VZCZCXRO5447
RR RUEHDBU RUEHPW RUEHSL
DE RUEHBUL #0593 0480903
ZNR UUUUU ZZH
R 170903Z FEB 10
FM AMEMBASSY KABUL
TO RUEHC/SECSTATE WASHDC 5642
INFO RUCNAFG/AFGHANISTAN COLLECTIVE
RUCPDOC/DEPT OF COMMERCE WASHINGTON DC

UNCLAS KABUL 000593 
 
SENSITIVE 
SIPDIS 
 
DEPT PASS AID/W FOR TYLER HOLT, MARK KARNS, AND DIANE RAY 
COMMERCE FOR DEES, CHOPPIN, AND FONOVICH 
 
E.O. 12958: N/A 
TAGS: ECON EAID ETRD PGOV EINV EIND AF
SUBJECT: AN UNDEFINED MISSION AT THE MINISTRY OF ECONOMY 
 
¶1.  (SBU) Summary: In a January 24 meeting, newly-appointed Minister 
of Economy Abdul Hadi Arghandewal discussed his plans for the 
Ministry with Ambassador Eikenberry and Coordinating Director for 
Development and Economic Affairs Ambassador Wayne.  Minister 
Arghandewal indicated that he would develop an economic plan for the 
future, install an updated database, and compile statistical 
information for individuals and entities interested in investing in 
Afghanistan.  He appears well intentioned, but evinced a limited 
grasp of the Ministry's responsibilities and struggled to articulate 
a vision for his institution.  End Summary. 
 
¶2.  (U) Ambassadors Eikenberry and Wayne visited newly-confirmed 
Minister of Economy Abdul Hadi Arghandewal on January 24 to 
congratulate him and to seek his vision for the ministry's future. 
Arghandewal highlighted the need for improved design and monitoring 
of development projects, adding that his Ministry should "clear" 
development projects.  The Ministry should increase its capacity to 
analyze projects and collect baseline data and statistics and also 
have a "department for making projects."  Another priority was to 
better evaluate development projects implemented by donors.  The 
Ministry of Economy, he continued, has one advisor who is working on 
the Afghan National Development Strategy.  To achieve his goals, he 
sought donor assistance to develop modern databases. 
 
¶3.  (U) The Minister attempted to articulate the role of the 
Ministry, which was downgraded in July 2009 when it lost authority 
over development budget allotments to the Ministry of Finance. 
(Note:  This resulted after Finance Minister Zakhilwal protested to 
President Karzai that Economy was ineffective in this area.  End 
Note.)  Arghandewal noted, however, that the Ministry of Economy 
retains responsibility for monitoring and evaluating development 
projects, although Ministry of Finance responsibility for auditing 
development projects dilutes even this limited role to the physical 
monitoring of projects.  The Minister noted that he has 950 
employees, 250 of whom are based in the provinces.  He did not 
expand on how the 700 employees in Kabul are being utilized, but 
stressed that he would focus the Ministry's efforts on reducing 
poverty in the country. 
 
¶4.  (U) Aside from project oversight, Arghandewal said the Ministry 
Economy's other major function is registering and supervising 
charities and NGOs.  He lamented the fact that over 1,400 NGOs and 
charities are registered in Afghanistan and receive support from 
donors but that the Ministry has little idea of what they are doing 
or accomplishing. 
 
¶5.  (U) Ambassador Eikenberry asked Arghandewal about the 
possibility of reintegrating Taliban and other insurgents into 
Afghan society, a policy the minister has been supporting. 
Responding that while he was moderately optimistic, he was less 
sanguine about Gulbuddin Hekmatyar (whom he once served as finance 
chief).  Arghandewal expressed hope that Saudi Arabia would play an 
important role in the reintegration process, given Afghan trust in 
its leadership. 
 
¶6.  (SBU) COMMENT: Minister Arghandewal appears well intentioned, 
but he evinced a limited grasp of the Ministry's responsibilities 
and struggled to articulate a vision for his institution.  We have 
serious concerns about the Ministry of Economy's ability to oversee 
an effective NGO and charity regime, as an ineffective oversight 
regime presents a money laundering and terrorist financing 
vulnerability.  The Embassy will therefore continue to engage with 
the Minister and encourage him to take a more active role in helping 
to prioritize ANDS objectives and to implement effective NGO and 
donor oversight mechanisms. End Comment. 
 
EIKENBERRY