UNCLAS SECTION 01 OF 04 KABUL 001816

SENSITIVE
SIPDIS

STATE FOR SCA FOR A/S BOUCHER AND PMOON
STATE PASS TO USAID FOR AID/ANE, AID/CDHA/DG
NSC FOR JWOOD
OSD FOR MSHIVERS
CENTCOM FOR CG CJTF-101 AND POLAD

E.O. 12958: N/A
TAGS: PGOV PREL ECON PTER EAID AF
SUBJECT: SCENESETTER FOR VISIT OF CODEL REED TO AFGHANISTAN

Introduction
--------------


1. (SBU) Afghanistan remains a complex counterinsurgency
environment, in which maintaining strong U.S. support for the
Afghan government and robust U.S. leadership of international
community assistance efforts is critical to ensuring that
momentum for victory remains with us. Press reporting
emphasizes dramatic attacks, extremist atrocities, and
security threats from increased infiltration from Pakistan
but frequently passes over genuine advances in our
counter-insurgency and nation-building strategy as we build
Afghan security forces, improve local governance, broaden
access to social services (e.g., public health, education),
and advance economic development and infrastructure projects.
Seven years into this fight, we have rediscovered
counterinsurgency lessons learned from past conflicts. Now,
where the U.S. is present, we are putting in the necessary
levels of security, development and governance resources,
and, as a result of an Afghan Government restructuring in
2007, we are getting real traction by partnering with more
effective provincial governors. The U.S. has a strategy
(grounded on an even better understanding of the human and
political terrain here), and it works.


2. (SBU) The challenge remains that the extremists have a
vote on the issue. They discovered over the last two years
that they cannot win a straight-up fight with either Afghan
army or Coalition forces. Effective counterinsurgency
practices, especially in the U.S.-led Regional Command-East
(RC-East), over the last couple of years succeeded in
separating insurgents from the people, permitting the
application of U.S. development and governance assistance to
begin to build, in close concert with provincial and local
Afghan officials, new connections between the people and the
government. The extremists have adjusted their tactics to
avoid direct confrontations with Afghan army and Coalition

forces, resorting (with some exceptions) to improvised
explosive devices and suicide attacks and to direct attacks
on development and governance targets, including local
officials who cooperate with the Government and the
international community.


3. (SBU) We will not win by focusing on defeating the
extremists, although security operations remain critical.
Rather, we need to focus on strengthening the Government,s
capacity to deliver security and services to the people.
After thirty years of invasion and civil war, however,
Afghanistan does not have an educated middle class and its
leadership has been depleted. This is compounded by
pervasive corruption, fed by the opium trade, which in turn
reinforces the weakness of government structures. In
addition, Karzai is perceived by some to be more focused on
reviving a traditional tribally-based approach than in
building up an established government structure. Progress is
being made in some institutions ) the army, more recently
the police, sub-national governance ) and some ministries
have advanced under strong leadership. The international
community signaled its commitment to Afghanistan,s stability
when it pledged more than $20 billion at the June Paris
Conference, and a new UN Special Representative is bring new
energy and idea to improve coordination among international
donors and the Government. But as the largest military and
development contributor, the international community and the
Afghans will continue to the look to the U.S. to lead.

Politics and Governance
--------------


4. (SBU) Maneuvering among politicians is already well
underway for the fall 2009 presidential election, with
parliamentary elections to follow in 2010. As a result,
legislative debate and ministerial decisions are increasingly
complicated by political calculus. Driving that calculus in
part are endemic ethnic rivalries among Pashtuns, Tajiks,
Uzbeks and Hazaras, (among others) and a effort to tap (or
for incumbents, to deflect) the frustrations many Afghans
express resulting from unrealized (and in many cases
unrealistic) expectations for security and economic
prosperity.

