|
REPUBLICAN REFERENCE
Area (sq.km)
647,500
Population
26,813,057
Capital
Kabul
Currency
afghani (AFA)
President
Hamid Karzai
a free service

democracy check

currency converter
|
|
|
Background:
Afghanistan was invaded and occupied by the Soviet Union in 1979, in the attempt to rescue and consolidate the pro-Soviet regime in place. It took 10 years
before the USSR could withdraw its forces, having been delayed by the fierce resistance of anti-communist mujahidin forces, supplied and trained by the US,
Saudi Arabia, Pakistan, and others. The pro-soviet regime survived for two years and a half, contrary to the expectations of many, and then fell in April
1992, having outlived its own mentor, the USSR. Fighting subsequently continued among the various mujahidin factions, but the fundamentalist Islamic Taliban
movement had been able to seize most of the country. In addition to the continuing civil strife, the country suffers from enormous poverty, a crumbling
infrastructure, and widespread land mines. |
Update No: 01
Contrary to what many feared, the latest Afghan crisis
has been far from being a disaster for the country and might well turn out to be
a blessing. The looming humanitarian disaster, due to the drought in the
northern half of Afghanistan, has now been largely averted, while a new
government, led by Hamid Karzai, has been sworn in on 22 December. The new
government will be able to count on international support, as its role in
stabilising the country and rooting out the last remnants of the Taliban and Al-Qaida
is crucial.
The only
threat to the new government comes from within. Several factions of the United
Front, which holds most power within the government, have expressed their
dissatisfaction with the present distribution of ministerial posts, of which the
main faction, Jamiat-i Islami, has taken the largest slice at the
expense of other factions, such as Jumbesh-i Milli, led by Rashid
Dostum. After a revolt against Jamiat-i Islami in the town of Pul-i
Khumri in mid-December, apparently supported by Dostum himself, Jumbesh-i
Milli was appeased by Prime Minister Karzai with the nomination of Dostum as
Deputy-Minister of Defence.
Many factions
are now wrestling for power, in the expectation that soon international aid will
start flowing in, providing key resources to be used in the consolidation of
their often tenuous hold on many parts of the country. Controlling positions in
the government and the state bureucracy becomes crucial in re-directing
international aid towards the “right people” in the “right places.”
Unsurprisingly, one of the first acts of Jamiat-i Islami after it seized
Kabul, over which it still has almost exclusive control, has been to staff as
many positions as possible in the state administration with its own people.
Assuming the
new government succeeds in remaining cohesive and in maintaining a degree of
control over the country, it is expected that the UN rehabilitation and
reconstruction effort will involve the expenditure of US$6.5 billion over five
years, mainly with the aim of rebuilding the basic infrastructure and services,
train new cadres for the state administration,
and kick-start agricultural production again. While the state of
agriculture is very crucial to the welfare of the Afghan population,
international investment will be focused on transport, telecommunications and
natural resources.
The transport
network is in a very depleted state and requires large-scale investments to be
repaired and updated. Little is left of both Afghanistan’s internal and
external airlines, Ariana and Bakhtar, which will need new equipment. The
probable source of much of this equipment is likely to be Russia, which has
plenty of second-hand turbo-prop cargo planes and helicopters to offer.
Airports, which will play an important role in the future, due to the
undedeveloped road network and to the presence of large numbers of personnel
from the UN and the various peace-keeping armies, will also need repairs and
upgrades. At present, 35 out of 45 of them have unpaved runaways.
Important
efforts will also be needed for repairing and possibly expanding the road
network, the role of which is crucial to the consolidation of hold of the
central government over the country. The existing 24,000 kilometers of road need
comprehensive reconstruction work, while UN analysts estimate than an extra
6,000 kilometers will have to be built to complete the network, especially in
the most remote regions, such as Hazarajat (Central Afghanistan) and Badakhshan
(North-east Afghanistan). These regions are home to two important factions of
the United Front and they are likely to push for new roads to be built.
The
telecommunications system in Afghanistan also badly needs investment. At present
only the main cities are linked by a telephone network, while an Afghan/British
joint venture was busy developing national, international telecommunications,
GSM mobile and internet facilities until in 1999 its activities were stopped by
international sanctions against the Taliban regime. The UN appear inclined to
leave the development of telecommunications to commercial organisations, in
cooperation with the government.
Prospects of economic development in Afghanistan are linked to the
expansion of natural gas production, presently limited to just 2 billion cubic
meters per year, almost entirely exported to Uzbekistan, despite reserves
estimated at 1,100 billion. The gas fields are located mostly around Shiberghan,
very close to the northern border, but presence of natural gas is also reported
in Sar-i Pul, Central Afghanistan. The price paid for this gas is below
international prices, due to the strong competition coming from other Central
Asian fields. Increasing gas exports in the short term would be conditional on
negotiating agreements with Central Asian states and Russia, in order to be
allowed to use their networks. Prospects for oil and gas pipelines from either
Afghanistan itself or from Turkmenistan and Uzbekistan running through
Afghanistan towards Pakistan and the sea look still rather remote at present,
despite the enthusiasm of some Western businessmen. The government will need to
establish a disciplined central army and disarm the tribal and party militias,
before anybody actually starts making the large-scale resources required
available.
« Top
|
CUSTOMISED REPORTS |
|
INVESTMENT BACKGROUND REPORTS |
|
Our analysts and editorial staff have many years experience in analysing and reporting events in these nations. This knowledge is available
in the form of geopolitical and/or economic country reports on any individual or grouping of countries. Such reports may be bespoke to the specification of
clients or by access to one of our existing specialised reports.
For further information email:
reports@newnations.com |
Considering an investment or a trip to any newnation? First order our Investment Pack which will give you by e-mail the last three monthly
newnation reports and the complete worldaudit democracy check for the low price of US$12. The print-out would be a good companion to take with you. Having
read it, you might even decide not to go!
To order please click here:
Investment background report |
« Top |