A new report by the European Council on Foreign Relations (ECFR) calls on the European Union and the United States to strike a "grand bargain" and overhaul their Afghanistan strategy to avert failure.

The new strategy, the report says, should include a coordinated political outreach to moderate Taliban insurgents.

The report argues that EU governments' failure to coordinate strategies in Afghanistan has limited the EU's real impact on the US-led stabilisation agenda. "EU countries have treated the common effort in Afghanistan like a pot-luck dinner where every guest is free to bring his own dish," writes Daniel Korski, the report's author, a former UK government official working on post-conflict reconstruction in Afghanistan and Iraq.

The report recommends that the current, military-focused coalition strategy should be replaced with a comprehensive political strategy. It calls for a "grand bargain" between Brussels and Washington in which the EU should deploy more troops in Afghanistan and increase development aid. In exchange, the US should accept a shift from a strategy based on combat operations to one focused on overall political impact and the protection of civilians across the country.

Most EU governments have only made a symbolic contribution to the military effort in Afghanistan, the report says. For example, Austria has contributed three soldiers, Ireland seven, Luxembourg nine, Slovakia 70 and Slovenia 66. Latvia, Cyprus and Malta are the only EU countries not to have any troops in Afghanistan. In contrast the UK has 7,000 troops, Germany 3,155, Italy 2,358, The Netherlands 1,500, France 1,292, Poland 1,142 and Spain 763.

The ECFR reports says the international coalition should include mid-ranking, moderate insurgents in the political process and help President Hamid Karzai to eventually reach a political settlement with his opponents. It encourages the coalition to develop a package of incentives for this endeavour, including a €50 million EU-funded pilot scheme to build local schools and hospitals.

It calls for a new approach to counter-narcotics and to abandon earlier plans for aerial spraying, or schemes for buying up opium crops. Instead, the international coalition should make clear that traffickers and their protectors, not farmers, are the problem. "The emphasis should be placed on arresting and prosecuting drug lords and their backers in government," it says.

Joschka Fischer, former German Foreign Minister and ECFR's co-chair said: "Afghanistan has fallen victim to the scandal and unpopularity of the war in Iraq. To save the country from chaos and total collapse, the international coalition needs to design a new strategy. But this cannot happen unless European Union governments first coordinate their own priorities and development goals."

Martti Ahtisaari, former President of Finland and ECFR's co-chair said: "To turn Nato into an efficient actor in Afghanistan, those EU governments which have so far underperformed need to boost their levels of military engagement. Unless this happens, the EU risks more trouble ahead from the increasing insurgency, and may have to stay for much longer than originally planned."

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