19 January 2020

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Economic

Friday January 17, 2020
Kabul (BNA) Growing Chinese commitment to Afghanistan’s pine-nut industry is a small but illuminating example of Beijing’s interest in the region bordering Xinjiang, says Barbara Kelemen.
A burgeoning pine-nut trade between Afghanistan and China shines a light on Beijing’s growing interest in the region on its western border. Last year, the two countries boosted Afghanistan’s pine-nut industry when they opened an air-freight corridor, and this November, Chinese companies contracted to buy 2.2 billion dollars of Afghan pine nuts over the next five years. Given Afghanistan’s exports to China were 28 million dollars in 2018 and overall exports reached roughly 884 million dollars, China’s importance looks set to rise.
The air-corridor to Shanghai was hailed as a great improvement and expected to raise revenues from pine nut exports to 1 million dollars – and it seems to be living up to expectations. The Afghan government in October said the pine nut harvest would rise 10 percent to around 24,000 tons in 2019. With the dried fruit selling at around 36 dollars per kilo, farmers can expect additional revenues of around 800,000 dollars, mainly thanks to Chinese demand.
Before the opening of the air corridor, Afghanistan struggled with rampant smuggling – and some legal exports ¬– to Pakistan. Across the border the pine nuts were packaged and re-exported, often to China. As Afghanistan still lacks facilities and certification needed for processing pine nuts, the refining stages have merely shifted from Pakistan to China. The profits from value added processes now go to China – and Afghan traders still export only raw product.
China-Afghan economic cooperation still faces challenges
So there is light and dark when it comes to this instance of economic cooperation – it clearly still faces challenges. Yousef Dawran, a local pine-nut trader and entrepreneur, worries that “air corridors are too expensive and mainly a short-term solution” and calls the project “mainly a great PR story”. According to Yousef, real economic change requires longer term and more sustainable solutions. Perhaps Afghanistan needs to focus more on pine-nut processing capacity.
Yousef’s disappointment is fed by the feeling that the cooperation has not delivered “as much as expected” – that China could and should be doing more. Alice Wells, the US Acting Assistant Secretary for South and Central Asia, has on a number of occasions criticized China for its lack of economic assistance to Afghanistan. She has described Beijing’s Belt and Road Initiative (BRI) in Afghanistan as a “slogan” rather than reality, pointing to stalled projects such as the Kabul-Jalalabad Road. 
China sees economic cooperation as a way to stabilize Afghanistan
China’s government has sharply rejected such complaints, in turn pointing to projects like the 2016 cargo train between Nantong and Hairatan, the 2018 air corridor and a number of infrastructure projects as proof of its genuine commitment. Yao Jing, the Chinese Ambassador to Pakistan, has said that the main challenge for larger Chinese projects – such as the Mes Aynak copper mine – remains Afghanistan’s ongoing lack of domestic security and stability.
But that is also exactly why China has to continue with economic cooperation projects, however small or fraught. Beijing sees economic cooperation as a way to stabilize a country that is in turn vital for stability of China’s western provinces, especially Xinjiang. Beijing worries that the East Turkestan Islamic Movement (ETIM) or its successor organization, the Turkestan Islamic Party (TIP), consider Afghanistan a conduit into China to radicalize Uighurs in Xinjiang.
Afghanistan’s regional significance for China’s security is one reason for China’s greater military presence on its western periphery. The People’s Armed Police force has for some time operated from bases in Tajikistan only 10 miles from the Afghan border. There have also been reports of Chinese activities in Afghanistan’s Wakhan corridor in Badakhshan province. And Chinese officials have maintained a pragmatic relationship with the Taliban since the late 90s.
Beijing has emerged as a new facilitator of talks between Afghan conflict parties
Given all this, Beijing has emerged as a new facilitator of talks between the Afghan government and the Taliban. Without the historical legacy of Russia or the US, with economic clout in Kabul and considerable influence in Islamabad, it could become a more trusted go-between for Afghanistan’s long warring factions than other parties. Pakistan’s support has been crucial to the Taliban and has complicated Islamabad’s bilateral relations with the United States.
A clear sign of China’s increasing influence is its push to start an Afghan peace process. A meeting between the Taliban and the Afghan government is now set to take place in Beijing. Although it is hard to say how much of it is the Taliban showing the US that it has alternatives, China is now seen as one of the potential brokers and facilitators of the intra-Afghan dialogue. It has relations with Kabul, contacts with the Taliban, and potentially holds sway over Pakistan.
US President Donald Trump has pledged to reduce the US military presence in Afghanistan and about half of the US soldiers in the country are expected to start going home soon. As complete US-withdrawal from Afghanistan has become possible, the question is whether China would step up to fill the void as a stabilizing power. Its commitment to the Afghan pine-nut industry suggests that there are ways for China to do so although its intentions in that regard remain unclear. For all his criticism, pine-nut trader Yousef firmly believes economics and stability come hand in hand.
Merics

