Mineral Rich Afghanistan Contains Promise And Problems

Infrastructure must be created throughout
much of the country before mining efforts
may commence.

AFGHANISTAN (NYT) -- It is estimated that Afghanistan possesses nearly one trillion USD in untapped minerals such as gold, lithium, and copper. Though there is potential for Afghanistan to use these resources to become a self-sustaining country and player in the global market, overwhelming concerns regarding government corruption, lack of existing infrastructure, and violence overshadow this hope. Fears of a countrywide civil conflict exist as various factions recently started fighting over mineral rich territory, scaring off international investors. The government rejected legislation that it considered too favorable to Western interests. However, it since allowed Chinese companies to mine for oil, copper, and rare-earth, all while arguing other contracts awarded through spoils and regional political influence. In addition, there are concerns about proven illegal mining and smuggling of minerals to neighboring countries in order to fuel insurgencies.  Despite the negatives, the people of Afghanistan eagerly await for more mining to begin, as it is estimated that such activity could bring as many as 50,000 jobs helping to lift many of the families out of poverty and provide education to their children. Source: Potential for a Mining Boom Splits Factions in Afghanistan (Reliability: High)

Comment: As long as Afghanistan continues to experience violence and instability, the mining industry will be very slow to come to fruition, if ever, crushing the hopes of the people who want a better life.

Potential Mining Boom Splits Factions in Afghanistan

Mining projects have begun in some
 areas of Afghanistan with foreign help

KALU VALLEY (NYT)--Afghanistan's trillion dollar reservoir of natural resources in oil, gold, iron ore, copper, lithium and other minerals has increased corruption, and violence in Afghanistan. There is concern that the potential mineral wealth could fuel civil conflicts between ethnic groups. Mining projects are very beneficial for the citizens of Afghanistan. This summer an investment consortium arranged by JP Morgan Chase is mining for gold in Afghanistan, and a Chinese company is trying to develop a huge copper mine. Four copper and gold contracts are being tendered, and contracts for rare earth metals could be offered soon.  The World Bank estimates that mining and agriculture together could raise annual growth by 3 to 4 percentage points between now and 2025. Mining laws that are vital in attracting foreign investment are being delayed, which could potentially threaten several projects. Source: Potential for a Mining Boom Splits Factions in Afghanistan (Reliability: High)

Comment:  Among the Afghan public there is skepticism that Afghanistan's weak state and corrupt ministries can build a functioning mining economy that will benefit its citizens. The government has been accused of putting pressure on the Chinese oil company to make illegal payoffs. In Mes Aynak, nine villages were displaced for mining projects which has caused tensions among locals contending for compensation for their land.