Afghan Threat

Contractors threaten to ‘blow up’ compound over unpaid fees

Afghanistan construction / AP
June 21, 2013

Afghan contractors working on U.S.-funded reconstruction projects in the war-torn country have threatened to "blow up a compound of U.S. contractors and government agencies" over their failure to pay some $69 million in fees, according to the Special Inspector General for Afghanistan Reconstruction (SIGAR).

At least 52 American contractors have failed to pay these Afghan sub-contractors $69 million for various works projects, leading to threats of violence and worse, SIGAR found.

Another unpaid "subcontractor threatened to set himself on fire in front of the U.S. embassy in protest of nonpayment," SIGAR reported on Monday in an "alert letter" sent to the State Department and Pentagon outlining the situation.

Prime contractors, which are mostly American and funded by the U.S. government, farm out various reconstruction projects to local Afghan builders and workers. The joint projects are meant to foster cooperation and trust between the U.S. and Afghan people.

However, "‘prime contractors' failure to pay is often viewed by Afghan subcontractors as a failure on the part of the U.S. government," SIGAR reported after conducting a years-long investigation.

"The information that SIGAR has received suggests that there is a serious problem in Afghanistan related to disputes regarding the payment of Afghan subcontractors by prime contractors," the oversight group said in its letter.

"SIGAR has received testimonial and documentary evidence from credible sources alleging death threats, work stoppages, and strikes in connection with allegations of nonpayment of subcontractors, as well as allegations of questionable intervention by the Afghan Attorney General’s Office," it wrote.

The failure to pay Afghan contractors has created a massive rift between the U.S. government and Afghan people as American troops gear up to leave the country for good.

Losses from non-payment have the collateral effect of eroding support for U.S. and coalition forces and costing the U.S. time and money, SIGAR said in its letter, which was sent to Secretary of State John Kerry and Secretary of Defense Chuck Hagel, among other high-level officials.

"Nearly a quarter of SIGAR’s hotline complaints from 2009 through October 2012 have been related to Afghan prime contractor and subcontractor nonpayment issues," the letter stated.

The government does not closely watch U.S.-funded contractors, meaning that they often can get away with not paying Afghan subcontractors.

It is unclear what exactly the prime contractors have done with the $69 million they failed to pay out.

Afghan contractors suffer from a lack of legal protection and have few avenues to compel these contractors to make good on their debts.

SIGAR urged the Department of Defense and the State Department to remedy the problem by "more aggressively [overseeing] these contractors and [helping] ensure that Afghanistan subcontractors receive prompt payment for their work."