This record is a partial extract of the original cable. The full text of the original cable is not available.

UNCLAS SECTION 01 OF 15 KABUL 005256 
 
SIPDIS 
 
DEPARTMENT FOR SA/FO, SA/A 
TREASURY FOR PARAMESWARAN 
NSC FOR AHARRIMAN, KAMEND 
CJTF-76 FOR POLAD, CENTCOM FOR CG CFC-A 
COMMERCE FOR AADLER 
 
SENSITIVE 
 
E.O.12958: N/A 
TAGS: ECON EFIN EAID PREL PGOV AF
SUBJECT: REVISED AFGHANISTAN COMPACT 
 
Ref:  (A) Kabul 5024 
      (B) Kabul 4939 
      (C) State 219188 
      (D) State 203877 
      (E) State 203877 
      (F) State 203820 
      (G) Kabul 4797 
      (H) Kabul 4634 
 
------- 
Summary 
------- 
 
¶1. (SBU) The GoA pushed back strongly against Washington's 
undercutting the reciprocal balance of the Afghanistan 
Compact but accepted most of our other points.   In a 
December 24 meeting, Senior Economic Advisor to the 
President Naderi and UNAMA Deputy SRSG Haq reviewed with 
Ambassador the latest version of the Afghanistan Compact and 
its three Annexes.  The text was approved by GoA line 
economy and foreign affairs ministers in a December 23 
meeting of the Afghanistan Compact Oversight Committee. 
This cable includes the full text of the December 24 version 
of the Compact, with revisions that reflects consensus 
recommendations reached at a series of Kabul December 2-5 
PrepCom meetings as well as subsequent guidance from donor 
nation capitals, IFI headquarters and Kabul-based G-8 
ambassadors.  We have gained much of what we wanted in this 
latest revision, notably including specific references to 
counter-narcotics program "eradication" efforts in both the 
Chapeau and Annex I benchmark text.  Compromise language has 
been suggested by the GoA to address concerns expressed by 
State/L as to whether our signing the Compact reflects a 
political statement of intent or an open-ended international 
commitment to fund the achievement of all benchmark targets. 
Naderi emphasized the importance of coming to closure soon 
on the makeup of the Annex III coordinating and monitoring 
board, with smaller donors agitating for a formalized role 
and the GoA feeling "caught in the crossfire."  UNAMA's Haq 
suggested that a final resolution of coordinating board 
composition will likely combine a core group of key 
international donor and IFIs representatives, supplemented 
by additional donor and international agency participation 
as both the SRSG and senior GoA representative deem 
appropriate.  The GOA and UNAMA request comments on this 
latest Compact draft NLT January 4.  All comments need to 
come through the Embassy.  Ambassador Neumann told Naderi he 
should disregard any/any comment received directly from any 
individual bureau or agency in Washington.  End Summary. 
 
----------------------------------- 
Compact Chapeau:  Key Modifications 
----------------------------------- 
 
¶2. (SBU)  Strong concern had been expressed the U.S, U.K. 
and Germany on text in the last paragraph of the "Purpose" 
section that could be interpreted to imply an open-ended 
international donor commitment to fund the achievement of 
all Compact benchmark targets.  In this latest version, the 
GoA proposes language that would remove the (here bracketed) 
article "the" from this paragraph to read:  "The Government 
of Afghanistan hereby commits itself to realizing this 
shared vision of the future; the international community 
reciprocally commits itself to provide [the] resources and 
support to realize that vision."  Post supports this 
compromise language. 
 
¶3. (SBU) Naderi explained the importance that the Compact 
Oversight Committee (chaired by Naderi and including the 
Ministers of Finance, Foreign Affairs, Commerce and Economy) 
attaches to keeping both the document title "Compact" and 
the above "the international community reciprocally commits 
itself"  language to maintain the central notion and spirit 
of compact in the document. UNAMA informed Ambassador that 
the UK supports this GoA compromise text. (Comment:  The GoA 
proposal removes the implication that the international 
community has an open-ended commitment to pay for 
everything.  That said, it is essential that the basic 
commitment of the United States to see success in 
Afghanistan be clear as it has been in the past.  End 
Comment). 
 
¶4. (SBU)  In the third sentence of the first paragraph of 
the "Security" section, the GoA has reclamaed donor requests 
that "with the support of the international community" 
language be added to text referring to the creation of a 
secure environment to pursue the DIAG process.  The GoA 
proposes the following compromise language that splits the 
sentence into two parts:  "The Government of Afghanistan and 
the international community will create a secure environment 
by strengthening Afghan institutions to meet the security 
needs of the country in a fiscally sustainable manner.  With 
the support of the international community, the Afghan 
Government will consolidate peace by disbanding all illegal 
armed groups." 
 
¶5. (SBU) Finally, in the Chapeau's "Counter-Narcotics, a 
Cross Cutting Priority," eradication language has been added 
at our request:  "It will also be crucial to enforce a zero- 
tolerance policy towards official corruption; to pursue 
eradication as appropriate; to reinforce the message that 
producing or trading opiates is both immoral and a violation 
of Islamic law; and to reduce the demand for the illicit use 
of opiates." 
 
