Thursday 1 December 2011

$4 Billion Defence Funding Shortfall

"The Americans have told us that Congress is not prepared to give Afghanistan more military aid than Israel, which means no more than $3bn," a European official said.
The fear that international financial support for Afghanistan will evaporate in 2014 as the west struggles to escape from chronic recession and western capitals seek to put the conflict behind them, has alarmed the Kabul government of Hamid Karzai. Karzai will chair an international conference in Bonn on Monday, designed to seek international commitments to continue to support Afghanistan long after 2014, when the country, after more than three decades of war, will continue to be an economic basket case. A World Bank report last week projected Afghanistan's fiscal deficit by 2021-22 at 25% of the country's GDP.
"Even assuming ambitious targets for robust growth in domestic revenue are met … there will be an unmanageable fiscal gap," the World Bank report said. Link.

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