Economic Assistance in Conflict Zones: Lessons from Afghanistan

The recent announcement that NATO troops would leave Afghanistan in 2014 brings into sharp relief the question of whether that country will be able to find lasting peace and prosperity without a significant foreign military presence. In this policy paper, Ethan Kapstein and Kamna Kathuria examine the issue through the lens of foreign-assistance policy. They argue that donors face a fundamental tension between the short-run demands of financing a war effort and the long-run demands of sustainable economic development and that the search for a resolution to this dilemma is central to understanding how foreign assistance policy is shaped in conflict zones like Afghanistan. The extent to which the foreign aid community has succeeded in helping the government of Afghanistan defeat the Taliban insurgents while preparing the country’s economic future is the central issue that the paper addresses. In short, this paper explores the question of whether or not foreign aid has helped to build state strength and legitimacy in Afghanistan, and not just bolster state capacity to fight a war.