--------------------------------------- 
Annex I: Benchmarks - Key Modifications 
--------------------------------------- 
 
¶6. (SBU) Key text on ANA and ANP force size in the 
"Security" section of the benchmark Annex remains bracketed. 
Basic service extension goals cited in the Economic 
Development Section's Comprehensive Rural Development 
benchmark have now been vetted and confirmed by Rural 
Development Minister Atmar. A number of edits have been made 
to Annex I benchmarks, including: 
 
-- Bracketed eradication text has been added to the Security 
section Counter-Narcotics benchmark: "The Government will 
strengthen its law enforcement capacity at both central and 
provincial levels, resulting in a substantial annual 
increase in the amount of drugs seized or destroyed and 
processing facilities dismantled, and in effective measures 
toward the elimination [and eradication] of poppy 
cultivation."; 
-- An anti-corruption benchmark was added to the "Governance 
and Rule of Law" section mandating ratification of the UN 
Convention Against Corruption by end 2006; 
-- Statistics data collection language was added to the 
"Governance and Rule of Law" Census benchmark; 
-- Protection of media freedom language was added to the 
"Governance and Rule of Law" Human rights benchmark; 
-- Language on renewable energy was added to the Economic 
Development section's energy benchmark at the request of 
Germany. Energy cost recovery language remains bracketed; 
-- A bracketed Afghan Cultural Heritage benchmark was added 
to the Human Capital section at the request of France; 
--  At the direct request of State/PRM, text was added to 
the Social Protection section's Refugee and IDP benchmark 
stating that refugees and IDP ".integration will be 
supported by national development programs, particularly in 
key areas of return." (Note: Naderi reiterated the GoA's 
earlier (Ref A) request that all/all suggested edits be 
received through Kabul-based ambassadors and we told him in 
the future to disregard any comments not received through 
the Embassy); 
 
-- At the UK's request, language was added to the Economic 
Governance section's Financial Management benchmark 
requiring Afghanistan to "achieve and maintain external debt- 
sustainability by end-2007." 
 
--------------------------------------------- -- 
Annex II: AID Effectiveness - Key Modifications 
--------------------------------------------- -- 
 
¶7.  (SBU) Annex II adds language requested donor provide 
untied aid when possible.  It also adds language committing 
donors to harmonize the delivery of technical assistance to 
reduce duplication and costs. 
--------------------------------------------- ---------- 
Annex III: Coordination/Monitoring - Key Modifications 
--------------------------------------------- ---------- 
 
¶8. (SBU) Finally, in Annex III, language was added at the 
request of the UK and Canada to specify that a "small" 
secretariat will be staffed by the GoA and UN. 
 
SIPDIS 
 
¶9.  (SBU) Naderi emphasized the importance of coming to 
closure soon on the makeup of the Annex III coordinating and 
monitoring board.  Smaller donors excluded from the Compact 
formulation process are "venting," he noted, and the GoA 
feels "caught in the crossfire." UNAMA's Haq suggested that 
a final resolution of the board composition will likely 
combine a core group of key international donor and IFIs 
representatives, supplemented by additional participants as 
both the SRSG and senior GoA representative deem 
appropriate. 
 
------------------------------- 
Final Comments Due by January 4 
------------------------------- 
 
¶10.  At this December 24 meeting, UNAMA Deputy SRSG Haq 
emphasized the need for final comments from G-8 donors by 
January 4 to ensure orderly preparation for the January 31 - 
February 1 London conference. 
 
----------------------------------- 
¶11.  December 24 Compact Draft Text 
----------------------------------- 
 
FYI: Post is also e-mailing copies of the text to key 
Washington addressees for readability.  End FYI 
 
THE AFGHANISTAN COMPACT 
 
The Islamic Republic of Afghanistan and the International 
Community: 
 
Determined to strengthen their partnership to improve the 
lives of Afghan people, and to contribute to national, 
regional, and global peace and security; 
 
Affirming their shared commitments to continue, in the 
spirit of the Bonn, Tokyo, and Berlin conferences, to work 
toward a stable and prosperous Afghanistan, with good 
governance and human rights protection for all under the 
rule of law and to maintain and strengthen that commitment 
over the term of this Compact and beyond; 
 
Recognizing the courage and determination of Afghans who, by 
defying violent extremism and hardship, have laid the 
foundations for a democratic, peaceful, pluralistic and 
prosperous state embracing the principles of Islam; 
 
Noting the full implementation of the Bonn Agreement through 
the adoption of a new constitution in January 2004 and the 
holding of presidential elections in October 2004 and 
National Assembly and Provincial Council elections in 
September 2005, which have enabled Afghanistan to regain its 
rightful place in the international community; 
 
Mindful that Afghanistan's transition to peace and stability 
is not yet assured, and that strong international engagement 
will continue to be required to address remaining 
challenges; 
 
Resolved to overcome the legacy of conflict in Afghanistan 
by setting conditions for sustainable economic growth and 
development; strengthening state institutions and civil 
society; removing remaining terrorist threats; meeting the 
challenge of counter-narcotics; rebuilding capacity and 
infrastructure; reducing poverty; and meeting basic human 
needs; 
 
Have agreed to this Afghanistan Compact. 
 
