv- has been providing support contract. The contract is the first- ecommunication sector by improving mo- Enterprise ered training to approximately 3,000 people support to small and medium enterprises in ever performance based PPP agreement in bile phone access and services to the poor through the investment in Mobile Telephone development (54 percent women) and reached over 300 MSMEs. the agribusiness sector, targeting farmers and Afghanistan and was signed in August 2014. Furthermore, IFC Advisory Services has Networks (MTN) and more recently in Roshan The Business Edge initiative has launched IFC has been providing support to SMEs traders and helping them been collaborating closely with the World improve productivity. Telecom. Going forward, IFC is looking to ex- a second phase with the goal of facilitating in the agribusiness sector, targeting farmers Bank in the Doing Business Indicator Reform pand its investment program in Afghanistan business skills training for over 5,200 individ- and traders and helping them improve pro- project and the Incentive Program in sup- in the areas of infrastructure, finance, manu- uals (including 44 percent women), reaching ductivity. IFC also supported the expansion porting key reforms affecting the private facturing, and services. more than 520 micro, small, and medium en- of market opportunities both nationally and sector. IFC will continue to seek new investment terprises (MSMEs) over the next three years. internationally. Going forward, IFC will fo- opportunities and engage with local players As part of this project, IFC has partnered with cus on improving farmers’ income, through 26/  Country Update/ / The World Bank Group in Afghanistan/27 The Afghanistan AFGHANISTAN RECONSTRUCTION TRUST FUND Reconstruction / what is the artf? cient funding to finance the Recurrent Cost Trust Fund commitments have exceeded recurrent cost Window and that it retains some flexibility commitments. Disbursement rate on ARTF The Afghanistan Reconstruction Trust Fund in the approval of projects in support of the investment as of October 17, 2014, is 55 (ARTF) is a partnership between the inter- NPPs. The Afghanistan Reconstruction percent. Decentralized and national rural national community and GoA for the im- Trust Fund (ARTF) was established development programs, such as the NSP, ru- proved effectiveness of the reconstruction The Recurrent Cost (RC) Window in April 2002 as a temporary ral roads, and education, have been strongly effort. Since 2002, 33 donors have contri- supported by ARTF. Grant $3.17 billion means to finance the buted over $7.3 billion, making ARTF the As of October 17, 2014, there are 19 active largest contributor to the Afghan budget To date, ARTF has disbursed $3.10 billion government’s wage bill. ARTF projects under ARTF with a total committed for both operating costs and development through the government’s operating budget. has now developed into the main value of $2.31 billion, of which $1.39 billion programs. ARTF’s support for National Prio- Domestic revenues continue to be insuffi- multi-donor funding mechanism have been disbursed and the net undisbursed rity Programs, operating costs of govern- cient to cover the costs of government. The amount is $920 million. in the country, financing both ment operations, and the policy reform ARTF Recurrent Cost Window has therefore c Full details of investment activities are agenda is contributing to the achievement ensured the basic functioning of govern- the essential running costs of provided in the ARTF Quarterly Reports: of the Afghanistan National Development ment including the delivery of services such government as well as key Afghan www.worldbank.org/artf. Strategy goals. as healthcare and education. Given that National Development Strategy around 60 percent of the non-uniformed programs across the country. Management Afghan civil service is accounted for by teach- The objectives of ARTF are to: The World Bank is administrator of the fund. ers, the Ministry of Education has in general / how the artf works The Management Committee consists of the received about 40 percent of total ARTF re- • Position the national budget World Bank, Islamic Development Bank, Asian sources. Ministries of Public Health, Foreign as the key vehicle to align the Donors contribute funds into a single ac- Development Bank, UNDP, and Ministry of Affairs, Labor and Social Affairs, and Higher count, held by the World Bank in the USA. The reconstruction program with Finance. The Management Committee meets Education have also been major recipients. ARTF Management Committee makes deci- regularly in Kabul to review ARTF finances It should also be highlighted that the RC national development sions on proposed allocations at its monthly and approve funding proposals. Once a quar- Window resources are national in scope, objectives. meetings, and those decisions are translated ter, donors meet to discuss broader strategy ensuring the payment of salaries of around • Promote transparency and into funds through Grant Agreements signed with the government and ARTF management 62 percent non-uniformed civil servants in between the World Bank and the Government