ADDITIONAL FY 2010 BUDGET REQUIREMENTS FOR AFGHANISTAN

UNCLAS KABUL 002103

FOR the Secretary from Ambassador Eikenberry

CENTCOM FOR COMMANDER AND ALSO CSTC-A, USFOR-A

SENSITIVE

SIPDIS

E.O. 12958: N/A
TAGS: EAID ABUD AFIN AF
SUBJECT: ADDITIONAL FY 2010 BUDGET REQUIREMENTS FOR AFGHANISTAN

REF: A) KABUL 1762, B) KABUL 1776


1. (SBU) SUMMARY. Madame Secretary: Embassy Kabul has concluded a
rigorous analysis of U.S. Government civilian assistance programs
required to effectively implement the President's strategy for
Afghanistan and Pakistan. Success will be contingent upon balanced
gains in the fields of security, economic development and
governance. Based upon our review, we have determined that
additional resources totaling $2.515 billion are required beyond
currently available funds and funds already requested in Fiscal Year
(FY) 2010 if we are to show progress over the next 14 months. Our
estimated need for additional civilian staffing has been sent
separately (reftel A). We have provided a detailed expl
anation of
the additional requirements separately to Deputy Secretary Lew, to
the Special Representative for Afghanistan and Pakistan (SRAP)
Ambassador Holbrooke, and to the Acting Director of Foreign
Assistance (F). END SUMMARY.


2. (SBU) In implementing the President's strategy for Afghanistan,
we have adopted an array of innovative tools and approaches (reftel
B). Additionally, we have rigorously examined the resources
required to make substantial progress over the next 14 months.


3. (SBU) In undertaking our analysis, we calculated that success
will be measured by how well we: 1) rapidly shift U.S. assistance to
support counterinsurgency efforts in the South and East; 2)
implement an aggressive agricultural strategy that will stimulate
rural economies and increase incomes and jobs; 3) build the
credibility of the Afghan government by channeling more funding
through their most capable ministries and "Afghanize" our assistance
programs by including many more Afghans in program design and
implementation, among other steps; and 4) target more U.S.
assistance to the provincial and district level through smaller,
more flexible contracts enabled by our rapidly expanding civilian
presence outside of Kabul.


4. (SBU) We have determined that the following additions to our FY
2010 budget are needed to implement the President's strategy:

a.) (SBU) As the military increases its counterinsurgency campaign
in southern and eastern Afghanistan, we require an additional $521
million for targeted stabilization programs in areas of conflict.

b.) (SBU) An expanded program in agriculture ($572 million increase)
and economic growth ($106 million increase) will further stimulate
the creation of jobs in the licit economy and provide economic
opportunity for the Afghan people.

c.) (SBU) Additional funding ($190 million) for roads, vertical
structures (e.g. school buildings),and civil aviation is critical
to provide the infrastructure that permits economic growth.

d.) (SBU) The continued development of the justice and law
enforcement sectors ($221.4 million increase) is essential to
provide an alternative to an inhumane but rapid "Taliban justice"
and to inspire confidence in Afghan government institutions.

e.) (SBU) Additional funding for national and sub-national
governance programs ($194.9 million increase) will accelerate our
efforts to build Afghan capacity to fulfill the basic
responsibilities of government and should improve popular
perceptions of the Afghan government.

f.) (SBU) We must accelerate our efforts to "Afghanize" our foreign
assistance through increased funding for the World Bank-managed
Afghanistan Reconstruction Trust Fund ($450 million) and through
direct budget support ($190 million),which will place increased
responsibility on the Afghan government to deliver basic services to
the Afghan people.

g.) (SBU) Finally, we are requesting additional funding ($70
million) for community-based demining programs.


5. (SBU) The funding requested above ($2.515 billion in total) is in
addition to currently available funds and to the President's FY 2010
base budget request that is now under consideration by Congress.
Though we will seek additional funding for other sectors in FY 2011
(including power, health, education, strategic communications,
counter-narcotics and civil society),we believe that we have
sufficient funding for FY 2009-2010 in these sectors. Available
and anticipated funds for Afghanistan are $6.9 billion, which
includes the existing pipeline (estimated at $1.5 billion),FY 2009
appropriations ($2.6 billion) and the request level in the FY 2010
Congressional Budget Justification ($2.8 billion). We have
calculated all the existing funding streams into our request.

