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Inter Press Service: The Enron-isation of Afghanistan?

by William FisherInterPress News Service
May 3rd, 2006

"Contractors in Afghanistan are making big money for bad work" -- that is the conclusion reached in a new report from CorpWatch written by an Afghan-American journalist who returned to her native country to examine the progress of reconstruction.

"The [George W.] Bush administration touts the reconstruction effort in Afghanistan as a success story," the report says, but claims that reconstruction has been "bungled" by "many of the same politically connected corporations which are doing similar work in Iraq", receiving "massive open-ended contracts" without competitive bidding or with limited competition.

"These companies are pocketing millions, and leaving behind a people increasingly frustrated and angry with the results," the report says. Foreign contractors "make as much as 1,000 dollars a day, while the Afghans they employ make 5 dollars per day," the report charges.

Examples cited in the report by author Fariba Nawa:

"A highway that begins crumbling before it is finished. A school with a collapsed roof. A clinic with faulty plumbing. A farmers' cooperative that farmers can't use. Afghan police and military that, after training, are incapable of providing the most basic security."

Nawa says such examples abound in the country. She writes, "Near Kabul City in the village of Qalai Qazi, Afghanistan, stands a new, bright-yellow health clinic built by American contractor, The Louis Berger Group. The clinic was meant to function as a sterling example of American engineering, and to serve as a model for 81 clinics Berger was hired to build -- in addition to roads, dams, schools and other infrastructure -- in exchange for the 665 million dollars in American aid money the company has so far received in federal contracts."

"The problem is, this 'model' clinic was falling apart: The ceiling had rotted away in patches; the plumbing, when it worked, leaked and shuddered; the chimney, made of flimsy metal, threatened to set the roof on fire; the sinks had no running water; and the place smelled of sewage," the report says.

The U.S.-led reconstruction effort has directed substantial resources toward eradicating illicit poppy growing. It awarded a contract worth 120 million dollars over four years to train opium growers in the cultivation of alternative crops.

One part of the programme "instructed farmers in Parwan to grow more vegetables, and promised to find buyers for them both within the country and beyond. The farmers, who normally planted beans and lentils, grew green vegetables as encouraged. But instead of profiting, they lost money. Vegetables flooded the market and drove the price down," the report says.

In another part of the same programme, the report says, it was determined that Afghan farmers, who make up about 80 percent of the working population, needed canals and irrigation systems and the means to get their product to domestic markets more efficiently, to minimise crop loss, and to reestablish their access to the international market.

The contractor's solution was to build irrigation canals. But the report points out that poppies need very little water or fertiliser to thrive. The result, the report says, was that opium poppy growers used the water in the canals to grow even more poppies.

The report says the U.S. hired a number of public relations companies to put a positive face on the reconstruction effort. One of them is the Washington-based Rendon Group, which the report says has "close ties to the Bush administration". The Pentagon has awarded Rendon more than 56 million dollars in contracts since Sep. 11, 2001, "as part of a coordinated effort to disseminate positive press about America and its military in the developing world".

The contracts call for "tracking foreign reporters" and "pushing (and sometimes paying) news outlets worldwide to run articles and segments favourable to United States interests."

The report says Rendon was also granted a contract in 2004 to train staff at President Hamid Karzai's office in the art of public relations, and "later received another hefty grant of 3.9 million dollars from the Pentagon to develop a counter-narcotics campaign with the Afghan interior ministry -- despite objections from Karzai and the State Department."

The report charges that the contracting system used by international donors is broken. It says, "USAID gives contracts to American companies (and the World Bank and IMF give contracts to companies from their donor countries) who take huge chunks off the top and hire layers and layers of subcontractors who take their cuts, leaving only enough for sub-par construction."

"Quality assurance is minimal; contractors know well they can swoop in, put a new coat of paint on a rickety building, and submit their bill, with rarely a question asked. The result is collapsing hospitals, clinics, and schools, rutted and dangerous new highways, a 'modernised' agricultural system that has actually left some farmers worse off than before, and emboldened militias and warlords who are more able to unleash violence on the people of Afghanistan."

Afghans, the report says, "are losing their faith in the development experts whose job is to reconstruct and rebuild their country...What the people see is a handful of foreign companies setting priorities for reconstruction that make the companies wealthy, yet are sometimes absurdly contrary to what is necessary."

Meanwhile, the report says, "the security situation in Afghanistan continues to deteriorate, directly threatening ongoing reconstruction. Some of the fighting is simply the result of deep frustration and distrust among Afghans who no longer believe the international community is looking out for their best interests."

The "deliberate use of warlords and militias in reconstruction efforts has only lent them more credibility and power, further undermining the elected government and fueling a Taliban-led insurgency that continues to gain power."

The basic infrastructure in the country, the report concludes, "is in shambles; the drug trade is booming. This result should be seen as a major setback to the 'War on Terror.' To Afghans, who after decades of war, believed they would finally catch a break, it's a heartbreak."

Prof. Beau Grosscup of California State University at Chico agrees. He told IPS, "This report confirms that Afghanistan has been 'Enron-ised' by the Bush administration."

"As with the demise of Enron, the future of Afghanistan is one in which the 'get rich quick' class at the top will escape with their bounty, while the poor who were encouraged to invest heavily in 'reconstruction' and promised prosperity will be left to live in the rubble."





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