accountability of reconstruction in the steering committee. all 34 provinces of the country. Steady year- of Afghanistan. on-year increases in operating costs across assistance. ARTF allocations are made through two Donor contributions government mean the RC Window accounts • Reduce the burden on limited ‘windows’: the Recurrent Cost Window and Donor contributions have increased year af- for a declining share of the overall budget. government capacity while the Investment Window. The Recurrent Cost ter year, with new donors joining and older Nevertheless, the RC Window still finances Window reimburses the government for a promoting capacity building donors increasing their levels of contribu- around half of the non-security costs of certain portion of eligible and non-security tion. Over the last few years the ‘preferenced’ government. over time. related operating expenditure every year. The portion of donor contributions has been • Enhance donor coordination for Investment Window provides grant financing the main factor driving growth. The agreed The Investment Window financing and policy dialogue. for national development programs in the de- ARTF rule is that donors may not ‘preference’ The Investment Window has in the last velopment budget. more than half of their annual contributions. years increased significantly in volume and This rule is to ensure that ARTF has suffi- scope. Since SY1389 (year 2010) investment Country Update/ artf 28/  / The World Bank Group in Afghanistan/29 A farmer in his wheat increased wheat production is already ongo- Council. Also, the initial draft of the pesti- field in Panjshir Province ing. With AAIP’s financial support and techni- cides law is undergoing the requisite process who will stand to gain from the Afghanistan cal assistance – through AAIP staff working in the Ministry of Justice. The AAIP Legal Unit Agricultural Inputs Project, at six ARIA regional research stations – a to- has drafted a fertilizer law, which is being which aims to increase tal of 40.7 ton unclean breeder seed was pro- reviewed by a technical committee assigned adoption of improved crop production technologies. duced in 2014, thus exceeding the target of by the Minister of MAIL and will then be sub- Comprehensive action 37.6 metric ton (MT). Similarly a total of 41.7 jected to the MAIL Policy Analysis and Legal plans to strengthen MT foundation seed and 4.3 MT of registered Advisor Department for further process. research and seed production activities are seed were produced with AAIP support to ISE. about to be implemented. The first batch of candidates for gradu- Field support for increased ate studies abroad comprising a total of 36 wheat production is already ongoing. MAIL staff members (34 MSc and 2 PhD) Afghanistan Justice from ARIA, ISE, and Plant Protection and Service Delivery Quarantine Directorate-MAIL (PPQD) com- pleted the mandatory English language Project training and were sent to different interna- Grant $85.5 million tional universities in India. In-country train- ing on wheat seed improvement for a total The objective of the Justice Service Delivery of 47 staff members from ARIA, ISE, Afghan Project for Afghanistan is to increase ac- National Seed Organization and Directorate cess to and use of legal services. The project of Agriculture, Irrigation and Livestock was seeks to implement the government’s NPPs; conducted in August 2014. In addition, candi- mitigate the impact of the transition; put the dates from the aforementioned agricultural system on a sustainable path for long-term directorates and institutions were identified, results; and improve service delivery. and 39 have been selected for short-term The project will finance the costs associ- overseas trainings and will shortly be sent to ated with: (a) building capacity of frontline Indian agricultural training institutions. legal service providers to deliver key legal Under Component B, the design of labo- services; (b) increasing scope and quality of ratories for the PPQD is ongoing. Design legal aid; (c) improving access of the people and supervision of construction has been to legal information and civil legal education; entrusted to the Centre for Agriculture and (d) improving management and provision of / ongoing projects is invaluable to support continued increase livery systems for seeds and agro-chemicals. Bio-Sciences International, a UK-based non- legal services by central justice institutions; of agriculture productivity. The sustainability of these interventions will profit intergovernmental organization with and (e) building project management capac- Afghanistan The project builds the requisite institu- be supported by capacity building programs ample experience in these matters, to ensure ity. The project has been effective since May tional capacity in the ministry for carrying involving civil servants, farmers, and traders. quality in design and construction. 