Wednesday, August 1, 2012

Aynak prospect fading

Afghanistan’s trillion dollar wealth is buried in the belly of her rough rocky terrain which requires serious capital intensive operation to unearth and sell it.  The country’s treasury finances the national budget largely from the donation contributed by foreign aid agencies. The external donation is decreasing as the year 2014 of large military withdrawal is approaching. Afghans are desperately looking for other sources of revenues to make the treasury budget fit.
Natural resources specifically the minerals and hydrocarbons are deemed as potential anchors to the economy post 2014.  The World Bank (2004) wrote its first report about the potential of the natural resources in 2004 which was subsequently complemented by translation of the Russian geological data of Afghanistan’s mineral wealth and further studies by the United States Geological Survey to identify potential sites for investment.
There are feasible ore bodies across the country which could bring lucre to Afghanistan. Among them is the Aynak Copper Mine which is 60 km from Kabul city. It has 11.3 pure copper reserves.It was won by the a Chinese joint venture promising to invest around 3 billion dollars in the site with additional promise of building a railway line to connect north to the east of country. The government would get around 300-400 million dollars annually from the export of copper produced, besides employment for Afghans. Mine operation in the area would see brisk urbanization, in-migration, economic expansion, infrastructure project and better security.
Investment in Aynak Copper mine offered window of opportunity for the Afghan government to get regular cash as well as keep a big regional power interested in Afghanistan. Work on the site in Aynak led to employment of many youth in the region which became an attraction for other youth who waited for an opportunity to work. Some of the youth felt a sense of pride in getting US$ 150 per month job with the Chinese. Conversations with some people showed a feeling of jubilation and economic security among them. One of the villager said “Iam working with the mining company and I am happy”. One of the merryold men said that he even stopped insurgents coming into the area to attack the mining site because he convinced themthat it was his source of livelihood. Other then the land issue there was no major stagnant issue. 
However, the Aynak prospects are fading now.  The removal of Atiqullah Ludin the former governor of Logar province who had major contracts from the mining company and the sudden emergence of insurgents in the region has disturbed the equations.  The number of insurgents has increased which have led to increase in attacks on the mining site. 
The land issue is a persisting dilemma for the government. This led to some disillusionment among local people.  The team authorized by the Ministry of Mines, which is largely funded by the World Bank did not see the opportunities to work towards stability and prepare ground for progress. The social development team of the Ministry of Mines failed to figure out the culture and structures of the communities and thus led to persistence of unresolved issues.  The policy team advocated for settling communities claims led to distrust of government.
Recently some rockets landed on the residential compound built for the Chinese workers prompting fear among the laborers unfamiliar with Afghanistan conditions. The laborers abandoned their work and discharged their Afghan employees on short notice.  Insurgent have asked for money from the Chinese or else they would threaten the project. The project has come to a crashing halt which led to conspiracy of foreign involvement.The closure of major activities in the Aynak has rendered many young men jobless and they may turn into easy recruits to insurgents.

By Javed Noorani

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