Purpose 
 
     The Afghan Government has articulated its overarching 
goals for the well-being of its people in the Afghanistan 
Millennium Development Goals Report 2005.  Consistent with 
those goals, this Compact identifies three critical and 
interdependent areas or "pillars" of activity for the five 
years from the adoption of this Compact: 
 
¶1.   Security; 
 
¶2.   Governance, rule of law, and human rights; and 
 
¶3.   Sustainable economic and social development. 
 
     A further vital and cross-cutting area of work is 
eliminating the narcotics industry, which remains a 
formidable threat to the people and state of Afghanistan, 
the region, and beyond. 
 
     The Government of Afghanistan hereby commits itself to 
realizing this shared vision of the future; the 
international community reciprocally commits itself to 
provide [the] resources and support to realize that vision. 
Annex I of this Compact sets out detailed outcomes, 
benchmarks, and timelines for delivery, consistent with the 
high-level goals set by the Afghanistan National Development 
Strategy (ANDS).  The Government and international community 
also commit themselves to improve the effectiveness and 
accountability of international assistance as set forth in 
Annex II. 
 
Principles of Cooperation 
 
     As the Afghan Government and the international 
community embark on the implementation of this Compact, they 
will: 
 
¶1.   Respect the pluralistic culture, values and history of 
Afghanistan, based on Islam; 
 
¶2.   Work on the basis of partnership between the Afghan 
Government, with its sovereign responsibilities, and the 
international community, with a central and impartial 
coordinating role for the United Nations; 
 
¶3.   Engage further the deep-seated traditions of 
participation and aspiration to ownership of the Afghan 
people; 
 
¶4.   Pursue fiscal, institutional, and environmental 
sustainability; 
 
¶5.   Build lasting Afghan capacity and effective state and 
civil society institutions, with particular emphasis on 
building up human capacities, of men and women and boys and 
girls alike; 
 
¶6.   Ensure balanced and fair allocation of domestic and 
international resources in order to offer all parts of the 
country tangible prospects of well-being; 
 
¶7.   Recognize in all policies and programs that men and 
women have equal rights and duties; 
 
¶8.   Promote regional cooperation; and 
 
¶9.   Combat corruption and ensure public transparency and 
accountability. 
Security 
 
     Genuine security remains a fundamental prerequisite for 
achieving stability and development in Afghanistan. 
Security cannot be provided by military means alone.  It 
requires good governance, justice, and the rule of law, 
reinforced by reconstruction and development.  The 
Government of Afghanistan and the international community 
will create a secure environment by strengthening Afghan 
institutions to meet the security needs of the country in a 
fiscally sustainable manner.  With the support of the 
international community, the Afghan Government will 
consolidate peace by disbanding all illegal armed groups. 
 
     To that end, the NATO-led International Security 
Assistance Force (ISAF), the US-led Operation Enduring 
Freedom (OEF), and partner nations involved in security 
sector reform will continue to provide strong support to the 
Afghan Government in establishing and sustaining security 
and stability in Afghanistan. They will continue to 
strengthen and develop the capacity of the national security 
forces to ensure that they become fully functional.  OEF 
forces will continue to conduct counter-terrorism operations 
in close coordination with the Afghan Government and ISAF. 
ISAF will continue to expand its presence throughout 
Afghanistan, including through Provincial Reconstruction 
Teams (PRTs), and will continue to promote stability and 
support security sector reforms in its areas of operation. 
 
     Full respect for Afghanistan's sovereignty and 
strengthening dialogue and cooperation between Afghanistan 
and its neighbors constitute an essential guarantee of 
stability in Afghanistan and the region.  The international 
community will support concrete confidence-building measures 
to this end. 
 
Governance, Rule of Law, and Human Rights 
 
     Democratic governance and the protection of human 
rights constitute the cornerstone of sustainable political 
progress in Afghanistan. The Afghan Government will rapidly 
expand its capacity to provide basic services to the 
population throughout the country.  It will recruit 
competent and credible professionals to public service on 
the basis of merit; establish a more effective, accountable, 
and transparent administration at all levels of Government; 
and implement measurable improvements in fighting 
corruption, upholding justice and the rule of law, and 
promoting respect for the human rights of all Afghans. 
 
     The Afghan Government will give priority to the 
coordinated establishment in each province of functional 
institutions - including civil administration, police, 
prisons and judiciary.  These institutions will have 
appropriate legal frameworks and appointment procedures; 
trained staff; and adequate remuneration, infrastructure, 
and auditing capacity.  The Government will establish a 
fiscally and institutionally sustainable administration for 
future elections under the supervision of the Afghanistan 
Independent Electoral Commission. 
 
