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SLUG: 5-52478 Afghan Investment
DATE:
NOTE NUMBER:

DATE=10/28/02

TYPE=BACKGROUND REPORT

NUMBER=5-52478

TITLE=AFGHAN-INVEST

BYLINE=GARY THOMAS

DATELINE=KABUL

CONTENT=

VOICE AT:

INTRO: After Afghanistan was freed from the grip of the Taleban almost one-year ago, many Afghan expatriates came back to invest in their homeland. But, as Correspondent Gary Thomas reports from Kabul, many have now left in disappointment and bewilderment.

TEXT: For returning Afghans, the joy of liberation meant they could help their homeland rebuild after years of war and civil strife. Many had become successful businesspeople in Europe or the United States and were anxious to contribute.

But according to Afghan expatriates returned to Kabul, many have packed their bags again and left Afghanistan after running into bureaucratic roadblocks and a wall of corruption.

Azim Naseer-Zia, a former Afghan diplomat, says the initial enthusiasm among expatriate Afghans has vanished.

/// NASEER-ZIA ACT ///

There are people I know who came to invest here millions of dollars, investments and all that. But they were faced with very strange, very bizarre, very to some extent, stupid bureaucratic problems.

/// END ACT ///

Ali Seraj, an Afghan-American businessman who has been trying to set up, among other things, a telecommunications network, says it is a nightmare to try for anyone foreigner or returned Afghan expatriate to do business in Afghanistan.

/// SERAJ ACT ///

When we go to the different ministers, they talk the right talk. You know, they all talk about free enterprise, they all talk about investment, they all talk about all these wonderful rules and regulations and laws that they have come up with. But when it comes to application, the minute you go in, we fall back into an old communist system where if you have to get a permit for something, you have to have eight ministers signing off on it. Everybody has got to look at it. I do not understand why.

/// END ACT ///

The government of interim President Hamid Karzai is anxious to woo investment and expertise. He promulgated a law that, among other things, allows 100-percent foreign control in a firm investing here. But Afghan ex-pats say the policy has not filtered down to the working bureaucratic levels.

Adib Fehadi of Afghan Foreign Ministry economic department himself a returned expatriate - says the government is doing its best to facilitate investment, especially by returning Afghans. He points out that two-thousand projects, large and small, have been approved in the past two-weeks, and that the tales of bureaucratic roadblocks are inflated.

/// FEHADI ACT ///

So there is activity. There is activity happening. And there may be some issues where frustrations may have occurred, issues where some hindrance may have occurred. And if we know about it, we try to help, to facilitate, especially in the Ministry of Foreign Affairs. But at the same time, generally, we are trying to educate the lower echelons or working desks of the priorities of the country. And, as a whole, I think it is working very well.

/// END ACT ///

But many Afghan expatriates disagree, and offer different theories as to why they are running into bureaucratic opposition. Some believe it is petty jealousy by the bureaucrats at Afghans who left the country and struck it rich abroad while they stayed behind and suffered.

Mr. Seraj says the government roadblocks are hindering the creation of jobs in Afghanistan, and that free enterprise can help the country more than aid organizations.

/// SERAJ ACT ///

But if I am going to bring my money over here, and I am going to invest it in something that is going to create jobs for five people, and each person has 10 in his family, that is going to feed 50-people. What is wrong with that?

/// END ACT ///

Investors have also run into what they describe as endemic corruption, with requests for bribes commonplace. But, as Mr. Seraj points out, it is hard to condemn someone for soliciting a bribe when their salary may only be about 15-dollars a month and they have not been paid anyway. (SIGNED)

NEB/GPT/RAE



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