KABUL, May 19: President Hamid Karzai has threatened to step down if Afghanistan’s border provinces failed to hand over customs duties estimated to be worth millions of dollars to the cash-strapped central government.

In a speech broadcast on television on Sunday night, President Karzai said that if within the next two or three months Afghanistan’s revenue and administration had not improved, he would call a loya jirga, or traditional tribal council, which elected him last year and quit.

“I will again ask to hold the loya jirga and I will explain to them that your government could not work and will also give the reason why this didn’t work ... until the Afghan nation once again decides in the loya jirga and brings in another government, and that government leads the country toward betterment,” he said.

“Every day the people of Afghanistan lose hope and trust in the government, every day new questions rise in their minds and these questions and hopelessness should change to hopes and success,” he said.

Mr Karzai summoned the governors of 12 border provinces to Kabul for a meeting Tuesday to demand that they hand over all of their customs duty revenue to the central government, which he said was broke.

The president said some provinces were wealthy from duty on trade with neighbouring countries, while the treasury lay bare and the majority of Afghans lived in poverty.

“Some weeks ago the ministry of finance reported that in the government coffers there isn’t a single penny, while (some) provinces have hundreds of millions of dollars from customs,” Karzai said.

“The other ... provinces of Afghanistan are living in poverty, the central government does not have the money for the salary of the soldiers, police have not received their salaries,” Karzai said.

“The question is that with continuation of this situation, is it possible to have peace? Of course not.”

The governors of Herat province in the west and Kandahar in the south allegedly earn millions of dollars from customs duty on trade with Iran and Pakistan respectively. Little, if any, of the money is handed over to Kabul.

Karzai said that from now on all customs duties should be paid to the central government, which would then redistribute it among the provinces.

“Every single penny of that income belongs to the people of Afghanistan, and without any excuse, reason or delay should be given for the central budget.”

Citing estimates by foreign banks, neighbouring countries and traders, Karzai said the war-shattered nation could earn more than 600 million dollars a year from customs duty and other incomes.

Afghanistan’s working budget for the 2003-2004 financial year is 550 million dollars, of which the international community will supply 350 million dollars, leaving the country to find the other 200 million.

Karzai has been trying to extend the authority of the central government to the provinces, where warlords hold sway. —AFP