     Reforming the justice system will be a priority for the 
Afghan Government and the international community.  The aim 
will be to ensure to all Afghans equal, fair and transparent 
access to justice for all based upon written codes with fair 
trials and enforceable verdicts.  Measures will include 
completing legislative reforms for the public as well as the 
private sector; building the capacity of judicial 
institutions and personnel; promoting human rights and legal 
awareness; and rehabilitating judicial infrastructure. 
 
     The Afghan Government and the international community 
reaffirm their commitment to the protection and promotion of 
rights provided for in the Afghan constitution and under 
international law, including the international human rights 
covenants and other instruments to which Afghanistan is 
party.  With a view to rebuilding trust among those whose 
lives were shattered by war, reinforcing a shared sense of 
citizenship and a culture of tolerance, pluralism, and 
observance of the rule of law, the Afghan Government with 
the support of the international community will implement 
the Action Plan on Peace, Justice and Reconciliation. 
 
Economic and Social Development 
 
     The Afghan Government with the support of the 
international community will pursue high rates of 
sustainable economic growth with the aim of reducing hunger, 
poverty, and unemployment.  It will promote the role and 
potential of the private sector, alongside those of the 
public and non-profit sectors; curb the narcotics industry; 
ensure macroeconomic stability; restore and promote the 
development of the country's human, social, and physical 
capital, thereby establishing a sound basis for a new 
generation of leaders and professionals; strengthen civil 
society; and complete the reintegration of returnees, 
internally displaced persons and ex-combatants. 
 
     Public investments will be structured around the six 
basic priorities of the Afghanistan National Development 
Strategy: 
 
¶1.   Agriculture and rural development; 
 
¶2.   Physical infrastructure; 
 
¶3.   Human capital, including health and education; 
 
¶4.   Social protection; 
 
¶5.   Economic governance; and 
 
¶6.   Private sector development. 
 
     In each of these areas, the objective will be to 
achieve measurable results towards the goal of equitable 
economic growth that reduces poverty, expands employment and 
enterprise creation, enhances opportunities in the region, 
and improves the well-being of all Afghans. 
 
Counter-Narcotics - A Cross-Cutting Priority 
 
     Meeting the threat that the narcotics industry poses to 
national, regional and international security as well as the 
development and governance of the country and the well-being 
of Afghans will be a priority for the Government and the 
international community.  The aim will be to achieve a 
sustained and significant reduction in the production and 
trafficking of narcotics with a view to complete 
elimination.  Essential elements include improved 
interdiction, law enforcement, and judicial capacity 
building; enhanced cooperation among Afghanistan, 
neighboring countries, and the international community on 
disrupting the drugs trade; wider provision of economic 
alternatives for farmers and laborers in the context of 
comprehensive rural development; and building national and 
provincial counter-narcotics institutions.  It will also be 
crucial to enforce a zero-tolerance policy towards official 
corruption; to pursue eradication as appropriate; to 
reinforce the message that producing or trading opiates is 
both immoral and a violation of Islamic law; and to reduce 
the demand for the illicit use of opiates. 
 
Coordination and Monitoring 
 
     The Afghan Government and the international community 
are establishing a joint Coordination and Monitoring Board 
for the implementation of this Compact.  As detailed in 
Annex 3, this Board will be co-chaired by the Afghan 
Government and the United Nations and will be supported by a 
small secretariat.  It will ensure greater coherence of 
efforts by the Afghan Government and international community 
to implement the Compact and provide regular and timely 
reports on its execution to the President, National 
Assembly, Afghan public, international community, and to the 
UN Security Council through the UN Mission. 
 
 
ANNEX 1: BENCHMARKS AND TIMELINES 
 
The Afghan Government, with the support of the international 
community, is committed to achieving the following 
benchmarks in accordance with the timelines specified or 
within the five-year timeframe of this Compact. 
 
Security 
 
International Security Forces 
With the support of and in close cooperation with the Afghan 
authorities, the NATO-led International Security Assistance 
Force (ISAF), Operation Enduring Freedom (OEF) and their 
respective Provincial Reconstruction Teams (PRTs) will 
ensure increased security and stability in all regions of 
Afghanistan, including by strengthening Afghan capabilities. 
 
Afghan National Army 
A fully constituted, professional, functional and ethnically 
balanced Afghan National Army of [up to 70,000] will be able 
to meet the security needs of the country effectively and 
will be increasingly fiscally sustainable. 
 
Afghan National Police 
A fully constituted, professional, functional and ethnically 
balanced Afghan National Police and Afghan Border Police 
with a combined force of [up to 62,000] will be able to meet 
the security needs of the country effectively and will be 
increasingly fiscally sustainable. 
 
Disbandment of Illegal Armed Groups 
All illegal armed groups will be disbanded by end-2007 in 
all provinces. 
 
Counter-Narcotics 
The Government will strengthen its law enforcement capacity 
at both central and provincial levels, resulting in a 
substantial annual increase in the amount of drugs seized or 
destroyed and processing facilities dismantled, and in 
effective measures toward the elimination [and eradication] 
of poppy cultivation. 
 