31, 2012 and the implementing agencies are Agricultural Inputs out its public mandate in the agricultural During its second semester of implemen- A detailed assessment of entry points the Supreme Court, Ministry of Justice, and Project (AAIP) inputs sector. Firstly, the project will improve tation, AAIP completed the expansion of its across international borders, followed by field Attorney General’s Office (AGO). the technical and economic efficiency of the technical teams at central and regional lev- visits, was conducted to assess the current There has been progress in several of the Grant $74.8 million value chain of certified wheat seed. Secondly, els, thus finalizing necessary arrangements situation of existing quarantine stations, and components and sub-components: the im- In an effort to increase adoption of im- building on the legal and regulatory frame- to provide increased assistance for improved to identify land for their expansion and con- plementation infrastructure is in place; an- proved crop production technologies, the work that the project helped build during the quality and delivery of production inputs to struction of new ones. Meanwhile, a firm has nual work plans have been prepared; capital AAIP was approved on June 17, 2013, allo- preparation phase, the project will develop the agricultural sector. been contracted and has started work on re- investment plans (which will govern all capi- cating $74.75 million. The agriculture sector the necessary accredited facilities for plant Under Component A, comprehensive ac- modeling the quarantine post parcel office in tal investment projects and maintenance is central to Afghanistan’s economy employ- quarantine networks and quality control of tion plans to strengthen ongoing research the Ministry of Commerce and Industry. and operations expenditures) are under im- ing 60 percent of the nation’s workforce. As agro-chemicals. Thirdly, guided by the re- and seed production activities were devel- Further, the Plant Protection and Qua- plementation; the development of the legal such, strengthening institutional capacity sults of field surveys carried out during the oped and are now slated for implementa- rantine Law was approved by the Legislation aid road map (overall policy for the state le- of the Ministry of Agriculture, Irrigation and preparation phase, the project will design tion at the Agriculture Research Institute Committee of Ministers’ Council (LCMC) after gal aid) and legal aid regulatory framework, Livestock (MAIL), and increasing investments and pilot test a demand-led action plan to of Afghanistan (ARIA) and Improved Seeds rigorous review, and will be sent to parlia- training needs assessments for courts and for safety and reliability of agricultural inputs improve and develop market based input de- Enterprise (ISE). Meanwhile, field support for ment after further review by the Ministers’ public defenders’ offices are about to be Country Update/ artf 30/  results farmer field schools keep livestock healthy and improve income • Livestock farmers in Nangarhar Province are learning to feed their animals properly and to give them prompt medical care as a result of participating in Farmer Field Schools. • The schools are a key activity of the National Horticulture and Livestock Project, a Ministry of Agriculture, Irrigation and Livestock initiative supported by the Afghanistan Reconstruction Trust Fund. • The project aims to assist farmers adopt better livestock practices to improve animal production and health. M ERAK BELA VILLAGE, Nangarhar Province – Livestock farmer Jan Agha says he owes his water buffalo an apology. Laughing loudly, Agha explains that he is only half joking, because until recently he hadn’t realized that his animals needed better medical care and feeding. “It is both too funny and too sad to now think of the things that we did,” says Agha, 41. “But we didn’t know what was wrong then. Now we are learning better ways to feed, protect, and clean our animals, and they are so happy. We are getting richer, too.” After years of livestock tending, Agha says the trans- formation happened when he started attending a Far- mer Field School (FFS) in his village of Merak Bela in Beh- sood District in Nangarhar Province. The classes, offered “ twice a month in the village, are a key component of the National Horticulture and Livestock Project (NHLP), a Ministry of Agriculture, Irrigation and Livestock initiative learning better ways to feed, with support from the Afghanistan Reconstruction Trust Now we are Fund. The project’s objective is to assist producers in adopting improved livestock practices to increase their protect and keep them clean, productivity. a digestive disorder that can occur when animals eat too ” Agha says the project is not only helping his animals, much fresh grass. Now, Toryalay says, he knows how to but also putting more money in his pocket. His income properly handle these issues or to seek prompt veteri- and our animals are so happy. has tripled now because of the project. “Before, our cows nary care. In the past, he recalls, home remedies like fee- We are getting richer, too. were producing maybe 3.5 liters of milk per day and now ding sick animals cooking oil or ghee just weakened or it can be 10.5 liters.” killed them. Instead, healthy animals mean a healthy profit, says –Jan Agha, livestock farmer, Merak Bela Village Schools result in immediate benefits Toryalay. “Alive a cow can be