Kabul, 14 December 2011–The Government of Afghanistan and UNDP signed a Letter of Intent today as a major step towards 'on-budget' support for UNDP-funded programmes.

"This signing between the Ministry of Finance and UNDP is very significant because it further strengthens national ownership at this critical time. We greatly welcome UNDP's continued commitment to Afghan development," said Finance Minister Dr. Omar Zakhilwal, at the signing ceremony held in the Ministry.

"UNDP will continue to work alongside the Government, donors and other partners to ensure Afghanistan meets its development goals. Today's signing shows our commitment to the Afghan people," said visiting UN Assistant Secretary-General and UNDP Assistant Administrator, and also UNDP Regional Director for Asia and the Pacific, Ajay Chhibber.

The Letter of Intent further consolidates the process that UNDP has initiated in Afghanistan to strengthen national leadership and capacity development in the management of international assistance. It is also in line with the Government's request that donors adopt an 'on-budget' support mechanism, which was endorsed at last year's Kabul Conference and Peace Process.

'On-budget support' of UNDP technical assistance will be based on the existing experience of the Government and UNDP through the Law and Order Trust Fund (LOTFA). Currently, all budgetary resources under LOTFA have been provided by UNDP through 'on-budget' support and today's agreement will enable the financing of additional projects under national implementation or under Letters of Agreement of directly implemented projects through the treasury.

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