The Government will work with neighboring and regional 
governments to increase coordination and intelligence 
sharing, with the goal of an increase in the seizure and 
destruction of drugs being smuggled across Afghanistan's 
borders, and effective action against drug traffickers. 
 
Mine Action and Ammunition 
In line with the Millennium Development Goals (MDGs) and 
Afghanistan's Ottawa Convention obligations, by 2010 the 
land area contaminated by mines and unexploded ordnance will 
be reduced by 70%; all stockpiled anti-personnel mines will 
be located and destroyed by end-2007; and all unsafe, 
unserviceable, and surplus ammunition will be destroyed. 
 
Governance, Rule of law and human rights 
 
Public Administrative Reform 
 
Government machinery (including the number of ministries) 
will be restructured and rationalized to ensure a fiscally 
sustainable public administration; the Civil Service 
Commission will be strengthened; and civil service functions 
will be reformed to reflect core functions and 
responsibilities. 
 
A clear and transparent appointments mechanism will be 
established within 6 months, applied within 12 months, and 
fully implemented within 24 months for all senior level 
appointments to the central government and the judiciary, as 
well as for provincial governors, chiefs of police, district 
administrators and provincial heads of security. 
 
By end-2006 a review of the number of administrative units 
and their boundaries will be undertaken with the aim of 
contributing to fiscal sustainability. 
 
Merit-based appointments, vetting procedures and performance- 
based reviews will be undertaken at all levels of 
government, including central government, the judiciary and 
police, and requisite support will be provided to build the 
capacity of the civil service to function effectively. 
Annual performance-based reviews will be undertaken for all 
senior staff (Grade 2 and above) starting by end-2007. 
 
Anti-Corruption 
The UN Convention against Corruption will be ratified by end- 
2006, national legislation adapted accordingly by end-2007 
and a monitoring mechanism to oversee implementation will be 
in place by end-2008. 
 
The Census and Statistics 
The census enumeration will be completed by end-2008 and the 
complete results published. 
 
Reliable statistical baselines will be established for all 
quantitative benchmarks by mid-2007 and statistical capacity 
built to track progress against them. 
 
National Assembly 
The National Assembly will be provided with technical and 
administrative support by mid-2006 to fulfill effectively 
its constitutionally mandated roles. 
 
Elections 
The Afghanistan Independent Electoral Commission will have 
the high integrity, capacity and resources to undertake 
elections in an increasingly fiscally sustainable manner by 
end-2008, with the Government of Afghanistan contributing to 
the cost of future elections from its own resources.  A 
permanent civil and voter registry with a single national 
identity document will be established by end-2009. 
 
Gender 
The National Action Plan for Women in Afghanistan will be 
fully implemented.  In line with Afghanistan's MDGs, female 
participation in all Afghan governance institutions, 
including elected and appointed bodies and the civil 
service, will be strengthened. 
 
Rule of Law 
The legal framework required under the constitution, 
including civil, criminal, and commercial law, will be put 
in place, distributed to all judicial and legislative 
institutions, and made available to the public. 
 
Functioning institutions of justice will be fully 
operational in each province of Afghanistan.  The average 
time to resolve contract disputes will be reduced from 400 
to 300 days. 
 
A review and reform of oversight procedures relating to 
corruption, lack of due process and miscarriage of justice 
will be initiated by end-2006 and fully implemented by end- 
2008; reforms will strengthen the professionalism, 
credibility and integrity of key institutions of the justice 
system (the Ministry of Justice, the Judiciary, the Attorney- 
General's office, the Ministry of Interior and National 
Directorate of Security). 
 
Justice infrastructure will be rehabilitated; prisons will 
have separate facilities for women and juveniles. 
 
Land Registration 
A process for registration of land in all administrative 
units and the registration of titles will be started for all 
major urban areas by end-2006 with a view to completion by 
end-2008.  A fair system for settlement of land disputes 
will be in place by end-2007. Registration for rural land 
will be under way by end-2007. 
 
Counter-Narcotics 
The Government will increase the number of arrests and 
prosecutions of traffickers and corrupt officials, and will 
improve its information base concerning those involved in 
the drugs trade, with a view to enhancing the selection 
system for national and sub-national public appointments, as 
part of the appointments mechanism mentioned earlier in this 
annex. 
 
Human Rights 
The Government's capacity to comply with and report on its 
human rights treaty obligations will be strengthened; state 
security agencies will adopt codes of conduct and procedures 
aimed at preventing arbitrary arrest, torture, extortion and 
illegal expropriation of property with a view to the 
elimination of these practices; media freedom will be 
protected; human rights awareness will be included in 
education curricula, and promoted among legislators, 
judicial personnel and other state agencies and the public; 
independent human rights monitoring carried out by the 
Afghan Independent Human Rights Commission (AIHRC) and the 
UN will track the effectiveness of measures aimed at the 
protection of human rights.  The AIHRC will be supported in 
the fulfillment of its objectives with regard to monitoring, 
investigation, protection and promotion of human rights. 
 
The implementation of the Action Plan on Peace, Justice and 
Reconciliation will be completed by end-2008. 
 
