Financial Times, February 3, 2004

Washington D.C. -- President George W. Bush has asked Congress for more than $5.7bn to provide economic, security and military assistance to countries supporting the US war on terrorism.

"The major recipients of this assistance will be Afghanistan, Pakistan, Egypt and Jordan. If you add the numbers up these countries get a huge chunk of the money," said a senior State Department official.

Several of these countries, which have long been recipients of US aid, have poor records of governance and observance of human rights. They continue to receive aid despite Mr Bush's statement in October setting out a "forward strategy of freedom in the Middle East" and condemning previous western support of authoritarian regimes in the region as part of the Cold War.

The additional funds will come as a relief to Pakistan's president Pervez Musharraf, one of Washington's most important strategic allies, after recent revelations about the country's role in exporting sensitive nuclear technology.

This week, Pakistan officials admitted that Abdul Qadeer Khan, the creator of the country's atom bomb, had assisted Iran, Libya and North Korea in developing nuclear weapons programmes.

The president's proposals form part of a wider $2,400bn election-year budget submitted to Congress this week that also projected a record deficit of $521bn in the current fiscal year.

The additional budget does not include funding for the US's military operations in Afghanistan or Iraq. Officials said it was too early to assess the security situation throughout the year. To cover this spending, the administration is expected to submit another supplemental budget of between $30bn and $50bn.

In Afghanistan, where the US overthrew the Taliban regime and is still searching for al-Qaeda operatives, $1.2bn is to be spent on reconstruction, security and fostering democracy.

US efforts will focus on the rehabilitation and construction of an extra 275 schools and 150 health clinics as well on the training and equipping of 15 army battalions.

The Kabul-Kandahar highway will also be extended to the city of Herat, linking three of Afghanistan's largest cities.

US spending in Afghanistan, however, is dwarfed by the reconstruction plans for Iraq. This year, the US will spend $21bn on rebuilding and humanitarian assistance in Iraq. These funds have already been provided for in last year's supplemental budget.

To help poor countries develop their economies, Mr Bush announced last year the establishment of a Millennium Challenge Account and has proposed $2.5bn for it in 2005, compared with $1bn in 2004.

An additional $50m is included to pay the US share of projected costs for UN peacekeeping missions in Europe, the Middle East and Asia.