needs an economy - Washington Times Opinion Page
January 9, 2003
Ritter and Mahmood Karzai
Security and the economy for Afghanistan are mutually interdependent.
You can't have one without the other. And while both have a long
way to go, building the economy now will provide jobs and give people
hope. Hope, in spite of poverty. That's security.
A delegation of Afghan American businessmen and women, U.S. Chamber
of Commerce and Center for International Private Enterprise leaders
recently returned from Afghanistan. In the midst of devastation
in Kabul, we launched the Afghan American Chamber of Commerce (AACC)
to the enthusiasm of the Afghan business community. At the first
workshop, some 100 Afghan businessmen attended and unloaded mouthfuls
of obstacles they face.
A group of market-oriented stalwarts in Afghanistan want the small
but growing private sector nurtured despite an economic climate
left over from the Taliban, fourteen years of communism and before
that, a monarchy-dominated economy. The momentum of this stifling
past is great and successful business is still very much based on
favoritism. Competition as we know it has yet to arrive with the
exception of small merchants, vendors and shopkeepers.
It is difficult to talk about economic policy in Afghanistan when
there is so much poverty, deprivation and destruction, but like
Germany after the war, good thinking in the present can have positive
results for the future. Jobs and the dignity of work for the Afghan
people should be the legacy. And there no time to waste.
President Hamid Karzai, Finance Minister Ashraf Ghani, Commerce
Minister Kazemi and Afghanistan's Ambassador to the United States,
businessman Isaac Shariyar, are committed to prosperity and security
though an economy of level playing fields, open markets, competition,
property rights and transparency. Given a world of heavily armed
militias and others who have never seen a modern business, cratered
or non-existent roads, minimal electricity and irrigation, the Afghan
people have a big task ahead.
Help is on the way from the highly educated and successful worldwide
Afghan diaspora, like the men and women in our delegation. Thousands
are bringing their business skills, capital and dedication to the
new economy in Afghanistan. They know the lay of the land. They
will take risks that non-Afghans wouldn't. They are also guiding
foreign investors into the new economy. The Intercontinental Hotel
where we stayed was an 18-hour day beehive of activity with Afghans
and non-Afghans discussing business deals.
A caution. Big money coming in for big projects, resulting in important
infrastructure can also have the unintended effect of crowding out
emerging small and mid-size enterprises responsible for long term
and widespread job and wealth creation. The United Nations, World
Bank, U.S. AID, donor nations and foreign NGOs with their relatively
astronomical salaries and operational costs driving up the price
of labor, rents, materials and services, create a bubble economy
in the short term where private Afghan firms can't compete. Way
too many expensive newcomer consultants are engaged when the pool
of competent, more cost-effective diaspora Afghans is bypassed.
Plus, when the big project bubble is gone, look out.
The AACC is proposing a dialogue with the Afghan business community,
key members of the Karzai administration and the U.S. government
to find solutions to this potentially dangerous effect. One positive
example is the U.S.Army asking for local Afghan content in the outfitting
of the 70,000- man Afghan national army. Plus, Afghan leaders would
like to see a U.S. government "point person" to work with
issues of business and economic development like the State Department
has done both here and in Afghanistan for overall reconstruction.
Right now, there are too many involved with too few in authority.
Non-mega-project capital is very scarce. And while Congress has
authorized a $300 million Enterprise Development Fund to lend to
private business in Afghanistan, there is the view that Afghanistan
is not sufficiently stable to warrant an actual appropriation of
those funds. Yet it is just such a commitment that will promote
security. Economy and security is a proverbial chicken and egg scenario.
The U.S. government, perhaps in conjunction with the international
arm of the U.S. Chamber, the AACC and others can take the lead in
pushing private enterprise in Afghanistan. That will help bring
security long after our troops are gone.
Former Rep. Don Ritter is Chairman of
the Afghanistan America Foundation and Mahmood Karzai is an Afghan
American businessman in the U.S. Both are founding members of the
Afghan American Chamber of Commerce.