In December 2002, the United States passed the Afghanistan Freedom  Support Act of 2002, authorizing increased assistance to Afghanistan. The  strategy did not include reconstruction. In contrast to fiscal  years 2002-2003, when more than three-fourths of U.S. spending was for  humanitarian and quick-impact assistance, approximately 75 percent—  about $538 million—of the 2004 expenditures supported reconstruction  and development projects. United States Remained Largest International Donor

As in previous years, the United States provided the largest share of  international assistance to Afghanistan, contributing about 38 percent of  the $3.6 billion pledged by the international community for 2004. U.S. Assistance Benefited Afghanistan, but Accelerated Reconstruction Did Not Meet All Targets

U.S. humanitarian and quick-impact assistance benefited vulnerable  populations and returning refugees; however, the success of efforts to  accelerate large-scale reconstruction varied. Further, the United States accelerated its major reconstruction  programs to increase visible progress before the 2004 Afghan presidential  elections. Finally, despite a  goal of building or rehabilitating 10 courthouses by the end of fiscal year  2004, according to USAID and contractor reporting, only 7 were completed  due to late funding. USAID also instituted several other smaller education-focused projects in  2004. In addition, USAID did not always enforce required  contract provisions, USAID directives, or a federal acquisition regulation  necessary to hold contractors accountable for their performance. Economic governance. All sectors. Owing to these weaknesses and other problems, the performance  measures that the Kabul mission provided to decision makers in  Washington, D.C., did not completely portray the status of each sector or  the overall Accelerating Success initiative. This  ratio improved by September 2004 after USAID increased its staff from 41  to 101. For example, the mission had three different directors in fiscal year  2004. The United States and the international community continued to take steps  to improve security in Afghanistan. Delayed Funding Negatively Impacted Acceleration Efforts

Delayed funding continued to negatively impact the U.S. assistance effort  in Afghanistan in fiscal year 2004. Conclusions

Afghanistan has made progress since the fall of the Taliban in October  2001. To meet the  requirements of the directive and provide Congress with a comprehensive  accounting of U.S. assistance to Afghanistan for the fiscal year 2004 period,  we analyzed (1) U.S. obligations and expenditures, (2) the progress and  results of U.S. humanitarian and reconstruction efforts, (3) the  management of U.S. assistance and mechanisms to coordinate U.S. and  international assistance, and (4) the major factors that obstructed the  advancement of the assistance effort and the achievement of U.S. policy  goals.
Why GAO Did This Study

In October 2001, coalition forces forcibly removed the Taliban regime from Afghanistan, responding to their protection of al Qaeda terrorists who attacked the United States. Congress subsequently passed the Afghanistan Freedom Support Act of 2002 authorizing funds to help Afghanistan rebuild a stable, democratic society. The act directed GAO to monitor the implementation of U.S. humanitarian, development, and counternarcotics assistance. This report analyzes, for fiscal year 2004, (1) U.S. obligations and expenditures, (2) progress and results of assistance efforts, (3) assistance management and coordination, and (4) major obstacles that affected the achievement of U.S. goals.

What GAO Found

The United States spent $720 million on nonsecurity-related assistance to Afghanistan in fiscal year 2004. Approximately 75 percent paid for reconstruction activities, with the remainder supporting humanitarian and quick-impact projects. Conversely, in 2002-2003, humanitarian and quick-impact assistance accounted for more than three-fourths of U.S. spending. The United States continued to be the largest donor, contributing about 38 percent of the $3.6 billion pledged by the international community. U.S. humanitarian assistance benefited vulnerable populations in fiscal year 2004. Further, the United States increased reconstruction assistance to Afghanistan and made notable progress in several sectors through its "Accelerating Success Initiative". Although progress varied among sectors, the United States did not meet all of its targets due to security and other obstacles. For example, USAID intended to rehabilitate or build 286 schools by the end of 2004. However, owing to poor contractor performance and security problems, by September 2004 it had completed only 8. As in 2002-2003, complete financial information was not readily available, and USAID lacked a comprehensive strategy to direct its efforts. Further, USAID did not consistently require contractors to fulfill contract provisions needed to ensure accountability and oversight. USAID also did not systematically collect information needed to assess the progress of its major projects. Moreover, measures provided by the embassy to decision-makers in Washington did not comprehensively portray progress in each sector or the overall U.S. program. Deteriorating security, increased opium production, and delayed funding continued to obstruct U.S. reconstruction efforts in fiscal year 2004 and threatened the achievement of U.S. goals. Deteriorating security rendered large areas inaccessible to the assistance community, and the continued rise in opium production undermined legitimate economic activity. In addition, most assistance funds were not available until nearly 6 months into the fiscal year, preventing USAID from accelerating reconstruction efforts.