worth AFN200,000 (about $3,500), but if it is sick and has to be butchered it may In Agha’s village, on the banks of the Kabul River across then be worth only AFN50,000 (about $880).” from Jalalabad, the NHLP project started in January Local veterinarian Dr. Amin Shafiq, who helps run the 2013. Some 30 groups of farmers have formed (10 of FFS classes, says there is already demand from other men and 20 of women who primarily manage poultry) villages for the project. “People are hearing about the for FFS classes in Nangarhar Province. positive results and they can see the immediate bene- At each class, a different topic is discussed. Livestock fits from what others are learning, so it’s been very good farmer Toryalay says he learned about hygiene for milk both for the animals and their keepers. ” collection, proper stabling for buffalo, and treatments for common diseases like mastitis, influenza, and bloat, Country Update/ artf 32/  / The World Bank Group in Afghanistan/33 contracted; civil service reform in the AGO has 10 percent, and the irrigated area increased begin construction alongside or prior to next been advancing according to plan (a number by 10 percent. At present, surveys of 148 round of large extractive investments. of critical positions have been advertised and schemes have been reported to be com- 2) Travel times for both extractive industries new staff have been hired through a competi- pleted. Out of these, designs of 128 schemes and general public to remain at least con- tive process); training programs for prosecu- have been prepared and contracts for con- stant or at best, improved along a critical re- tors focusing on white collar and corruption struction of 86 schemes have been awarded. source corridor highway. related crimes is on its way; and the construc- About 60 schemes covering an area of some 3) Skills provision (public and private) closely tion of the Information and Administrative 12,935 hectares have been completed. targeted to extractive industry investor re- Center of the Supreme Court and two other As of August 2014, a total of 146 staff quirements, enabling 70-80 percent local provincial offices have been completed. members of MAIL and provincial Department employment in direct jobs in the sector, es- Eight legal aid offices have been strength- of Agriculture, Irrigation and Livestock (DAIL) timated to be around 5,000-8,000 in the ini- ened and two legal aid offices have been have been trained overseas. A total of 225 tial years, depending on timing and scale of opened. More than 60 percent of the civil staff members have been trained in topics investments. servants in the Attorney General’s Office have ranging from on-farm water management, 4) Benefits increased in wider economy been moved to the Pay and Grading System. modern irrigation practices, system of rice through national and local firms supplying Construction of two appellate courts and intensification quality control and quality part of 15 moderate capability sub-catego- two AGO offices and refurbishment of the assurance construction, and social mobiliza- ries of goods and services for Amu Darya and AGO headquarters (HQ) have been complet- tion. Moreover, Irrigation Department staff Aynak, plus 50 percent (by value) of low capa- ed. Significant progress has been achieved in at the provincial level is continuously receiv- bility goods and services. the implementation of the pilot IT networks ing on-the-job training from project staff. 5) Effective land acquisition enabled along in the AGO HQ and the first and appellate Five office buildings for regional MAIL offices proposed road, rail, and transmission routes courts in Kabul. Five legal libraries have been have been completed. through land title clearance. opened by the Supreme Court and AGO. 6) Ongoing community benefit sharing The project has ambitious objectives for around major extractive investments through structural reforms and development of an Afghanistan Power implemented community development improved legal services regulatory frame- agreements. work. Right-sizing of the sector according Sector Development More than 370 kilometers The program is slated to take place from to the demand for legal services will require Project of distribution lines have been constructed or December 2013 to December 2018. strong policy dialogues between the Bank supporting the energy efficiency activities grant will focus on four components: (i) in- and judicial institutions. Grant $60 million rehabilitated under the Afghanistan Power System of MEW through the setting up of an Energy frastructure corridor investment preparation The project supports GoA in increasing ac- Development Project. The project supports Efficiency Unit. A consultant was selected which includes private investment support, Capacity Building for cess to grid power, and the quantity of power Afghanistan On-Farm available to consumers in the target urban the Government of Afghanistan in increasing to carry out a national awareness program for energy efficiency, which was completed road rehabilitation, and key road mainte- nance; (ii) livelihood component consisting Results Facility Project Water Management centers