Thursday, January 16, 2020
Kabul (BNA) President Mohammad Ashraf Ghani in a meeting on Tuesday with deputy of World Bank (WB) for South Asia and his accompanied delegation discussed the bank’s assistance and support to Afghanistan, a statement said.
In the meeting held at Presidential Palace with participation of World Bank chairperson for Afghanistan, President Ghani briefed related to Afghanistan government’s programs in particular development programs in the field of education, mines, customs and increasing of the country’s revenues and Afghanistan economic landscape, the presidential press office statement said
Speaking related to the government’s reforms package, the country’s President said the reforms’ logic was to deliver better services, enhance effectiveness and build capacity of the government institutions.
President Ghani said that the government was seriously committed to bringing reforms as their goal was to deliver effective, equal and technology-based services to the people, stressing on investment on renewable energy, construction of hydropower dams and water management, counter-poverty to reduce it, increasing of agricultural products and attention to values of the product in the country.
The country’s President by stating that Afghanistan exports have reached to more than $1billion said the government would further invest on Afghanistan electricity projects in future, stressing on regional connectivity and economic efforts in the region. In the meeting, deputy of the World Bank for South Asia affairs once again declared the bank’s support from economic and development programs of President Ghani and the government of Afghanistan.

Wednesday, January 15, 2020
Kabul (BNA) The National Procurement Commission meeting with President Mohammad Ashraf Ghani on the chair discussed 29 procurement contracts and approved 28 of which worth more than 4.5 billion Afghanis, including the plan for investments on re-activation of Bakhtar Airlines related to Ariana Afghan Airlines, the statement from presidential press office said yesterday.
The commission also approved amendments to some contracts and restored the contract related to construction of a two-story building for Paktia provincial office.
The president emphasized that all projects should be completed on due time and that delays in implementation of projects should be avoided, according to the statement.
The meeting concluded with approving the payment for last installment related to construction of gymnasium in Logar province, related to general directorate of physical educations and sports.

Tuesday, January 14, 2020
Kabul (BNA) Chaired by Chief Executive Dr. Abdullah Abdullah, the meeting of council of minister’s economic committee was held yesterday at Sapidar palace.
In the meeting, National Environment Protection Authority reported of recent steps taken for prevention of air pollution in Kabul city.  Based on the report, efforts towards reduction of air pollution in Kabul city have increased during the past three weeks and the process was underway.
According to NEPA, fuel system of 218 addresses including buildings and townships, brick companies, government institutions and manufacturing companies have been seriously monitored and assess and awareness as well as consequences of air pollution and delivering mechanisms for prevention of increasing air pollution are underway.
After hearing the report, the country’s chief executive Dr, Abdullah Abdullah said efforts for counter increasing air pollution should not be stopped by starting snowfalls in the country, but it should be used as an opportunity.
Afterwards, the ministry of commerce and industry shared the causes of high price of domestic products to participants in the meeting.
Based on the report, high transportation expenses, lack of power and energy for manufacturing companies, lack of awareness of the companies of international standards, lack of necessary raw materials in manufacturing companies, lack of stability and balance in exchanging Afghani currency, bureaucracy in government institutions and lack of workers and experienced personnel are the most significant factors of increasing the price of domestic products.
Chief executive said that part of the mentioned factors had connection to general situation of Afghanistan, but transportation problems, bureaucracy and corruption in government institutions should not stop economic development of the country, asking for addressing the problems in this regard.
The country’s chief executive instructed relevant institutions to include the respective issues in the meeting of execution enduring development committee to address each one separately.  Regarding report of the ministry of agriculture, livestock and irrigation, chief executive said India has promised to provide 75,000 tons wheat in assistance to Afghanistan, but it has not been implemented so far, asking the ministry to pave the way for receiving the assistance as soon as possible.

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