This report – the third in a series of lessons learned reports by SIGAR – examines the U.S. government’s support to private sector development in Afghanistan since 2001, through efforts led by the U.S. Agency for International Development and additional significant roles played by the Departments of State, Defense, Commerce, and Treasury.
SIGAR’s analysis highlights the difficulty of supporting economic development in a war-shattered country. Afghanistan’s early economic gains were largely due to foreign spending and were not sustainable. Optimistic predictions of future progress did not reflect the reality of Afghanistan’s economic and security environment, the capacity of institutions, its relations with its neighbors, or the impact of corruption. The U.S. government and other stakeholders failed to understand the relationships between corrupt strongmen and powerholders, and the speed at which Afghanistan could transition to a Western-style market economy.
A former U.S. government official
“Many of these warlords became multimillionaires overnight. They had access and control. Powerful people controlled access to markets, including inputs and labor markets.”
The report identifies lessons to inform U.S. policies and actions at the outset of and through a reconstruction and provides recommendations for improving private sector development efforts. These lessons and recommendations are relevant for ongoing work in Afghanistan – where the U.S. government remains engaged in building and supporting the Afghan economy – and in future endeavors to rebuild other weak states emerging from protracted conflict.
Dov Zakheim, former DOD Comptroller
“The U.S. government did not engage, anywhere in any of its various departments and agencies, in extensive planning for a post-Taliban Afghanistan. There was no time, and not much incentive, to do so…The assumption was that the international community would pick up the pieces after the Taliban regime was displaced.”