 
Economic and Social Development 
 
Agriculture and rural development 
 
Agriculture and Livestock 
The necessary institutional, regulatory and incentive 
framework to increase production and productivity will be 
established to create an enabling environment for legal 
agriculture and agriculture-based rural industries, and 
public investment in agriculture will increase by 30 
percent. Particular consideration will be given to perennial 
horticulture, animal health and food security by instituting 
specialized support agencies and financial service delivery 
mechanisms, supporting farmers' associations, branding 
national products, disseminating timely price and weather- 
related information and statistics, providing strategic 
research and technical assistance, and securing access to 
irrigation and water management systems. 
 
Comprehensive Rural Development 
Rural development will be enhanced comprehensively for the 
benefit of 19 million people in over 38,000 villages. This 
will be achieved through the election of at least a further 
14,000 voluntary community development councils in all 
remaining villages, promoting local governance and community 
empowerment. Access to safe drinking water will be extended 
to 90% of villages and sanitation to 50%. Road connectivity 
will reach 40% of all villages, increasing access to 
markets, employment and social services.  47% of villages 
will benefit from small-scale irrigation.  800,000 
households (22% of all Afghanistan's households) will 
benefit from improved access to financial services. 
Livelihoods of at least 15% of the rural population will be 
supported through the provision of 91 million labor days. 
 
Counter-Narcotics 
The Government will design and implement programs to achieve 
a sustained annual reduction in the amount of land under 
poppy and other drug cultivation, by the strengthening and 
diversification of licit livelihoods and other counter- 
narcotics measures, as part of the Government's overall goal 
of a decrease in the absolute and relative size of the drug 
economy in line with the Government's MDG target. 
 
Infrastructure 
 
Roads 
Afghanistan will have a fully upgraded and maintained ring 
road, as well as roads connecting the ring road to 
neighboring countries by 2008, and a fiscally sustainable 
system for road maintenance by end-2007. 
 
Air Transport 
Kabul International Airport and Herat Airport will achieve 
full International Civil Aviation Organization compliance. 
Mazar, Jalalabad and Kandahar will be upgraded with runway 
repairs, air navigation, fire and rescue and communications 
equipment; and seven other domestic airports will be 
upgraded to facilitate domestic air transportation.   Air 
transport services and costs will be increasingly 
competitive with international market standards and rates. 
 
Energy 
Electricity will reach at least 65% of households and 90% of 
non-residential establishments in major urban areas, and at 
least 25% of households in rural areas.  [Costs will be 
recovered from at least 75% of users.]  A strategy for the 
development and the use of renewable energies will be 
developed by end-2007. 
 
Mining and Natural Resources 
An enabling regulatory environment will be created by end- 
2006 and the investment environment and infrastructure will 
be enhanced in order to attract domestic and foreign direct 
investment in this area. 
 
Water Resource Management 
Sustainable water resource management strategies and plans, 
covering irrigation and drinking water supply, will be 
developed by end-2006 and irrigation investments will result 
in at least 30% of water coming from large waterworks. 
 
Urban Development 
Municipal governments will have strengthened capacity to 
manage urban development and to ensure that municipal 
services are delivered effectively, efficiently and 
transparently.  In line with Afghanistan's MDGs, investment 
in water supply and sanitation will ensure that 50% of 
households in Kabul and 30% of households in other major 
urban areas will have access to piped water. 
 
Environment 
In line with Afghanistan's MDGs, environmental regulatory 
frameworks and management services will be established for 
the protection of air and water quality, waste management 
and pollution control, and natural resource policies will be 
developed and implementation started at all levels of 
government as well as the community level, by end-2007. 
Human capital 
 
Health and Nutrition 
In line with Afghanistan's MDGs, the Basic Package of Health 
Services will be extended to cover at least 90% of the 
population, maternal mortality will be reduced by 15%, and 
full immunization coverage for infants under-5 for vaccine 
preventable diseases will be achieved and their mortality 
rates reduced by 20%. 
 
Primary and Secondary Education 
In line with Afghanistan's MDGs, net enrolment in primary 
school for girls and boys will be at least 60% and 75% 
respectively; a new curriculum will be operational in all 
secondary schools, female teachers will be increased by 50%; 
70% of Afghanistan's teachers will have passed a competency 
test, and a system for assessing learning achievement such 
as a national testing system for students will be in place. 
 
Higher Education 
Enrolment of students to universities will be 100,000 with 
at least 35% female students. The curriculum in 
Afghanistan's public universities will be revised to meet 
the development needs of the country and private sector 
growth. 
 
Skills Development 
A human resource study will be completed by end-2006, and 
150,000 men and women will be trained in marketable skills 
through public and private means. 
 
Afghan Cultural Heritage 
 
A comprehensive inventory of Afghan cultural treasures will 
be compiled by end-2007.  Measures will be taken to stop the 
trafficking of antiques and to restore damaged monuments and 
artifacts. 
 