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5. (SBU) President Karzai's cabinet represents a
cross-section of Afghanistan, but ministries vary in
effectiveness. Strong leadership in key ministries
(Education, Health, Rural Rehabilitation and Development, and
Finance) has produced significant achievements in some
sectors, while other ministries continue to suffer from weak
leadership and capacity as well as corruption. USAID's
Capacity Development Program works with several ministries,
and we support the World Bank's work with the Civil Service
Commission to develop a national network of training
institutes.


6. (SBU) A positive development of the last year is the new
Independent Directorate for Local Governance (IDLG). IDLG
Director Popal has instituted a more rigorous review process
for gubernatorial candidates, to include (e.g.) technical
competence and personal probity. The growing numbers of
IDLG-vetted governors are becoming the focal points for
reconstructing provincial institutions to deliver government
services. An ambitious program is underway to review local
governance policy, and redraft the laws that that define
roles and responsibilities at the provincial, district and
municipal levels.

Security
--------------


7. (SBU) Fed by increased cross-border incursions from
Pakistan of both Taliban and foreign fighters, engagement
with insurgents is up overall, but the increased number of
&troops in contact8 also reflects growing numbers of Afghan
and Coalition forces in the field taking the initiative to
extend security and governance into areas where the Afghan
government and the NATO-led International Security Assistance
Force (ISAF) presence had been minimal or non-existent. As a
result of the pounding they took last year, insurgents
largely avoid large-scale operations ) with some notable
exceptions in Helmand and Konar provinces ) in favor of
improvised explosive devices, suicide attacks and small unit
ambushes.


8. (SBU) RC-East remains focused on a balanced COIN approach
synchronizing operations to protect the populace and push the
insurgents out while pursuing mutually reinforcing efforts in
development and governance assistance; the Embassy, USAID and
CJTF-101 are coordinating more closely than ever USG efforts
in RC-East. The Commanders, Emergency Response Program
(CERP) funding is critical to delivering quick, effective
assistance projects, which, in coordination with USAID and
local officials, supports both locally identified needs and
longer term development goals.


9. (SBU) In RC-South, the number and lethality of IED attacks
is up dramatically; significantly, in some areas the number
of IEDs reported by the public to Afghan or ISAF forces is
also up, reflecting public support for the Government. The
approximately 2300 Marines of the 24th Marine Expeditionary
Unit (MEU) have carried out successful operations in the
Garmsir District in Helmand and their mission has been
extended to consolidate the resulting governance and
development opportunities. RC-West and RC-North remain
relatively quiet.

Building Afghan Security Forces
--------------


10. (SBU) Using FY 2007 supplemental funding (about $4.9
billion for the army, and $2.5 billion for the police), the
U.S. Combined Security Transition Command-Afghanistan
(CSTC-A) has re-made the Afghan army and is concentrating now
on the police. The army is already the most respected
national institution in Afghanistan and is increasingly
capable and confident. We are on track to fill the currently
authorized force structure of 86,000 (which includes a
6,000-troop &float8) by fall 2009. Four Afghan battalions
are now certified to carry out independent operations, and
additional units are expected to achieve similar
certification over the course of 2008. The Afghan army
responded impressively to the June Taliban incursion into the

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Arghandab District in Kandahar, using Afghan Army Air Corps
assets to move roughly 50% of the approximately 1000 Afghan
army reinforcements to Kandahar from Kabul and taking the
lead in planning and executing a successful joint combat
operation, with ISAF support, against the Taliban. The
Afghan Ministry of Defense has just launched an effort to win
international community support for a force structure
increase to 134,000 (which also includes a 12,000-troop
&float8) which the U.S. supports. The army will continue
to depend for some years on Coalition enablers such as close
air support and intelligence assets.


