February 10, 2003


business in Afghanistan
(Isobel Coleman, February 9 2003, Financial Times)
If Afghanistan can productively capitalise on international support over the next decade, it has the potential to achieve economic stability and even a role in the world economy. It could regain its status as a 1970s exporter of agricultural products such as fruit, flowers and livestock. It could earn not insignificant economic rents from a long sought after oil pipeline across the country and as a transportation hub linking the Middle East, central Asia and the Indian sub-continent. Rough estimates for that road-tunnel network through the country's mountainous terrain reach as high as $300bn - a huge public works project that international sources would fund only if there were stability in the country and a central government was able to collect tolls.

Opium production and drug trafficking will inevitably be another source of economic activity, but a stable and growing economy should relegate that to the margins. Likewise, it is inevitable that some warlords will replace their paramilitary ambitions with Russian-style mafia empire-building. The Afghans' challenge is to create economic incentives and rule of law to channel that activity into more productive areas such as construction and trade.

In December, Mr Bush signed the Afghan Freedom Support Act authorising $3.3bn in economic, political, humanitarian and security assistance over the next four years. Congress must now follow through and appropriate at least that much for a country that could so easily slide back into chaos. Continuing to track down Taliban troublemakers is necessary, but not sufficient, to ensure Afghanistan's stability.

As Afghanistan was one of the breeding grounds of the fall of the Soviet Union and of the rise of Islamicism, so might it now be a testing ground for a new kind of Middle East, one dedicated to building stability and prosperity against long odds. It's hard to be optimistic about the possibility but seems well worth offering what help we can give. Posted by Orrin Judd at February 10, 2003 8:13 AM
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