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BACKGROUND & METHODOLOGY
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6. (SBU) We have developed this budget proposal through intensive
collaboration with Deputy Secretary Jacob Lew, Acting Director of
Foreign Assistance Richard Greene, and SRAP Ambassador Holbrooke and
their teams. We have reasoned that we must accept the challenge of
managing substantially higher amounts of funds in order to realize
the strategic gains required over the next 14 months. We have
focused our budget requirements on priorities that also incorporate
innovative approaches and new operational models for managing these
increased funds. For example, we will provide direct budget support
to the Afghan government and increased funding for the World
Bank-managed Afghanistan Reconstruction Trust Fund (ARTF) that do
not require significant increases in USG management because
appropriate compliance and oversight mechanisms are already in
place. New stabilization programs will be accompanied by large
increases in personnel and the introduction of USAID's Office of
Transition Initiatives' (OTI) expertise. We will introduce direct
assistance for agriculture, extend a large and successful
agricultural voucher program, and expand U.S. Department of
Agriculture's presence and programs, which will accelerate our
expenditures of funds. We are also pursuing increased managerial
flexibilities and decentralized authorities to allow us to move more
rapidly. We will continue to work closely with the Special
Inspector General for Afghanistan Reconstruction (SIGAR) and other
Inspectors General to help assure accountability and effectiveness
(reftel B).


7. (SBU) This prioritized request for additional resources
represents a 91 percent increase above the original 2010 request of
$2.767 billion. We understand that there are serious competing
budget needs, but I know you demand our best judgment of the budget
and staffing levels required for success in the months ahead.


8. (SBU) If the additional resources are unavailable, we will
reassess what we can achieve. Meanwhile, we have embarked on
programs possible with our existing funds, including the pipeline,
as well as funds anticipated in FY2010. We have refocused
stabilization and agriculture activities in priority districts to
support the counterinsurgency strategy (COIN); with additional
FY2010 funding, we could increase the number of districts covered
and the depth of our assistance. We will provide modest increases
to our contributions to the Afghan government, the ARTF and the
National Solidarity Program; with additional FY2010 funding, we
could increase these contributions and more effectively build the
capacity and credibility of the Afghan government. With additional
FY2010 resources, the Bureau of International Narcotics and Law
Enforcement (INL) would be able to increase our funding for critical
programs in the justice and corrections sectors, two areas central
to improving the rule of law and the perception of access to justice
in Afghanistan. Similarly, the Federal Aviation Administration
(FAA) could build capacity in the civil aviation sector and begin to
install surveillance and air-to-ground communication systems is
necessary to improve the air traffic system safety and to increase
civilian and military traffic.

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ASSUMPTIONS
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9. (SBU) During our rigorous review, we made the following
assumptions, all of which will be feasible but challenging to
obtain:

-- a.) (SBU) We will be able to recruit and fully staff the selected
programs (Stabilization, Agriculture, Governance, and Economic
Growth.).

-- b.) (SBU) Collaborating with agency headquarters, we will
streamline current USG processes for approval of new programs and
reprogramming of resources, requiring a proper balance of risk
versus benefit. At the field level, we will enhance our own
measures of risk mitigation and accountability, including rigorous
annual performance reviews, increased levels of civilian oversight
of contractors, and close coordination with SIGAR and other
Inspectors General.

-- c.) (SBU) The Department will also seek substantial levels of
funding resources in the FY 2011 budget for areas such as power,
education and health, for which we are not including additional
FY2010 requests.
-- d.) (SBU) Sufficient mobility and force protection
will be
available to program implementers in the field. Given current
conditions, security costs can be as much as 40 percent of project
costs in areas of violent conflict and post-conflict areas.

-- e.) (SBU) The upcoming August 2009 elections will not result in a
significant decrease in the capabilities and willingness of Afghan
officials to cooperate with us on the implementation of our foreign
assistance programs.


10. (SBU) Additional FY 2010 funding would increase effort in those
areas prioritized under
the Administration's new strategy,
prioritize support for Afghan-led capacity building efforts at all
levels, focus on COIN regionally, increase local procurement
initiatives, and channel increased funding through the Afghan
national budget.

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CONCLUSION
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11. (SBU) All agencies at post are now working together under a
whole-of-government approach to achieve the goals specified in the
Administration's strategy: we are working as teams, not
individualized agencies. We are collaborating across our Country
Team to integrate population security with building effective local
governance, economic development, and sustainability. Likewise, we
also are cooperating closely with US Forces/Afghanistan and
International Security Assistance Force (ISAF),with our coalition
partners, with international organizations, and especially with our
hosts, the government of Afghanistan, and Afghan civil society
leaders. We believe that the newly requested funding is vital to
the success of the President's strategy over the next 14 months and
that we can use it efficiently and responsibly. I ask for your
support, and stand ready to discuss our proposal with you further at
your pleasure.


EIKENBERRY