11. (SBU) We have had less success re-building Afghanistan,s
weak, corrupt police force. However, in December 2007,
CSTC-A launched the Focused District Development (FDD)
Program, a district-by-district program to retrain and
reequip the police. The first FDD cycle began in December
with seven districts; 55 districts are scheduled to be
retrained by December 2008. FDD will take between 4-5 years
to reach all 364 districts of Afghanistan. Once back in
their respective districts, the ANP are gaining respect for
the first time from local residents for carrying out their
missions. Beyond its immediate relevance to the police, FDD
is becoming the focal point around which the U.S. is
advancing its coordinated counterinsurgency strategy.
Continued FDD coordination with the Afghan government, ISAF,
USAID and the international community will ensure that
sustainable security improvements in the most critical
districts in the country will be linked to enhanced local
governance, rule of law, and reconstruction and development
projects.

Development and Economic Growth
--------------


12. (SBU) The Afghan economy grew by 11.5 percent in Afghan
fiscal year 2007 (which ended March 20, 2008), thanks largely
to greater agricultural production. While annual GDP growth
rates averaged over 12 percent for the past five years,
Afghanistan remains one of the poorest countries in the
world. With poor agricultural growth and higher inflation
this year, the IMF estimates that GDP growth will drop to 7.5
percent for fiscal year 2008 (which ends March 20, 2009),
forcing the government to make two food aid appeals this
year. The United States has already responded by donating
30,000 MT of wheat through the World Food Program, and
additional assistance is being planned. Afghanistan,s IMF
program remains on track, however, despite the government,s
recent challenges in meeting IMF revenue collection
benchmarks.


13. (SBU) U.S. economic development priorities are energy,
roads, agriculture, and private sector development. In the
power sector, USAID is now funding four major electricity
projects, including the strategic Kajaki Dam in Helmand and
the North East Power System to import cheap power from
northern neighbors. USAID is also constructing hundreds of
kilometers of strategic roads while employing Afghan workers
to create jobs, cut costs, and train the workforce. To help
with the food supply, USAID is supporting increased
production of food crops and agricultural exports.

Counter-Narcotics
--------------


14. (SBU) In its 2007 report, the UN Office on Drugs and
Crime (UNODC) reported that Afghanistan's poppy crop reached
record levels, with some 193,000 hectares under cultivation.
Favorable weather compounded the problem, resulting in
Afghanistan alone producing 8,200 tons, or 93 percent of the
world's opium. In its Rapid Assessment Survey, released in
February 2008, the UNODC is predicting 2008 will see
nation-wide cultivation levels similar to or slightly lower
than 2007.


15. (SBU) Successes in reducing production in the east and
north, and the links between the insurgency and continuing
high levels of production in the south, are reflected in a
growing segmentation of Afghan poppy production as well as a
growing nexus between drugs and insurgents. We are seeing

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positive results by committed governors where security allows
for effective counter-narcotics campaigns. For example, the
UNODC and the U.S. predict poppy cultivation has been slashed
in Nangarhr Province, where cultivation had increased by 85
percent in 2007. Kabul plans to hold govenors accountable
for poppy production in their provinces. The Government has
also committed to support stronger eradication measures,
including army-provided force protection for polce
eradication efforts. President Karzai, on the advice of his
cabinet, decided against the use of chemical spray for
eradication in 2008.

Regional Dynamics
--------------


16. (SBU) Afghanistan's effort to build a secure and stable
state is complicated by its relationships with its neighbors.
Karzai, who is already predisposed against Pakistan for its
perceived manipulation and radicalization of Pashtun tribes
in the border area, has renewed his public attacks on the
Pakistani military and intelligence services over increased
cross-border infiltration of extremists and allegation of a
Pakistani hand behind recent events such as the June
jailbreak in Kandahar and the July bombing of the Indian
Embassy.


17. (SBU) Mre than half of all Afghans speak Dari, which is
closely related to Farsi. Many Afghans along the border in
the west look towards Iran for news, entertainment, jobs,
education, medical care and, among Afghanistan,s more than
three million-strong Shia population, religious guidance.
Afghans fear that tensions over Iran,s nuclear ambitions
could erupt into a war that would embroil them.
WOOD