Social Protection 
 
Poverty Reduction 
In line with Afghanistan's MDGs, the proportion of people 
living on less than US$1 a day will decrease by 3% per year 
and the proportion of people who suffer from hunger will 
decrease by 5% per year. 
 
Humanitarian and Disaster Response 
 
An effective system of disaster preparedness and response 
will be in place. 
 
Disabled 
Increased assistance will be provided to meet the special 
needs of all disabled people, including their integration in 
society through opportunities for education and gainful 
employment. 
 
Employment of Youth and Demobilized Soldiers 
Employment opportunities for youth and demobilized soldiers 
will be increased through special programs. 
 
 
Refugees and IDPs 
All refugees opting to return and internally displaced 
persons will be provided assistance for rehabilitation and 
integration in their local communities.  Their integration 
will be supported by national development programs, 
particularly in key areas of return. 
 
Vulnerable Women 
The number of female-headed households that are chronically 
poor will be reduced by 20%, and their employment rates will 
be increased by 20%. 
Counter-Narcotics 
The Government will implement programs to reduce the demand 
for narcotics and provide improved treatment for drug users. 
 
Economic Governance and Private Sector Development 
 
Financial Management 
By end-2007, the Government will ensure improved transparent 
financial management at the central and provincial levels 
through establishing and meeting benchmarks for financial 
management agreed with and monitored by the international 
community, including those in the anticipated Poverty 
Reduction Growth Facility (PRGF).  In turn and in line with 
improved government accountability, donors will make every 
effort to increase the share of total external assistance to 
Afghanistan that goes to the Core Budget. 
 
Afghanistan will achieve, and then maintain, external debt 
sustainability by end-2007. 
 
Domestic Revenues 
Afghanistan's total domestic budgetary revenue - equivalent 
to 4.5% of estimated legal GDP in 1383 (2004/05) - will 
steadily increase and reach 8% of GDP by 1389 (2010/11). 
The ratio of revenue to estimated total recurrent 
expenditures, including estimated recurrent expenditures in 
the core and external development budgets, is projected to 
rise from 28% in 1383 (2004/05) to an estimated 58% in 1389, 
resulting in a continuing need, in accord with the 
principles in Annex 2, for (1) external assistance to the 
core budget and (2) increasing cost-effectiveness of 
assistance that funds recurrent expenditure though the 
external development budget. 
 
Private Sector Development and Trade 
All legislation, regulations and procedures related to 
investment will be simplified and harmonized by end-2006 and 
implemented by end-2007.  New business organization laws 
will be tabled in the National Assembly by end-2006.  The 
Government's strategy for divestment of State-Owned 
Enterprises will be completed by end-2008. 
 
Financial Services and Markets 
Internationally accepted prudential regulations will be 
developed for all core sectors of banking and non-bank 
financial institutions by end-2007. The banking supervision 
function of Da Afghanistan Bank will be further strengthened 
by end-2007.  Re-licensing of state-owned commercial banks 
will be complete by end-2006.  State-owned banks that have 
not been re-licensed are liquidated by end-2006. 
 
Regional Cooperation 
 
Afghanistan and it neighbours will achieve lower transit 
times through Afghanistan by means of cooperative border 
management and other multi-lateral or bilateral trade and 
transit agreements.  Afghanistan will increase the amount of 
electricity available through bilateral power purchase and 
cross border hydro projects.  Afghanistan will increase the 
amount of water available for irrigation through agreements 
with riparians of its major river systems. Afghanistan and 
its neighbours will reach agreements to enable Afghanistan 
to import skilled labour from its neighbours and to enable 
Afghans to seek work in the region and send remittances 
home. 
 
Annex 2:  Improving The Effectiveness of Aid to Afghanistan 
 
     The international community has made a significant 
investment in the future of a democratic state of 
Afghanistan since December 2001.  This Compact is an 
affirmation of that commitment.  The Afghan Government and 
the international community are further committed to 
improving the effectiveness of the aid being provided to 
Afghanistan in accordance with the `Paris Declaration on Aid 
Effectiveness' recognizing the special needs of Afghanistan 
and their implications for donor support. 
 
      Consistent with the Paris Declaration and the 
Principles of Cooperation of this Compact, the Government 
and the international community providing assistance to 
Afghanistan agree that the principles for improving the 
effectiveness of aid to Afghanistan under this Compact are: 
 
a)   Leadership of the Afghan Government in setting its 
development priorities and strategies and within them the 
support needs of the country and the coordination of donor 
assistance; 
 
b)   Transparency and accountability on the part of both the 
Government and the donors of the international assistance 
being provided to Afghanistan; 
 
Under these principles and towards the goal of improving the 
effectiveness of aid to Afghanistan, the Government will: 
 
-- Provide a prioritized and detailed Afghanistan National 
Development Strategy (ANDS) with indicators for monitoring 
results, including those for the Afghanistan Millennium 
Development Goals (MDGs); 
 
-- Improve its ability to generate domestic revenues 
through, inter alia, customs duties and taxes; and to 
achieve cost recovery from public utilities and 
transportation; 
 
