• 10 mins Kuwait Greenlights Game-Changing Gas Fields Project After Years of Delay
  • 40 mins Minnesota Begins Public Hearings On Enbridge Line 3 Project
  • 1 hour China Looks To Create National Natural Gas Pipeline Firm
  • 2 hours Total Not In A Rush To Sell Canadian Oil Sands Assets
  • 2 hours DOE Seeks To Boost Usage Of Carbon Capture Tech
  • 3 hours Taxpayers Likely To Pick Up The Growing Tab For DAPL Protests
  • 6 hours WTI At 7-Month High On Supply Optimism, Kurdistan Referendum
  • 12 hours Permian Still Holds 60-70 Billion Barrels Of Recoverable Oil
  • 17 hours Petrobras Creditors Agree To $6.22 Billion Debt Swap
  • 21 hours Cracks Emerge In OPEC-Russia Oil Output Cut Pact
  • 1 day Iran Calls On OPEC To Sway Libya, Nigeria To Join Cut
  • 1 day Chevron To Invest $4B In Permian Production
  • 1 day U.S.-Backed Forces Retake Syrian Conoco Gas Plant From ISIS
  • 1 day Iraq Says Shell May Not Quit Majnoon Oilfield
  • 4 days Nigerian Oil Output Below 1.8 Million BPD Quota
  • 4 days Colorado Landfills Contain Radioactive Substances From Oil Sector
  • 4 days Phillips 66 Partners To Buy Phillips 66 Assets In $2.4B Deal
  • 4 days Japan Court Slams Tepco With Fukushima Damages Bill
  • 4 days Oil Spills From Pipeline After Syria Army Retakes Oil Field From ISIS
  • 4 days Total Joins Chevron In Gulf Of Mexico Development
  • 4 days Goldman Chief Urges Riyadh To Get Vision 2030 Going
  • 4 days OPEC Talks End Without Recommendation On Output Cut Extension
  • 5 days Jamaican Refinery Expansion Stalls Due To Venezuela’s Financial Woes
  • 5 days India In Talks to Acquire 20 Percent Of UAE Oilfield
  • 5 days The Real Cause Of Peak Gasoline Demand
  • 5 days Hundreds Of Vertical Oil Wells Damaged By Horizontal Fracking
  • 5 days Oil Exempt In Fresh Sanctions On North Korea
  • 5 days Sudan, South Sudan Sign Deal To Boost Oil Output
  • 5 days Peruvian Villagers Shut Down 50 Oil Wells In Protest
  • 5 days Bay Area Sues Big Oil For Billions
  • 6 days Lukoil Looks To Sell Italian Refinery As Crimea Sanctions Intensify
  • 6 days Kurdistan’s Biggest Source Of Oil Funds
  • 6 days Oil Prices On Track For Largest Q3 Gain Since 2004
  • 6 days Reliance Plans To Boost Capacity Of World’s Biggest Oil Refinery
  • 6 days Saudi Aramco May Unveil Financials In Early 2018
  • 6 days Has The EIA Been Overestimating Oil Production?
  • 6 days Taiwan Cuts Off Fossil Fuels To North Korea
  • 6 days Clash In Oil-Rich South Sudan Region Kills At Least 25
  • 6 days Lebanon Passes Oil Taxation Law Ahead Of First Licensing Auction
  • 7 days India’s Oil Majors To Lift Borrowing To Cover Dividends, Capex
Alt Text

The Kurdish Referendum Could Reshape Oil Markets

The Kurdish referendum for independence…

Alt Text

OPEC’s No. 2 Faces Civil War Threat

Just as the threat of…

Alt Text

Will The White House Prevent Rosneft From Buying Citgo?

The potential Rosneft purchase of…

Will Afghanistan’s $1 Trillion of Minerals Secure Foreign Investment

In mid-June, an article in the New York Times revealed to the world something that many Afghans already knew: Afghanistan sits on about $1 trillion-worth of minerals.

Afghans are now hoping the news will help the government attract much-needed foreign investment.

On July 20, the Afghan government will host the first International Conference on Afghanistan in Kabul. At the conference, Afghan officials intend to outline a national development strategy to international participants, including regional and international bankers and private-sector representatives. The government's development strategy is organized around five clusters. Economic growth is one such cluster, focusing on poverty reduction, job creation, and sustainable development.

The key to achieving each of the above objectives is the extraction and export of Afghanistan's natural resources to global markets. This would be the fastest way to earn the revenue the country needs in order to fuel long-term economic growth. The list of known mineral deposits in Afghanistan is a long one, including copper, iron, chromium, magnesium, rubies, emeralds, lapis lazuli, nickel, mercury, gold, silver, lithium, and uranium

At the conference, Afghanistan's ministers of finance and mines are expected to outline their reform agendas, featuring measures to promote mutual accountability and transparency. The reforms will aim to enhance aid effectiveness and foster a friendly and safe environment for capital investment.

