US embassy cable - 03KABUL303

C O N F I D E N T I A L KABUL 000303 
 
SIPDIS 
 
DEPT FOR SA/PAB, SA/AR-AMB JOHNSON 
NSC FOR ZKHALILZAD, JDWORKEN, HMANN, RHANSON, DSEDNEY 
PACOM FOR POLAD 
CENTCOM FOR POLAD 
 
E.O. 12958: DECL: 02/05/2013 
TAGS: ECON, EFIN, EAID, PREL, AF, IMF, IBRD 
SUBJECT: NO LONGER IN ARREARS, AFGHANISTAN HAS BUDGET 
ISSUES TO TACKLE, SAYS GHANI 
 
REF: STATE 032463 (NOTAL) 
 
Classified By: Ambassador Robert P. Finn for reasons 1.5 (b) 
and (d). 
 
1.  (C) In a chance meeting with the Ambassador and Security 
Coordinator MG Karl Eikenberry at the presidential palace on 
February 4, a clearly pleased Finance Minister Ashraf Ghani 
noted that Japan had come through with pledged funding the 
day before.  As a result, Afghanistan was no longer in 
arrears to the IFIs.  Canada was following through with 
pledged funding as well, said Ghani, who asked the Ambassador 
to pass his thanks on to Under Secretary Larson and Treasury 
Under Secretary John Taylor for their efforts on this issue. 
 
2.  (C) Ghani said the defense budget would require intensive 
work in the coming days.  He had made some progress with the 
Defense Ministry on projected army size, and planned to 
impose a sliding scale on the defense budget, with 
progressively smaller amounts budgeted for salaries each year 
until attrition reduced the total army size to a target 
level.  Besides dealing with the defense budget, reducing the 
total number of government ministries also was an imperative, 
Ghani said. 
 
3.  (C) Noting another step forward, Ghani said the Finance 
Ministry had received 2 million USD in customs revenues from 
Herat province.  This is in addition to 2 million USD Herat 
gave the center last fall. 
FINN