- Associated Press - Friday, October 22, 2010

KABUL, Afghanistan (AP) — A U.S.-funded program to bolster local governance and community development across Afghanistan said Friday that it will close down before the end of the year if President Hamid Karzai does not modify his ban on private security companies.

The Obama administration is scrambling to avert a crisis over the ban, which could force the cancellation or delay of billions of dollars in reconstruction projects considered vital to counterterrorism efforts. U.S. diplomats are negotiating this weekend with Mr. Karzai and his aides to persuade them to revise the ban.

As it now stands, Mr. Karzai’s decree, set to take effect in December, would bar private security guards, who protect everything from development projects and NATO supply convoys to private houses.

With complaints that they are poorly regulated, reckless and effectively operate outside local law, such operators have become a point of contention between the Afghan government and U.S. and NATO coalition forces and the international community.

“As a matter of priority, we are working with the Afghan government and international community to fully implement the decree,” U.S. Embassy spokeswoman Caitlin Hayden said in a statement issued on Friday. “An area of specific focus is the protection of development implementing partners, recognizing their stated need for clarity in order to safely continue their operations.”

Steven O’Connor, a spokesman for Development Alternatives Inc., a Bethesda, Md.-based organization that runs U.S.-funded projects in Afghanistan, said the group is planning an early shut down of its Local Governance and Community Development Project, which employs more than 800 Afghans in more than 20 of Afghanistan’s 34 provinces.

“We remain hopeful that the decree will be modified, but as it is currently written, we anticipate full demobilization of the project by the end of December,” Mr. O’Connor said. “We hope it doesn’t come to this, but we have contingency plans to wind down all six of the projects DAI operates in Afghanistan.”

A U.S. official in Washington said Thursday that all private and public sector assistance would be hit, not just U.S.-funded projects. The official, who spoke on the condition of anonymity because of the sensitivity of the issue, noted that about 80 percent of British-funded projects could be affected as well.

The Obama administration supports Mr. Karzai’s goal of overhauling the private security industry in Afghanistan. U.S. officials recognize that insecurity has spawned the creation of more than 150 private security outfits — about two-thirds of which are unlicensed and some of which act like private armies.

The administration successfully lobbied Mr. Karzai earlier this year to make exemptions in the ban to cover private security guards working for foreign governments at embassies, other diplomatic outposts and military facilities. But Karzai has refused to extend the exemption.

The State Department said earlier this week that it was pleased with the exemptions but had concerns that people doing aid and reconstruction work would not be able to employ private security guards.

Mr. Karzai said Wednesday he was tired of hearing complaints from embassies about the order, and his decision to shut them down was final.

“We hope that our international friends will not get back to us or try to put pressure on us or talk about it in the media because none of these are going to work,” he said. “These companies are closed — that is it.”

Private security contractors in Afghanistan are subject to Afghan law, unlike the situation that persisted through most of the war in Iraq, where those working for the U.S. military were immune from prosecution by Iraqi authorities.

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