Despite the economic growth since the fall of the Taliban, Afghanistan remains one of the world's poorest countries with 40 percent unemployment and half the population living in some form of poverty. Ongoing security concerns, challenge Afghans to double their efforts to establish a self-sustaining economy that encourages trade and investment required to generate jobs. USAID’s economic growth programs helps the Afghan government (GIRoA) develop sound economic governance and works with the private sector to stimulate investment and business opportunities post-transition. USAID partners with Afghans and GIRoA to attract investment, generate sustainable employment, and expand market linkages—goals especially critical as we head towards transition in 2014.
USAID Afghanistan’s Economic Growth program uses a multipronged approach to build Afghanistan’s economic stability. USAID supports Afghan businessmen and women in the private sector to access finance, connect to markets, and gain the skills they need for their businesses to prosper. USAID improves business climate through the work with GIRoA and with Afghan business associations. USAID supports high-potential investment opportunities in the extractives industry, and works with GIRoA to increase government revenue and improve government effectiveness. At a policy level, USAID supports trade reform and Afghanistan’s accession to the World Trade Organization, fiscal reform, and land reform.
DEVELOPING THE PRIVATE SECTOR
USAID focuses on improving private-sector productivity and the business environment to attract private-sector investment. USAID supported the development of industrial parks in Kabul and Mazar-i Sharif, and provides a wide range of business development services to encourage the establishment and growth of all enterprises including management skills training, market information, and public-private alliance grants. To date, USAID and GIRoA have created some 493,000 jobs and launched 56 public-private partnerships leveraging more than $95 million from private sector-partners in insurance, natural resource extraction, apparel, communications/media, information technology, and food processing.
STRENGTHENING BUSINESS ASSOCIATIONS
USAID and GIRoA’s support for business associations resulted in establishing a Chamber of Commerce and Industry offices in Kandahar, Mazar-i Sharif, Hirat, Kunduz, and Jalalabad, and building the capacity of other provincial and local business associations. Over the past decade, USAID has helped establish 125 business associations (including 27 women-owned) and supported more than 250 associations with grants for equipment, capacity building, and improving member services.
TRADE AND INVESTMENT
USAID helps GIRoA and the private-sector maximize regional and global trade linkages and export-oriented business development through assistance in trade policy liberalization and World Trade Organization (WTO) accession, trade facilitation and customs reform, and public outreach on trade-related issues. USAID worked with GIRoA to negotiate the Afghanistan-Pakistan Trade and Transit Agreement, advised on the ratification of the South Asia Free Trade Agreement, and supported the successful initiation of the WTO accession process. USAID is working alongside GIRoA to promote transparency, reduce trade barriers, and increase customs revenue.
ENHANCING COMPETITIVENESS & INSTITUTIONAL CAPACITY
USAID helps to strengthen institutional capacity, promote transparency, and improve the business enabling environment in Afghanistan. Legal and regulatory reforms to improve the business-enabling environment have already resulted in more than $1.5 billion in telecom investment and created more than 100,000 jobs since 2003. Assistance to key ministries and government agencies is strengthening capacity and performance, as exemplified by improvements in budget planning and execution and an increase of 180 percent in fiscal revenues from $715,000 in March 2008, to $2 billion in March 2012.
Property rights are a complex issue for all Afghans, but especially for the millions living in informal settlements after decades of conflict. USAID is assisting the Afghan Land Authority to ensure the clear transfer and documentation of land ownership for Afghan citizens in informal settlements. Program activities also supported the National Land Law, approved in 2008 which helped to streamline land registry offices in 21 provinces, and established a land survey/mapping curriculum at the Kabul Polytechnic University. Cooperation with the Supreme Court streamlined the registration of property from 34 steps to just three for urban land, and four for rural land.
Afghanistan is able to expand its financial services with the development of a sustainable and inclusive financial sector that serves the needs of micro, small, and medium enterprises throughout the country, with a special focus on the agricultural sector, and the southern and eastern regions. By 2012, USAID-funded credit unions disbursed more than 58,000 loans (13 percent to women) in 17 provinces, totaling $57 million, and helping to create more than 88,000 jobs. USAID is encouraging the growth of mobile banking as an innovative foundational investment to promote financial inclusion and lessen corruption through technology.
Afghanistan has a wealth of natural resources, which, if exploited in line with international standards, could dramatically improve equitable growth and increase government revenues. USAID-funded research, undertaken by the United States Geological Survey in partnership with the Ministry of Mines, has resulted in the identification of significant deposits of industrial and precious minerals across Afghanistan with a total estimated value close to $1 trillion. USAID has supported the gemstone sector through training in stone-cutting and polishing. Assistance to the marble sector has resulted in the establishment of a sustainable marble association, convening of international marble conferences in Afghanistan, introduction of modern marble quarrying techniques, and facilitation of marble exports exceeding $24 million annually.
- Afghan Growth Finance (AGF)
- Afghanistan Trade and Revenue Project (ATAR)
- Afghanistan Workforce Development Program (AWDP)
- Air Traffic Controllers Training to the Ministry of Transportation and Civil Aviation (MoCAT) (Phase II)
- Arazi (Afghan Land Authority) via MAIL (Ministry of Agriculture, Irrigation and Livestock) On-Budget Component
- Assistance in Building Afghanistan by Developing Enterprises (ABADE)
- Better Than Cash
- Building Livelihoods and Trade by Turquoise Mountain Foundation (TMF)
- Commercial Law Development Program (CLDP)
- Development Credit Authority (DCA)
- E-Governance Resource Center (EGRC)
- Financial Access for Investing in the Development of Afghanistan (FAIDA)
- Investment Climate Reform Program in Afghanistan (Doing Business Indicators)
- Land Reform in Afghanistan (LARA)
- Mining Investment and Development for Afghanistan Sustainability (MIDAS)
- Multi-Input Area Development - Global Development Alliance (MIAD GDA)
- Afghan New Beginning Program
- Afghanistan Credit Support Program (ACSP)
- Afghanistan National Innovation and Competitiveness Program
- Afghanistan Renewal Fund
- Afghanistan Small and Medium Enterprise Development (ASMED)
- Agriculture, Rural Investment, and Enterprise Strengthening (ARIES)
- Aid Management and Coordination and Public Information
- Economic Governance & Private Sector Strengthening (EGPSS)
- Economic Governance in Afghanistan
- Economic Growth and Governance Initiative (EGGI)
- English and Computer Basic Training for Afghanistan Geology Survey (AGS)
- Establishment of National Payment System
- Industrial Estates Development
- Land Titling and Economic Restructuring Activity (LTERA)
- Promoting Sustainable Private Sector Development
- Provision of Technical Advisor to the Ministry of Finance/Treasury
- Rural Finance and Cooperative Development (RUFCOD)
- Strengthening Private Sector through Capacity Building
- Trade Accession and Facilitation for Afghanistan (TAFA)
- Women Enterprise Development (WED)
- Women in Government Internship Program (WIG)
Last updated: April 14, 2014