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Key Economic Data 
  2003 2002 2001 Ranking(2003)
Millions of US $ 8,383 6,413 5,500 95
GNI per capita
 US $ 3,870 4,130 3,870 72
Ranking is given out of 208 nations - (data from the World Bank)

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Area ( 


ethnic groups 
Estonians 63.9%
Russians 29%
Ukrainians 2.7%



Arnold Rüütel

Update No: 052 - (24/03/06)

Oil in Afghanistan?
In March a stir was caused by the announcement of the Ministry of Mining and Industry that a survey indicated greater than expected oil and gas reserves in Afghanistan. While gas and small quantities of oil were already being extracted from Afghanistan's soil in the past, the new survey by the US Geological Survey estimates potential reserves at up to 1.5 billion barrels of oil, that is up to 18 times previous estimates, and 15.6 trillion cubic feet of natural gas, or three times as much as it had previously been estimated. These reserves are however unproven and are located in the northern part of the country, north of the Hindukush mountains. Exporting them, therefore, would not be easy or cheap even if they were confirmed. Afghanistan might find itself once again in the same predicament as in the 1970s, when it was forced to sell natural gas to the Soviet Union at lower than market prices due to the unavailability of alternative export routes. The transit costs of exporting through the northern route would be high and the prices which Afghanistan could obtain probably low, judging from current Russian policies towards gas-rich former Soviet Union countries such as Turkmenistan. The political risks of investing in Afghanistan, together with the existence of more attractive opportunities elsewhere, might put off any possibility of large-scale investment anytime soon. The most likely option for Afghanistan is the re-activation of the gas fields around Shiberghan and oil fields in Sar-i Pul province, which were sealed in the late 1980s when the Soviets left the country. Afghanistan already has a law, approved last year, which allows foreign companies to invest in the oil and gas sector. So far little has been done with regard to the existing infrastructure. There are a total of one active oil and two gas fields, out of 15 which had been opened up to 1984. In March it was announced that an American company had completed a topping plant for the processing of crude at Angot oil field. The company, Oxiana Energy, is awaiting authorisation for reactivating other oil fields in the same area. The two gas wells in Sheberghan are extracting gas for local consumption and there are plans to reactivate the pipeline which used to pump gas to the city of Mazar-i Sharif. 

Investment climate improves, but not quite enough yet
At the end of February the World Bank released a report on the Afghan private sector, which highlights how the investment climate is improving yet not enough to attract actual investors. While investment for an amount of US$1.3 billion has been pledged by private investors to the Afghan Investment Support Agency, a government-sponsored initiative, only a small fraction of it has actually been invested and even that in the building sector, which is driven by an externally-funded reconstruction effort. 

Karzai challenges Musharraf
In an unusual display of determination, President Karzai raised the issue of border infiltrations by anti-government guerrillas during his visit to Pakistan in March. Musharraf was not amused and in turn accused the Afghan government of not being able to control its own border and allowing extremists to enter Pakistan. The polemic continued within Afghanistan, where various groups and factions started accusing each other of having links to Pakistan. In particular, Defence Minister Wardak was the target of some of these accusations. The car bomb campaign in southern Afghanistan in January created a wave of anti-Pakistani resentment among the Pashtuns who live along the border with Pakistan and now some political groups in Kabul, opposed to Pakistani influence, are trying to exploit this.

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