The prolonged economic crisis in Afghanistan has made it clear that the current approach to humanitarian aid in the country is unsustainable. Humanitarian aid focused solely on short-term emergencies, such as natural disasters, is not well-positioned to respond to a long-term economic crisis. In this regard, experts have proposed a new approach that incorporates macroeconomic and sustainability perspectives and focuses on practicing risk management and “doing no harm.”
Using Afghan Private Sector for Sustainable Aid Delivery
To make aid delivery more sustainable, experts recommend utilizing the Afghan private sector to exploit new technologies and aid delivery mechanisms. In turn, procurement and contracting with the private sector should be prioritized by aid agencies. This move can help reduce costs and provide an economic boost in Afghanistan.
Incorporating Macroeconomic Modeling and Forecasting for Effective Aid Delivery
The size and economic impacts of humanitarian aid must be incorporated in macroeconomic modeling and forecasting, which will then feed back into the planning and deployment of aid. In this way, aid organizations should program their assistance to help maintain macroeconomic stability to minimize further damage to the Afghan economy. A predictable, steady, and gradual reduction in total aid over the next three to five years will give the Afghan economy more time to adjust to lower levels of assistance.
Cash Shipments Solution can Address Challenges
Despite its benefits, UN humanitarian cash shipments are costly, risky, and problematic. Moreover, Taliban reap economic benefits from inflows of cash dollars. As such, aid organizations should develop other mechanisms for taking up some of the slack to enable UN shipments of cash dollars to decline faster than total aid. The use of emoney innovations can be a promising way to transfer aid funds in Afghanistan. Major donors need to allocate sizable funds to scale up emoney transfers while safeguards are put in place to minimize the risk of diversion of aid to Taliban (addressing AML/CFT concerns).
Focusing on Efficiency for Aid Allocation
A comparative assessment of different aid modalities and delivery mechanisms is needed to ensure the efficient use of humanitarian aid in Afghanistan. Cost-effectiveness and use of cost-benefit criteria should be prioritized in allocating aid. There is a need to minimize the adverse side effects of large-scale, prolonged humanitarian aid; specifically, fungibility of funds and the risk of aid replacing Afghan government spending, benefiting the Taliban. In this regard, the focus is shifting towards providing more aid in cash rather than in-kind aid or non-cash contributions.
The Risk of Famine and Proposal for Changing the Approach towards Helping Afghanistan
The United Nations World Food Program (WFP) warns that it may have to cut assistance to 9 million people in Afghanistan if it does not immediately receive funding. Despite multibillion-dollar aid packages in the past 20 months that prevented a widespread famine, donors have reduced funding this year, rekindling fears of a famine. With the Taliban’s ban on women working for NGOs and emergencies in other countries, global economic conditions could lead to a drop in donor funding for Afghanistan.
To address these issues, experts propose coordinating aid efforts and utilizing Afghan Trust Fund in Switzerland while gradually lessening humanitarian aid while increasing stability for the Afghan economy. Empowering the Afghan private sector is crucial since there are 360 NGOs operating in Afghanistan with the majority engaged in providing humanitarian aid. Unfortunately, banning women from working at NGOs reduces humanitarian aid; hence there is a need to explore ways to use Afghan central bank reserves in the Afghan Fund in Switzerland to strengthen balance of payments and support the private sector without directing funds to the Taliban regime.
In conclusion, a new approach to delivering international aid needs to be adopted for sustainable development, efficient allocation, effective delivery, macroeconomic stability maintenance with risk management practices that also focuses on doing no harm. The current needs and challenges in Afghanistan, such as the risk of famine, require a combined effort to achieve positive changes in aid delivery across multiple nations and organizations.
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