Afghanistan's Ministry of Mines and Industries hosted an exhibition in London on June 25 to promote investment opportunities, as well as answer questions about the country's legal framework covering the development of natural resources. Minister of Mines and Industries Wahidullah Shahrani noted that investment in Afghanistan's mineral sector would entail work in developing Afghanistan's transportation infrastructure. Such projects would be needed to get extracted minerals to international markets. But they would also serve as an important job-creation mechanism.

In a recent interview with the British Broadcasting Corp., Minister Shahrani sought to address concerns that a massive influx of investment in Afghan minerals could lead to increased corruption. "We have improved our legislation, the procedures have been upgraded and we have been getting a tremendous amount of support from our international partners," he said.

"Whatever contracts would be awarded, all the information will be published, to make sure that all the relevant stakeholders, civil society and media and parliament, will have access to the information; to make sure we will have sufficient amount of the safeguards; to make sure that we will achieve the high standards of transparency," Shahrani said.

Bureaucratic bottlenecks have been known to impede the conduct of business in Afghanistan. In addition, there are security issues related to the ongoing insurgency carried out by Islamic militants. Nevertheless, investors in Afghanistan enjoy some advantages not found elsewhere in the region. Domestic and foreign corporations, for example, do not have to compete with subsidized government-owned businesses. In addition, the Afghan Investment Support Agency (AISA) serves investors as a one-stop shop for licensing and corporate support.

Foreign investment that spurs job creation could prove a powerful weapon in the effort to defeat the radical Islamic insurgency. Under the existing conditions of economic stress and uncertainty, some Afghans have inevitably turned to the Taliban for wages and some have joined factional militias merely for food and shelter. Still others engage in opium poppy cultivation to ensure the survival of their families.

Those opting to become insurgents and poppy growers comprise less than 15 percent of the Afghan population.  It would be possible to win a significant percentage of these people over to the government side, if officials could offer them decent jobs. And for the roughly 85 percent of Afghans who already support the government, as well as approve of the international troop presence, foreign investment and job creation would go a long way toward reinforcing their faith in the reconstruction process.

Already, some countries have recognized the lucrative opportunities that are available in Afghanistan. For example, India has invested $1.3 billion in transportation, healthcare, education, hydro-electricity and electrical transmission. And China has won a $3.5-billion bid to develop Afghanistan's giant Aynak copper mine.

The government and people of Afghanistan see the country's abundant mineral wealth as a way to secure and rebuild their war-ravaged homeland. Afghans are proud of a historical tradition of commerce and cultural exchange that dates back to the era of the Silk Road. With each economic opportunity that is fulfilled, the people of Afghanistan could move one step closer to reconnecting with the global economy and securing a stable and prosperous future. Foreign investors can play a major role in helping us fulfill this national destiny.

By. Ashraf Haidari

Back to homepage

Leave a comment
  • Philip Andrews on May 10 2012 said:
    "Those opting to become insurgents and poppy growers comprise less than 15 percent of the Afghan population. It would be possible to win a significant percentage of these people over to the government side, if officials could offer them decent jobs. And for the roughly 85 percent of Afghans who already support the government, as well as approve of the international troop presence, foreign investment and job creation would go a long way toward reinforcing their faith in the reconstruction process."

    Souinds like the author is either living in cloud cuckoo land or is hugely overoptimistic about the situation out there. Or he's practising the Western talent for overselling the unsaleable.

    I'd like to know where he gets his 'only 15%' are either insurgents or poppy growers' and '85% support the government'.

    Chances are that that $1 trillion dollars will remain in the ground. Afghanistan is about WHO owns the place; the Taliban and the Pashtuns seem to own the East and South, and a mixture of Russian supported and Iranian supported tribes seem to own the West and North. And the 'government' owns Kabul...

    Not very promising circumstances for either the TAPI pipeline or exploiting $1 trillion worth of minerals.

    Oh the so called ANA it seems is primarily made up of Uzbeks and Tajiks (according to a former British ambassador to Kabul who got his wrists slapped for speaking his mind...)so there is an incipient state of civil war already existing between the ANA and the Pashtun/Taliban and their associates. The Pashtun as a tribe on both sides of the border number 40 million. Afghanistan has a population of about 30 million.

    The numbers are interesting but I don't see where the author's 15% and 85% fit into this...

    As for 85% 'approving' an international troop presence... Get real man!

Leave a comment

Oilprice - The No. 1 Source for Oil & Energy News