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### Viewing cable 09KABUL3714, C) AFGHAN COMMERCE MINISTER DISCUSSES REFORM AGENDA

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Reference ID | Created | Released | Classification | Origin
--- | --- | --- | --- | ---
09KABUL3714 | 2009-11-18 15:03 | 2010-12-02 21:09 | CONFIDENTIAL//NOFORN | Embassy Kabul

`

    VZCZCXYZ0025
    RR RUEHWEB

    DE RUEHBUL #3714/01 3221518
    ZNY CCCCC ZZH (CCY ADXDBACF8 MSI8971 540A)
    R 181518Z NOV 09 ZDS
    FM AMEMBASSY KABUL
    TO SECSTATE WASHDC 3271

` `

    C O N F I D E N T I A L KABUL 003714

    C O R R E C T E D COPY (TEXT)

    NOFORN
    SIPDIS

    DEPT FOR S/SRAP AND SCA/A

    E.O. 12958: DECL: 11/18/2019
    TAGS: ECON PGOV PREL EAID AF
    SUBJECT: (C) AFGHAN COMMERCE MINISTER DISCUSSES REFORM AGENDA

    Classified by Coordinating Director for Development and Economic
    Affairs Ambassador E. Anthony Wayne for reasons 1.4 (b) and (d).

    ¶1. (C//NF) SUMMARY: Reform-minded Afghan Commerce Minister Shahrani,
    who hopes for U.S. support to keep a ministerial job, argued on
    November 15 that President Karzai is under heavy pressure from Afghan
    politicians to accept less than ideal ministers and urged that the US
    and other donors talk not only to Karzai but also to those
    politicians to stress the importance of approving a good slate.
    Sharani also shared his view of reforms needed in the new government,
    insights into fighting corruption, views on the importance of getting
    sub-national governance right, and the need for the government and
    donors to agree on specific performance benchmarks tied to aid
    delivery.  End Summary.

    ¶2. (C//NF) Afghan Commerce Minister Shahrani told Coordinating
    Director for Development and Economic Affairs Wayne on November 15
    that President Karzai is under great pressure from political leaders
    to accept a number of ministerial candidates whose technical skills
    are lacking.  He specifically cited pressure from ex-warlord General
    Dostum, from ex-jihadist Professor Sayyaf and Hazara leader Mohaqqeq.
    Shahrani, who wants U.S. support to stay on in the cabinet,
    expressed concern that Karzai would not resist the pressure for
    political payback on his own, and urged the U.S. and other donors to
    communicate directly with these political groupings to indicate that
    if a weak or corrupt set of ministers was put in place then the U.S.
    and others would be forced to withdraw their support. He argued that
    these political leaders are only thinking of dividing up the spoils
    rather than the quality of government needed to tackle Afghanistan's
    problems.  Shahrani repeatedly argued that the next five years are
    essential for Afghanistan and the first months of the new Karzai
    administration are key to getting the right reforms in place to
    really bring about positive change in the years ahead.  Afghanistan
    needs the U.S. and other donors to have a chance for real progress,
    he said.  He urged that the U.S. speak frankly in private to Karzai
    as well as key Afghan political leaders.

    ¶3. (SBU) Shahrani argued that it is essential that the U.S. and other
    international donors get as many specific commitments as possible
    from Karzai, in the inaugural speech if possible and subsequently
    then in some sort of joint document between donors and Afghanistan.
    A key step is to press for the President to be clear on basic
    commitments in his inaugural speech, especially about good governance
    and fighting corruption.  Shahrani said he hoped the President would
    approve up to ten key areas for reform in the first year of his
    administration. He and Finance Minister Zakhilwal agree, according to
    Sharani, that the reform areas should be in areas where the
    population will see a difference in delivery of services.

    ¶4. (C//NF) Shahrani underscored the need for very good ministerial
    and gubernatorial appointments and the concomitant reform of
    government organizations.  He said that he and other reform-minded
    ministers still believe they have Karzai's support to name lead
    ministers for five key clusters: 1) finance, economy and commerce; 2)
    agriculture and rural Development; 3) human development (education
    and health); 4) security; and 5) justice/rule of law. Cleaning up the
    last sector will be essential, he argued, especially given the degree
    of corruption currently in the Attorney General's ministry and the
    judicial system.  If this does not happen, it will be very hard to
    address corruption in the rest of the government.  Similarly, the
    executive office of the President needs serious reorganization so the
    President gets a good and balanced flow of information and advice and
    so that ministerial coordination and cabinet decision-making can be
    significantly enhanced, Sharani said. (Note: This is a complaint we
    have heard from a wide variety of sources, from donor nations to
    Palace insiders.  End note.)

    ¶5. (C//NF) Turning to corruption more broadly, Shahrani argued that
    State-owned enterprises need to be turned into independent commercial
    entities rapidly (on the way to privatization), as they are great
    sources of corruption.  Shahrani also singled out the Transportation
    Ministry as a hot bed of corruption, especially its airport
    operations and its "private enterprise group."  Finance Minister
    Zakhilwal had recently broken up a corruption ring at Kabul Airport,
    but the private sector group is an even bigger problem.  This unit
    includes people who collect fees on trucks traveling in Afghanistan.
    Estimates are that about $200 million are collected yearly but only
    $30 million are turned over to the government, he said.  Individuals
    pay up to $250,000 for the post heading this office in Herat, for
    example, and end up owning beautiful mansions as well as making
    lucrative political donations.  This ministry should be a top target
    for cleaning up in the new regime.

    ¶6. (SBU) In his November 15 conversation with Ambassador Wayne,
    Shahrani said, 14 of Afghanistan's governors have been identified by
    Local Governance minister Popal as bad performers and/or corrupt.
    These 14 should be fired, and the new government should implement
    procedures for selecting governors based on merit and for reviewing
    performance on a yearly basis.  Such a performance review process
    should be put in place for all top officials. There must also be a
    greater focus on improving service delivery at the provincial level,
    he argued.  Governors should be given more substantial operational
    budgets as well as placed under more rigorous auditing controls.  The
    big municipalities also need careful attention, first in good mayoral
    appointments and then in greatly improved management, tax collection
    and service delivery.

    ¶7. (C//NF) Turning to international assistance, Shahrani argued that
    donors should tie additional aid to clear benchmarks and timelines.
    This should be publically announced as part of a broader agreement,
    and donors should be tough in demanding agreed performance benchmarks
    before distributing additional assistance.  Such an agreement should
    call for some overarching commitments, with each ministry receiving
    aid committed to achieving its own set of benchmarks in consultations
    with donors.  There should be focus on improving delivery of services
    to the population and mechanisms should be put in place to measure
    success.  Shahrani suggested that the action plans for ministries
    should have three to four year time horizons.

    ¶8. (C//NF) Comment: Minister Shahrani is working closely with the
    Ministers of Finance, Agriculture, Education and local government to
    encourage bold reform moves by the new Karzai administration.  While
    some of the specific ideas he shared may be his own, they are
    consistent with what other reform-minded ministers have been saying
    and urging. Shahrani clearly hopes for U.S. support in keeping a
    cabinet position.  He has been a good partner on a range of
    commercial and economic issues and an energetic proponent of reaching
    a trade agreement with Pakistan.  He has also gone out of his way to
    help on bilateral issues such as finalizing arrangements for U.S.
    Consulate leases.

    EIKENBERRY

`