A coalition of local and international NGOs in Afghanistan have issued a negative report on the foreign aid effort so far. The two major complaints were that donors hadn't given as much as they promised ($15 billion has been obligated on $25 billion in promises) and that too much of the money has been spent through contractors – meaning that not enough actually made it through to Afghans.
These are probably reasonable complaints, but I think is important to point out some of the potential biases in the report. First, it was written by someone who works for an international NGO – Oxfam, and published by a group of NGOs. More aid money means more money for their work. Further, more money to contractors means less money to NGOs.
The report points out that 40% of the foreign obligated to Afghanistan goes back to the donor countries either in the form of indirect costs and profit (money that just stays at HQ) or as salary and benefits to international staff. Afghans are entitled to resent that figure, but I’d be impressed if they kept it to that. Indirect cost rates (which are not technically profit, because they support actual expenses incurred to run the type of organization that can implement an aid project) run between 15% and 30%, depending on the organization. Add to that the costs of running an office or offices in Afghanistan, paying a country director, buying plane tickets to get that person to Afghanistan, and paying for their housing (which are direct, program costs, even if they don't seem like it) all add up pretty quickly. Again, I think that people in Afghanistan have a right to resent this, but it isn't unique to profit-making contractors – international NGOs charge for these too. It's sad, but international development projects just cost a lot of money.
As for the amount pledged versus actually obligated, donors have a habit of attending big conferences and pledging a lot of money that never materializes. I understand why they do it, but I’ve never known why the press is willing to be their enabler and print the promises. It's good to see the media covering this one, at least.
