The US troop surge in Afghanistan has come to an end. And while there’s much debate about whether or not this is something to truly celebrate, especially given the heavy troop presence that will remain in the war torn nation, some of the discussion has now shifted to Afghanistan’s future without the United States and NATO.
Though security will be the most important element in defining Afghanistan’s future, economic development is not far behind–if not directly intertwined.
Many political experts, citing various reports, have brought up the country’s vast natural resources and the possibility of developing a lucrative mining industry in Afghanistan.
According to a recent article in the NY Times:
“— If there is a road to a happy ending in Afghanistan, much of the path may run underground: in the trillion-dollar reservoir of natural resources — oil, gold, iron ore, copper, lithium and other minerals — that has brought hopes of a more self-sufficient country, if only the wealth can be wrested from blood-soaked soil.”
Aside from the ethnic conflict that is likely to ensue if any such potential to make a large sum of money comes to fruition, there are other factors that should be considered when it comes to determining whether or not developing this industry would even be possible.
Several reports, including from the World Bank, have validated that Afghanistan does have good quality resources. Not only ‘steel quality coal,’ but precious and semi-precious stones such as rubies, emeralds, and lapis were also found.
U.S. Government contracting consultant and adviser Jeffrey Shaw was responsible for setting up a company between 2002-2004 that was intended to help the Afghans develop a mining industry.
But the barriers proved to be too much and the proposed company’s file was closed in 2006.
According to Shaw there is very little to no “government”-level commitment to the process,
There are no roads or power or any reasonable infrastructure to exploit the resources. The returns would have to be substantial before private investors commit the capital to such infrastructure creation. An additional barrier is the sheer corruption of the Afghan society and the Karzai government. As a case in point, the Government of Canada had allocated a couple hundred million dollars to the construction of a power generating dam project [in 2005]. After it was announced, one of the Karzai brothers bought up all of the land surrounding the dam and the site itself, so that the Canadians would have to buy it back from him (at many multiples of price) before the dam could be built. The project was dropped, but this is typical of what any development project is dealing with and it is not just the Karzai family, it is every tribal leader at any corner of the society.
Shaw advises the United States not to consider investing in Afghanistan in this way; however, China is already looking for ways to reap the benefits from this potential opportunity.
They [CHINA] will take complete control of what they acquire in Afghanistan and they will make the rules for the locals to live by, or the locals will not be allowed to play. The chiefs will be paid to keep the people in line and the Chinese will start digging. End of story. They have none of the “nation-building” illusions that the West feels the need to play by, but they do recognize the value of the raw material.
Shaw, like others who understand the inner workings of the Afghan government and society, say that China will step in with their own workers, pay the Afghans off by buying the land and mineral rights from them, and leave behind money for the tribal elders but no actual industry that could potentially help Afghanistan’s economy in the long term.
Steve LeVine, a Schwartz Fellow at the New America Foundation and Washington correspondent for Quartz, also believes that if China were to try to take advantage of these resources in Afghanistan, it would be a short-term vs. a long-term investment.
“From two decades of watching and covering the country, I feel confident saying that China will not end up dominating Afghanistan…Perhaps its territorial notions will expand over time, but I found no one who suggested that China wishes to play a security role in Afghanistan or Central Asia.”
As far as the main barriers towards developing this industry, Levine says:
I do not think that these resources are driving ethnic conflict. But I do think that already-existing ethnic conflict can be the main force that hinders their development.
Whereas the United States would most likely attempt to create a lasting industry in Afghanistan, China, like other investors, probably realizes that in order to make a substantial profit, it is better to try to do so without any strings attached.