-- Agree with the donors, international financial 
institutions and United Nations agencies on the benchmarks 
for channeling aid through the Government's core budget and 
for the utilization of such aid; monitor performance against 
those benchmarks; 
 
--  Provide regular reporting on the use of donor assistance 
and performance against the benchmarks of this compact to 
the National Assembly, the donor community through the 
Afghanistan Development Forum, and the public at large; 
 
The donors will: 
 
-- Provide assistance within the framework of the 
Afghanistan National Development Strategy.  Programs and 
projects will be agreed with Government in order to focus on 
priorities, eliminate duplication and rationalize donor 
activities to maximize cost-effectiveness; 
 
-- Increasingly provide more predictable and multi-year 
funding commitments or indications of multi-year support to 
Afghanistan to enable the Government to plan better the 
implementation of its National Development Strategy, and 
provide untied aid whenever possible; 
 
-- Increase the proportion of donor assistance channeled 
directly through the Afghanistan Core Budget, as agreed bi- 
laterally between the Government and each donor, and as well 
as through other more predictable Core Budget funding 
modalities in which the Afghan Government participates such 
as the Afghanistan Reconstruction Trust Fund (ARTF), the Law 
and Order Trust Fund for Afghanistan (LOTFA) and the Counter- 
Narcotics Trust Fund (CNTF); 
 
-- Provide assistance for the development of public 
expenditure management systems which are essential for 
improving transparency and accountability in the utilization 
of donor resources and countering corruption; 
 
-- Recognize that because of the need to build Afghan 
capacity, donor assistance provided through the external 
budget will be designed in such a manner as to build this 
capacity in the Government as well as the private sector and 
non-profit sector; 
-- Ensure that development policies, including salary 
policies, strengthen national institutions that are 
sustainable in the medium to long-term for delivery of 
programs by the Government; 
 
For aid not channeled through the Core Budget endeavor to: 
 
-- harmonise the delivery of technical assistance in line 
with Government needs, to focus on priority areas and reduce 
duplication and transaction costs; 
 
-- reduce the external management and overhead costs of 
projects by promoting the Afghan private sector in their 
management and delivery; 
 
-- increasingly use Afghan national implementation partners 
and equally qualified local and expatriate Afghans; 
 
-- increase the procurement within Afghanistan of supplies 
for civilian and military activities; and 
 
-- use Afghan materials in the implementation of projects, 
in particular for infrastructure; 
 
 
 
 
 
-- Within the principles of international competitive 
bidding, promote the participation in the bidding process of 
the Afghan private sector and South-South cooperation in 
order to overcome capacity constraints and to lower costs of 
delivery; 
 
-- Provide timely, transparent and comprehensive information 
on foreign aid flows, including levels of pledges, 
commitments and disbursements in a format that will enable 
the Afghan Government to plan its own activities and present 
comprehensive budget reports to the National Assembly.  This 
covers the nature and amount of assistance being provided to 
Afghanistan through the core and external budgets; and 
 
-- For external budget assistance, also report to the 
Government on the utilization of funds; its efficiency, 
quality and effectiveness; and the results achieved. 
 
 
     These mutual commitments are intended to ensure that 
the donor assistance being provided to Afghanistan is used 
efficiently and effectively, that there is increased 
transparency and accountability, and that both Afghans and 
the taxpayers in donor countries are receiving value for 
money. 
 
 
Annex 3: Coordination and Monitoring 
 
The Islamic Republic of Afghanistan and the international 
community recognize that the success of the Afghanistan 
Compact requires strong political, security and financial 
commitment to achieve the benchmarks within the agreed 
timelines.  Equally, the success of the Compact relies on an 
effective coordination and monitoring mechanism. 
 
To ensure comprehensive and timely implementation of this 
Compact the Afghan Government and the international 
community are establishing a joint Coordination and 
Monitoring Board with the participation of senior Afghan 
Government officials appointed by the President and 
representatives of the international community.  The Board 
will be co-chaired by a senior Afghan Government official 
appointed by the President and the Special Representative of 
the UN Secretary-General for Afghanitan.  The Coordination 
and Monitoring Board, in addition to existing sectoral 
coordination mechanisms, will provide overall coordination 
for the implementation of the Compact. 
The Board will have a small secretariat staffed by the 
Afghan Government and the United Nations.  It will be 
supported by technical experts, as needed. The Board will 
hold periodic meetings and special sessions as required to 
review the implementation of the Compact and suggest 
corrective action, as appropriate. 
Afghan state institutions and sectoral coordination 
mechanisms involved in the implementation of the Afghanistan 
National Development Strategy (ANDS) will provide inputs to 
the Board with regard to the implementation of the Compact. 
In addition, in carrying out its assessments, the Board will 
consider inputs from the international community including 
United Nations agencies, International Financial 
Institutions, donor agencies, international security forces, 
and relevant non-governmental organizations and civil 
society representatives. 
Periodic progress reports on the implementation of the 
Compact prepared by the Coordination and Monitoring Board 
will be made to the President, the National Assembly, 
public, the international community and the UN Security 
Council through the UN Mission.