of Pul-e-Khumri, Charikar, Gulbahar, access to grid power, and the quantity of power in July 2014. Another contractor was also of a matchmaking facility to increase local for Afghanistan and Jabul-Seraj. It consists of the follow- available to consumers in procured for three energy efficiency demon- content as well as skills matchmaking; (iii) Grant $100 million Project ing three components: distribution system four target urban centers. stration programs, all of which have been environment and social impacts component rehabilitation; rehabilitation of transmis- completed as well. including land identification and support to The project will assist the government in im- Grant $25 million sion switchyard associated with Naghlu and land project preparation, as well as facilita- proving the capacity and performance of core This pilot project is designed to support on- Mahipur Hydropower Stations; and institu- tion of community development agreement line ministries in carrying out their mandates tional capacity building and project manage- farm water management investments in five regions (Central, Eastern, Southwest, ment support to the Ministry of Energy and Afghanistan Resource implementation; (iv) capacity/governance to strengthen public private partnership capa- and delivering services for national priority programs. This will be achieved through the Northeast, Northern) covering a total of Water (MEW). Corridor Project bility, and support Civil Society Organizations implementation of specific capacity and in- 10,000 hectares. The project improves agri- To date, 372 kilometers of distribution lines (CSOs) for accountability, project implemen- stitution building programs, which include Grant $70 million cultural productivity in project areas by en- have been constructed or rehabilitated under tation agencies, and communications. systematic monitoring of and reporting on hancing the efficiency of water use. the project. A total of 17,224 kilovolt-amps The grant will prepare a platform of ‘hard’ and The grant aims to achieve the following: results. Land productivity of wheat and other crops (KVA) was installed in Charikar, Gulbahar ‘soft’ infrastructure enabling Afghanistan to 1) Five large infrastructure investments – The grant will help finance the costs as- has increased by 15 percent. Water produc- and Jabul-es-Seraj, while 14,982 KVA were derive broader economic benefits from the public, or public-private – optimized to de- sociated with (i) technical assistance for tivity of wheat and other corps increased installed in Pule Khumri. The project is development of its extractive industries. The liver public goods under uncertainty, ready to preparation and implementation of capacity Country Update/ artf 34/  / The World Bank Group in Afghanistan/35 A 10-year old girl with her sister squat by a recently constructed road in a suburb of west Kabul. The streets in this area have been improved along with easier access for residents and visitors. Under the Kabul Municipal building programs; (ii) recruitment of some support for the CASA-1000 transmission line. Development Program, 2,400 managerial, common function, and The project consists of four components. service delivery and the professional staff for key positions in select- The first component, community grants city environment are set to improve further. ed line ministries; (iii) a management intern- for sub-projects will provide grants directly The project is expected ship program; (iv) training of civil servants; to communities to fund economic infrastruc- to deliver welfare and and (v) project management, monitoring, ture sub-projects. Preference will be given to human development power sector sub-projects. The second com- benefits to over 770,000 and evaluation. people through different The Ministry of Finance and the Inde- ponent, community mobilization aims to municipal services. pendent Administrative Reform and Civil engage communities to increase the shared Service Commission are jointly implement- prosperity associated with the CASA-1000 ing this project. The government has ap- transmission line, which will pass through proved the core operational policies, and the villages, by facilitating community participa- Ministries of Agriculture and Communication tion in sub-project planning, implementa- were approved as the first top tier ministry, tion, and operations and maintenance. enabling it to recruit a substantial num- The third component is project imple- ber of skilled civil servants to implement its mentation support. It comprises a sub- Capacity Building for Results (CBR) reform component, third party monitoring (TPM). program. The Ministry of Mines was recently The fourth component, communications approved and the Ministry of Health is in the and outreach will finance a strong commu- final stages of program development with nications campaign and information-sharing other ministries in earlier stages of devel- activities directed to relevant stakeholders opment (e.g., Ministries of Education, Rural within the provinces with a special emphasis Development, and Commerce). on outreach to communities in the project Recruitment of senior level civil servants