Forty per cent of the Afghan population live below the minimum subsistence level. Every year, one million young people are crowding into the labour market. This generation demands a perspective for their future: professional training, a job and with this the opportunity to earn their own money and maybe start a family. For this reason, an improvement of the economic situation is crucial for their future – and a long-term investment in peace. In recent years, the Afghan government set the course for the economic development of the country with international aid. The main focus is on establishing the capacity required for economic policy geared towards a market-economy in the public and private institutions.
Market with risks and opportunities. Since 2002, Deutsche Gesellschaft für Internationale Zusammenarbeit GmbH (GIZ), has supported the country in the Hindu Kush on behalf of the German government in promoting sustainable economic development, especially for the German Federal Ministry for Economic Cooperation and Development (BMZ), as well as for other national and international customers. The objective: to strengthen private companies in Afghanistan so that they are able to improve the quality of their products, to achieve higher incomes and to create new jobs. In addition, GIZ offers training and educational measures to supply the labour market with qualified specialist staff. The construction of roads and bridges, the establishment of drinking water and energy supply, the training of teachers for elementary and vocational schools, the establishment of civil aviation, the promotion of women and the rule of law also contribute to the economic development of the country.
Today, there is a great demand especially for services for the reconstruction of the infrastructure in Afghanistan. Small industrial centres specialising in this area have already developed in the relatively stable regions in the north and west of the country. About 45 German and German-Afghan enterprises are currently registered in the country. They invest primarily in the construction, energy and infrastructure sectors, but also in medical technology, telecommunications, and consulting. Afghanistan possesses considerable natural resources, including raw materials such as iron, copper, gold, gemstones and marble as well as fruit, nuts, silk, carpets and cashmere wool, for which there is strong global demand. The demand for foreign investments and know-how is considerable, for example in order to explore the enormous natural resources, which might enable the country to achieve a high income level in the long term. In addition, in the course of the reconstruction, demand for building materials, machines and modern technology for generating energy is constantly increasing.
Promoting added value. Currently, exports constitute only four per cent of Afghanistan’s economic output. In comparison, in the 1970s, the country was among the leading suppliers of dried fruit and carpets. This tradition can be revived: in 2010, GIZ trained 120 traders from the northern provinces in sorting and classifying dried fruit, while others learned to work with oil presses. These new skills and a new packing machine for dried fruit and nuts increase the value of these products by nearly 50 per cent. In order to revive the carpet industry, in the year 2010, 600 women in the provinces of Jawzan and Balkh were trained in spinning wool and more than 450 women learned to weave carpets. They all found jobs. In addition, 15 carpet designers in the province Balkh were trained in using modern software to design carpets. This strengthens competitiveness in the international market.
The private sector needs strong institutions and qualified workers. With regard to exports, Afghanistan partially achieved growth rates of more than ten per cent in recent years. The Export Promotion Agency of Afghanistan (EPAA) whose establishment we supported, also contributed to this. By means of market analyses, exhibitions, and marketing, EPAA helps enterprises gain a foothold in new markets in the region, in Europe and in America. And it has worked: in 2011, Afghanistan presented itself at the world’s largest agricultural fair, the International Green Week in Berlin, Germany. The trade visitors were convinced by the quality of the products presented, like the essence of rose, walnut oil, dried apricots, mulberries and exclusive silk scarves, and ordered Afghan goods. Since March 2011, EPAA has been providing a “one-stop shop” for cross-border trade. Domestic and foreign traders can obtain information and documents for their export products from one central point of contact – before, they had to go to a dozen agencies.
In addition, crucial support for the private sector is provided by the Afghanistan Chamber of Commerce & Industries (ACCI), which can look back on an 80 year tradition. Since 2002, it has repositioned itself with the aid of GIZ. Today, with 21 provincial chambers and 10,000 members, it is a top-level organisation of the Afghan industry. The regional chambers have begun to address the needs of entrepreneurs and offer them services, such as training courses or support in drawing up business plans. In April 2011, the Balkh Business Fair took place for the first time: within three days, 75 manufacturers and dealers sold 34,000 US dollars worth of products and received 400,000 US dollars worth of advance orders. In addition, ACCI organises cooperation and networking services for foreign and Afghan companies.
To enable companies to recruit a sufficient number of professionals in the future, we support the Afghan Ministry of Education on behalf of BMZ and the Federal Foreign Office in reforming education. .
Teenagers in selected vocational schools receive an education in commercial and technical subjects, which opens up sustainable employment opportunities. In Kabul and the provincial capitals in the north and northeast, training centres for male and female teachers for vocational schools were opened so that teenagers can be trained in line with actual practice and according to uniform standards.
Partner for interested companies. GIZ works closely together with the German embassy in Kabul as contact point for interested German companies. We support measures such as the Round Table discussion in Berlin, organised by the German government, which supports the economic cooperation with Afghanistan, and we conduct delegation tours for German entrepreneurs. A guide on Afghan economy by Germany Trade and Invest (GTAI), published in June 2011, was developed on behalf of the BMZ. This guide evaluates the potential in different sectors and provides information about enterprise foundations and parameters in Afghanistan. We are also active in development partnerships with the industry to offer German and European enterprises individual support. Here our experts provide their local contacts, country-specific expertise and specialist know-how to enable enterprises to take the step into this challenging market. The fact is: Afghanistan needs economic development to give its population a future.
As country director and project advisor for the Konrad Adenauer Foundation in Egypt, the author was responsible for the Arab countries/North Africa. In 1981, he moved to Brazil where he continued to work in the same role. In 1993, Dr. Eisenblätter joined GTZ as director of the country department for Latin America and the Maghreb. In 1996, he became the managing director of GTZ and since 2011, he has been the spokesperson for the management board of GIZ.