Afghan Government Requests Intervention in Contract Dispute

UNCLAS KABUL 000538 SENSITIVE SIPDIS DEPT FOR EUR/RPM, IO, EEB/TRA, S/SRAP, SCA/FO, SCA/A MONTREAL PLEASE PASS TO USMISSION ICAO E.O. 12958 N/A TAGS: EAIR EAID PGOV PREL AF SUBJECT: Afghan Government Requests Intervention in Contract Dispute with ICAO ¶1. (SBU) This is an action request for U.S. Mission to ICAO, U.S. Mission to NATO and FAA. See paragraph 8. ¶2. (SBU) Summary: The Ministry of Transportation and Civil Aviation (MOTCA) is increasingly agitated by the performance of contractors working for the International Civil Aviation Organization (ICAO). While successful in auditing several Afghan airlines, contracted safety inspectors have made little progress in training Afghans or creating policies and handbooks for MOTCA, tasks specified in the contract agreement. MOTCA has asked ICAO to audit the project and send management staff to Kabul for monitoring. During a visit by FAA Acting Deputy Administrator David Grizzle, MOTCA officials asked the USG to intervene and urge ICAO to fulfill the conditions of its contract. Rather than address MOTCA's concerns, ICAO has asked NATO for help in identifying new donors and expressed a desire to remove oversight from the Minister - effectively sidelining Afghan leadership of this important project. Post requests the Department seek assistance from the U.S. Mission to ICAO and FAA in engaging the organization and putting this expensive contract back on track. End Summary. ¶3. (SBU) Using donor funding, MOTCA contracts with ICAO's Technical Cooperation Bureau (TCB) for two projects in Afghanistan: a $16.8 million training program for air traffic management at Kabul International Airport (KIA) ending June 2010 and a one-year aviation safety contract that cost $1.2 million and will expire in March. The air traffic management project supports transitioning KIA operations from ISAF to Afghan civilian control and creating professional standards at the airport. ¶4. (SBU) These programs have been in place for two years, under the supervision of highly paid ($20,000/month) ICAO-employed international contractors. In a November 1 letter to ICAO Project Manager Steve Irwin, then-Minister of Transport Hamidullah Farooqi complained the contractors have not executed their assigned tasks and instead spend most of their time at the Ministry. He said contractors have only trained 16 Afghans in basic air traffic control, and of those, ten had already received Federal Aviation Administration (FAA)-sponsored training. The contractors have not compiled manuals, equipped the Civil Aviation Training Institute or purchased $5.1 million of equipment necessary for training as specified in the MOTCA - ICAO scope of work. Several USG employees who work directly with MOTCA have confirmed the absence of these activities. In the letter, Farooqi said MOTCA will not release the final $1.8 million due to ICAO until he receives full accounting of the program. ¶5. (SBU) On December 13, Farooqi sent a letter to ICAO Secretary General Raymond Benjamin requesting that ICAO complete a full external and performance audit of the program by February 1. A provision allowing such an audit is included in the contract. ICAO responded January 5 that it was searching for an auditor after the firm it usually employs declined to take the case. (Note: This letter did not reach MOTCA until February 9, when Post received and forwarded it. End note.) ¶6. (SBU) In a series of meetings in early February with FAA Acting Deputy Administrator David Grizzle, Deputy Minister of Transportation Raz Alami asked Grizzle to intercede in this sensitive matter. (Note: Following Afghan elections, Farooqi was not reappointed as Minister. We expect a new Minister to be in place in March.) Alami said he was hesitant to escalate the conflict directly due to Afghanistan's relationship with ICAO, which will audit its airports and aviation security. ¶7. (SBU) Rather than addressing MOTCA's concerns and threats to withhold further funding, ICAO has approached NATO for assistance. The ICAO project manager reported February 6 that ICAO plans to ask NATO to help it obtain donor funding for a $100 million extension and expansion of the existing program -- circumventing the Afghan Government and its concerns. The ICAO representative said he believes somebody "above" the Minister of Transportation needs to oversee the contract. This contradicts USG goals to build capacity within MOTCA, which has so far shown proper financial management of this program. NATO has consistently attempted to assist ICAO without taking into account feedback from MOTCA, which we also believe is counterproductive. Post is working with MOTCA to form a Civil Aviation Working Group composed of major donors, in which this and other capacity building issues can be addressed. This group is tentatively scheduled to meet for the first time in April. ¶8. (SBU) Action Request: Post requests the Department ask the U.S. Mission to NATO to provide more information regarding NATO plans to support and seek funding for this program. Post also requests the Department seek U.S. Mission to ICAO and FAA Headquarters to raise this issue at the highest levels of ICAO and remind the organization of its obligation to work through the Afghan Government and abide by the terms of the contract. EIKENBERRY