areas. funded through CBR is progressing; a total Work under CASA-CSP will begin once the of 99 active senior management group po- CASA-1000 project is operational. Once im- sitions is currently funded with 45 more in plementation begins, the CSP is expected to various stages of recruitment. CBR is also benefit communities that live along a two- encouraging salary harmonization for donor- kilometer ‘Corridor of Influence’ (COI) each are to: (i) increase access to basic munici- (neighborhoods) have been upgraded, ben- technical assistance to Kabul Municipality in The Design Review and Site Supervision funded consultants led by the World Bank, side of the CASA-1000 transmission line. It pal services in selected residential areas of efiting over 184,000 people, and another 15 specific areas. Investments in key road infra- Consultant is on-board. The National which is applying the CBR salary scale to its is expected that there will be approximately Kabul city; (ii) redesign Kabul Municipality’s are planned for the coming year, which will structure will improve connectivity and make Competitive Bidding (NCB) civil works con- project consultants. Mid-Term Review of the 700 communities spread over 23 districts in Financial Management System to support benefit 99,231 people. Four contracts for Kabul more inclusive, while technical and tracts have been awarded and work is in pro- six provinces, with a total of over 152,000 project was concluded in February 2014, and better service delivery; and (iii) enable early re- trunk roads were awarded in 2013, of which knowledge support will gradually transform gress. The design reviews for all International families along the corridor of influence. restructuring will take place shortly to accel- sponse in the event of an eligible emergency. three have been completed. Kabul Municipality into a modern planning Competitive Bidding (ICB) contracts have Given the terrain along the COI, as well as the erate progress. The project is expected to deliver welfare and implementing agency by adopting best been completed and ready for procurement. unique nature of community mobilization in and human development benefits to approx- international practice. Kabul Municipality The Wazir Abad Canal survey and design has high-risk areas, there will be some flexibility to work with more communities outside of imately 777,380 people through services pro- Kabul Urban will be responsible for implementation of the been completed and is under the Project Central Asia South the COI. vided in 1,773 hectares of government-owned land. Equipment for the roads and sanitation Transport Efficiency project, including procurement and financial management. Management Unit review. To date, the pro- ject has disbursed $5 million. Asia-1000 departments of Kabul Municipality will com- Improvement Project Progress towards the achievement of the Community Support Kabul Municipal bat pollution and improve service delivery as well as the city environment. There will be (KUTEI) project development objectives will be meas- ured through the following indicators: (a) Program (CASA-CSP) Development Program project support to develop a plan for improv- Grant $90.5 million traffic capacity improvements will be meas- ing the municipality’s financial management ured by average vehicle speed during off peak Grant $40 million (KMDP) and planning capacity to deliver improved The project targets improvement of trans- hours; (b) people (within a 500-meter range The project aims to provide access to elec- services to its people. The plan will enhance port services through a package of interrelat- under the project) in urban areas provided Grant $110 million tricity or other social and economic infra- KM’s legitimacy when implemented. ed interventions to build Kabul Municipality’s with access to all-season roads; and (c) per- structure services to communities in the Kabul Municipality (KM) is responsible for im- Since approval of KMDP on 11 April, 2014, capacity. The project will focus on improve- centage of Kabul city’s trunk road network in project area in order to strengthen community plementing the project. The project objectives $6 million has been disbursed. Twenty Guzars ment of road infrastructure and provision of at least ‘fair’ condition. Country Update/ artf 36/  / The World Bank Group in Afghanistan/37 of beneficiaries in defining the type of ser- and promote modernization of horticulture vices required and in the delivery itself. The sector, through establishment of 26 ha of project will also promote improved ratio of demonstration plots of high and medium overall costs reaching beneficiaries as direct density orchards. investments. The aim is thus to promote sus- Regarding improved livestock production, tainability, effectiveness, and efficiency. NHLP is supporting MAIL compliance with its By the end of its six-year project cycle, Sanitary Mandate (SM). It is doing so by sup- the NHLP aims to achieve the following key porting improved Extension and Veterinary results: 97,500 target farmers exposed to Services delivery through private Veterinary and understanding a horticulture produc- Field Units (VFUs), and through establish- tion practice