KABUL: An economic transformation is taking place in Afghanistan right now, with a goal to boost private investment to create jobs and sustainable industries.
During the past few months, the government has passed significant economic legislation, opened up opportunities across new sectors and cut bureaucratic red tape to encourage businesspersons to invest.
The investor’s rights were not protected by legislation, and he or she would find it nearly impossible to obtain credit; all of this, in addition to security concerns. It’s no wonder then why economic growth languished over the past decade, and investors were scarce in Afghanistan.
Over the past few years, the National Unity Government has taken action to create a more enabling environment for investors and private-sector development. First, the government reduced regulatory burdens, cutting the cost of obtaining a new business license from $440 to only $1.
Second, we passed important new legislation that forms the legal foundation of a market economy. Our new Companies Law dramatically improves the protection of investors’ rights, allowing them to take minority stakes in operating companies, confident in knowing that their rights are protected.
We also passed a new Insolvency Law to make it easier to obtain capital for businesses and to enter into bankruptcy procedures for companies that do face challenges. This law replaces one that had not been updated since 1942.
A new mining law that provides a strong legal foundation and a transparent bidding process for the sector will be passed before the end of 2018.
Third, a number of large regional projects are being implemented. Whereas five years ago, Afghanistan did not have a single operational railroad, we now have four functioning railway connections with three neighbors.
The Turkmenistan-Afghanistan-Pakistan-India (TAPI) project, which had been discussed for decades, stared construction at the Afghan border earlier this year. We are in the process of finalizing the Host Government Agreement (HGA) and have reconfigured the project to make it financially feasible.
The CASA-1000 project, which will connect Central Asian Hydropower potential to South Asia, is in the procurement sage. Each of these projects will generate jobs and align regional countries’ interests with Afghanistan’s economic development.
