The 2004 adoption of a constitution and recent elections, including those for the first parliament in 30 years due to sit this month, were important steps in democratization, it said in a report.

"However they should not be viewed as 'the end of the story'," said the report by the EU mission which observed the September 18 legislative elections. "Several risk factors threaten to undermine democratic development in Afghanistan," it said.

These included widespread corruption, pervasive illegal opium production and "continued lack of security and stability in parts of the country including continued presence of illegal armed groups," it said.

The three were strongly interlinked. "For example, the illegal opium economy funds illegal armed groups and feeds corruption," the report said.

Drugs, violence and a breeding ground for extremism

Afghanistan is estimated to produce more than 80 percent of the world's supply of opium, used to make heroin, despite efforts by the government. It is also plagued by regular attacks by Islamic militants, notably those linked to the extremist Taliban government removed from power in a US-led invasion in late 2001. The violence has killed about 1,500 people this year.

And despite government disarmament programs, several former warlords still run private armies in remote areas which have yet to come under the control of the central government.

The sitting of the new parliament, due on December 19, will mark the end of an internationally planned transition to democracy that was adopted at a conference in Bonn, Germany after the Taliban were routed.

Bonn Process making its mark slowly

The EU report said the main achievements of the Bonn Process included the elections and laying down basic foundations for state structures.

However there were several weaknesses, such as limited international assistance on security, not enough time spent on reconciliation and the fact that civic education had focused largely on voting and not aspects of democracy-building such as national unity and the rule of law.

The report urged the government to include ways to build democracy in its development strategy, including a "Compact for Afghanistan" to be presented to a London conference next month to plan a "post-Bonn" process.

International involvement likely to remain

"Continued international engagement in support of security, economic and social development with focus on social cohesion in addition to local empowerment and public participation are important to underpin a solid democracy-building in Afghanistan," the report said.

A well-functioning democratic system was "a valuable safeguard against a return to Afghanistan's brutal recent past."

The mission said the September 18 elections for the lower house of parliament and provincial councils were an "accomplishment" although there were some shortcomings, including irregularities and fraud.