and its benefits; 6,000 hectares ment of an Animal Health Sanitary Mandate (ha) of orchards rehabilitated directly and Contracting Scheme (AHSCS). NHLP conduct- indirectly; 8,000 hectares of new orchards ed SM training for 168 VFUs and 74 Provincial (including vineyards) established with at Veterinary Officers. On the production side, least 70 percent survival rate; 800 hectares the delivery so far of extension messages of grape trellising; 500 hectares of dry land has been carried out along with distribution horticulture (new pistachio groves planted); of improved technology packages to 31,540 20,000 kitchen gardening schemes estab- beneficiaries – against an overall target of lished; 50 percent of target farmers adopting 133,000 – in 138 districts of 19 provinces. regular livestock inoculation (or veterinary The establishment of AHSCS initially fo- field units stocking inputs recommended in cused on a brucellosis control program in extension messages); and 75 percent reduc- 348 districts of 34 provinces. Through this tion in animal brucellosis prevalence in tar- program, 430,000 young cattle (20 percent get areas. of the whole population) and 2.2 million As of September 2014, the project has fi- young sheep and goats (20 percent of sheep nanced the establishment of 4,414 hectares and goat population) have already been vac- of new orchards (against a target of 800 hec- cinated. Supervision and monitoring of the tares), of which 30 percent are in new prov- vaccination program was conducted jointly A farmer (right) consults a inces. Similar substantial achievement has by MAIL and NHLP. National Horticulture and been recorded for rehabilitation of orchards Livestock Project (NHLP) (29,192 hectares actual against a target of leader from the Afghan Department of Agriculture about his property in a 6,000 hectares). In addition, demand from target beneficiaries for kitchen gardening Non-formal Approach National Horticulture livery of extension and investment support village in Jalalabad, where he is growing lemon trees. support has proved very high, and the en- to Training and Livestock Project through strengthened systems. The project has three components: (i) horticultural pro- The NHLP has helped the farmer start his crop by tire annual program was amply exceeded (34,695 schemes against a target of 20,000 Education and Jobs (NHLP) duction; (ii) animal production and health; providing the trees and fertilizer. The project aims schemes). in Afghanistan Grant $100 million and (iii) implementation management and technical assistance support. These activities to promote adoption of improved production Further, NHLP continues to introduce inno- vative lines of investment support. It has suc- Project (NATEJA) The National Horticulture and Livestock will be implemented in 100 focus districts practices by target farmers, cessfully introduced production techniques Grant $15 million with gradual rollout of Project, effective since January 2013, has a spread over time as conditions warrant in up farmer-centric agricultural to, inter alia, extend the production period of The project aims to increase the potential total funding of $100 million including initial to 22 target provinces. services systems and vegetables through establishment of some investment support. for employment and higher earnings of allocation of $50 million. The project con- The project aims to promote adoption 900 production schemes based on the use of targeted young Afghan women and men in tributes to the overarching goal of increased of improved production practices by target micro greenhouses; create a culture of high rural and semi-urban areas through non- productivity and overall production of horti- farmers, with gradual rollout of farmer-cen- productivity dry land cultivation, by having formal skills training. The project consists of cultural products, and improved animal pro- tric agricultural services systems and invest- already supported establishment of 566 ha three components. duction and health. The technical strategy for ment support. Service delivery centered on – against an overall target of 500 ha – of pis- Component 1: Improving Access to Non- achieving this objective is based on the de- farmers will promote increased participation tachio orchards with high yielding varieties; formal TVET Training. The premise of this Country Update/ artf 38/  component is that a significant share of Second Public expertise, and practices in using the services young women and men aged 18 to 35 in and results of other auditors and experts in Afghanistan is unskilled and illiterate. They Financial Management line with International Auditing Standards, enter the labor force totally unprepared to Reform Project in particular for project audits. Support also compete in the labor market, and are un- given for consultant services to train staff able to find jobs and earn a decent living. As Grant $75 million and lead high quality independent review of a result, many of them are easily susceptible The project objectives are to strengthen all operations under the budget of nine line to engaging in anti-social activities, which public financial management through ministries