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Editorial comment

A recent article in The New York Times indicates that Afghanistan could one day be the mining centre of the world, given the assertion by Pentagon officials that the country holds some US$1 trillion worth of untapped minerals deposits. Quoting a Pentagon memo, the article posits that the country could become the ‘Saudi Arabia of lithium’ – a metal used in batteries for laptops and BlackBerrys. Other key metals and minerals discovered during various geological surveys include iron, copper, niobium, gold, multiple gemstones, and – our favourite – limestone, but of course that is less of a rarity. So, the natural resources exist for plentiful cement supplies, but the infrastructure does not…More on that later.

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Certainly, trading on minerals wealth would make a nice change to trading opium, which has so far been Afghanistan’s biggest export. On the surface, it would seem that minerals would also be a more peaceable commodity. According to some rather vague UN statistics, Afghan opium kills over 100 000 people every year – the reference doesn’t state whether this includes those that die fighting over land and market share, or general drugs-related criminal activity, but I would guess not, or perhaps the number would be higher still. Compared to this, the somewhat traditional – one might say ‘staid’ – mining industry is surely a relatively safe bet. Mining, however, is not the safest activity in the world; it is responsible for thousands of deaths each year. In China alone mining fatalities worked out at 7.2 per day in 2009 according to figures from the State Administration of Coal Mine Safety. (It should be noted that this represents a fall in fatalities of 20% y/y – progress is being made.)

Of course, the danger posed by mining itself would most likely be the tip of a very large iceberg. The value inherent in Afghanistan’s mineral deposits puts it at risk in the same way that the opium industry does – why would the Taliban relinquish its hold when the country is discovering its worth? But then, if the Taliban remain, who will invest in a country that is so unstable? And without investment in infrastructure, technology, manpower and so on, the resources will remain untapped and therefore worthless. The situation has the makings of a particularly vicious circle.

Now back to cement. According to a 2008 USGS report, Afghanistan’s cement production was estimated to be about 50 000 tpa. With a population approaching 30 million people and urgent reconstruction needs, demand is certainly outstripping supply. Just like Iraq, there is abundant potential in Afghanistan for brave, willing investors. (For more on the latest developments in Iraq, see the Regional Insights at Readers of Palladian Publications’ Emerging Markets Report 2007 may remember the article from Box International Consulting describing the author’s personal experiences in Iraq and Afghanistan. This included dodging unexploded bombs, using bridges made of tanks, and generally avoiding capture and/or death during a particularly volatile time in both countries’ histories. The article concluded, however, that ‘both countries will ultimately be successfully rebuilt along the lines of other post-conflict emerging markets’ and for Iraq the reconstruction has already begun. I fear that Afghanistan’s newly publicised wealth may drag out the conflict for some time to come, hindering rather than helping with restoration.

Although this year’s World Review (starting on page 16) does not include entries from Afghanistan (next year, perhaps), much of the rest of the world is referenced in this hefty tome! Thanks so much to everyone who sent in project news for inclusion. For those with a country-specific interest, do visit for Paul Maxwell-Cook’s Regional Insights, with this month’s edition focusing on Indonesia.