over the project period. Support may breed insecurity and instability in the effective procurement, treasury and audit also given to finance training of members of country. structures, and systems in line with sound the Public Accounts Committee. Component 2: Improving the Quality of financial management standards of moni- 4. Reform Management: to provide sup- Non-formal Training and the Labor Market. toring, reporting, and control. port to monitor technical assistance and re- Under this component, incentives will be Project components include: port on benchmarks of the Public Financial given to non-formal training providers if the 1. Procurement Reform Services of a Management Roadmap. Support also pro- employment rate of their graduates meets Procurement Facilitation Consultant: to vided for human management reform in the a stipulated benchmark. The rationale for provide support for centralized oversight al- ministry. this intervention is that incentives directly though with some deployment of staff to the Some progress has been made to date. The linked to labor market outcomes are likely to line ministries. Under the Procurement Policy legal framework underpinning public finan- encourage service providers to actively seek Unit in the Ministry of Finance, advisors are cial management has been established. A employment for their graduates. completing the development and imple- comprehensive budget has been prepared It is also based on the premise that labor mentation of a procurement management in an orderly and transparent manner by the market outcomes (e.g., earnings and em- system and continue to roll out training in cabinet executive and approved by parlia- ployment) cannot improve unless the qual- procurement, both centrally and in provinces ment. A government-wide integrated finan- ity of non-formal training itself improves. for all line ministries. cial management information system is in Therefore, non-formal training providers are 2. Financial Management Reform place. incentivized to ameliorate the quality of their Operations: to support policy assistance On the basis of these advances, the follow- training so that they can better respond to to the Treasury Department to assure high ing outcomes have been generated: (a) all the demand from employers seeking quali- quality performance; the focus will be to transactions under the budget are now ef- fied semi-skilled labor who are productive mainstream these functions in the civil ser- fected online through AFMIS with the cor- enough to help them raise their profitability. vice staff. The consolidation of the roll-out responding benefits of automated controls; Component 3: Strengthen the Institutional of the Afghanistan Financial Management (b) since 2008, monthly financial statements Capacity of Ministry of Labor, Social Affairs, and Information System (AFMIS) to the covering central government have been Martyred and Disabled in key areas such as (i) provinces is also financed as well as sup- published and operating units can produce procurement, (ii) financial management, and port for the development of administrative on their own customized statements from (iii) labor market information systems and systems for the line ministries. Capacity de- AFMIS at any time updated budget execu- monitoring. velopment in financial management func- tion reports; (c) every year since 2006, the Progress to date include: recruitment of tions, throughout the public sector, is also audited annual appropriation statements international consultants for NATEJA has financed. Additionally, support is also given of Government expenditures (Qatia) have progressed by about 70 percent; recruitment for establishing the legal framework for and been submitted to parliament within six of local staff for NATEJA has progressed by contributing to the training of professional months of the end of the fiscal year in about 80 percent; the first standing com- accountants in Afghanistan. accordance with public financial manage- mittee meeting for the project has been 3. Audit Reform and Performance: Internal ment law; and (d) 450,000 government held; and the first draft of a plan for NATEJA/ Audit – to finance the services of consult- employees have been registered under the National Skills Development Program inte- ants to lead key internal audits and to pro- verified payroll program, of whom 290,000 gration with the General Directorate for Skills vide on-the-job training. Basic training to all are receiving salary through direct transfer Development has been developed. internal audit staff is supported; more ad- to their bank accounts. vanced training is also provided to staff who have completed the basic training. External Audit – to provide assistance to the Supreme Note: All dollar figures are in US dollar equivalents. IDA, the International Development Association, is the Audit Office (SAO) to develop its knowledge, World Bank’s concessionary lending arm. The World Bank Group in Afghanistan www.worldbank.org.af Abdul Raouf Zia phone +93 700 280 800 infoafghanistan@worldbank.org photos © Graham Crouch/World Bank House 19, Street 15, Wazir Akbar Khan, Kabul, afghanistan ©World Bank, November 2014