Editor in Chief: Moh. Reza Huwaida Thursday, March 28th, 2024

Investments must be Encouraged

The trade exhibition, last week, in Kabul has brought positive results for the country and as the result of the event, according to Afghanistan Investment Supporting Agency (AISA), around $2 million worth of contracts have been signed. The contractors include not only national investors but also the businessmen from United States, Turkey, India and United Arab Emirates, who visited the exhibition and some of them agreed to broker deals with Afghan companies. Most of these investors have shown interest in dry fruit, herbal oil, woodcraft, beverage, honey and fresh fruit business. If these sorts of investments are encouraged and pursued in Afghanistan, it would be of great help to its limping economy and can support in establishing reliable business environment.  

The Trade Show last week represented different sectors of Afghan economy and its capability to produce alternatives for the foreign products, which have currently dominated Afghan market. It is really important that Afghan local market must flourish and the business in the country must be encouraged and supported so that Afghanistan will be able to face the economic challenges in the times to come.

At the same time there should be capital support for the new businessmen and entrepreneurs who have the capability and the enthusiasm to pursue business but do not have enough capital to do so. Banks and similar financial institutions can play a key role in this regard. They can provide loans to the investors and can thus support them in starting their businesses and assist Afghan economy in moving towards economic stability. Currently, Export Promotion Agency of Afghanistan reached to an agreement with Afghanistan International Bank and Afghan Rural Finance to provide long-term loans to the investors on lenient conditions and lower interest rates. This agreement is of great importance and similar efforts to support the investors can truly enable Afghan investors pursue their businesses with motivation and ease.    

Businesses play an imperative role within an economy. If within a system there are steady investments and diverse businesses, the system is on a pathway to growth and success. Since the very beginning of human society, human beings have pursued businesses so as to have their necessities satisfied. Throughout human history, businesses have had different forms and features and today have gotten to a very unconventional form. From the barter system to today's progressive era when the businesses are going on online, there has been a sequence of different practices, but the significance of the business has never been lost. The under-developed and developing countries of the world that require establishing robust economic system entail evolution and sustenance of different businesses to a great degree. The authoritative people in such societies have to make sure that the pathway to the businesses is paved properly.

There are some very vital pre-requisites for businesses and investments to grow. Amongst them stability and security play a dominant role. If different systems within a country are stable and there are not major fluctuations every now and then, the ground is said to be ready for the investors and businessmen to jump in and establish their businesses. Businessmen want consistent outcomes from their investments and they abhor seeing political and social changes disturb their businesses. The evil like insecurity also plays major role in discouraging businesses and investments. Different incidents of terrorism and killings compel the businesses to shut down, and frighten the investors to invest. The societies marked with insecurity do not have consumers going to the markets and enjoying the luxury of shopping different products.

Afghanistan is one of the same kinds of country where insecurity and uncertainty have been influencing the economic life to a large extent. Both national and international businessmen are not readily willing to invest in all the sectors and they do not see positive prospects of their businesses. As insecurity and uncertainty have been overwhelmingly influencing the country, the development in the basic infra-structure has been meager.

The doubts and uncertainties of the Afghan market have made the international investors to think thousand times before they take an initiative to start their businesses in the country. Though there are great opportunities in Afghanistan and the country is blessed with different types of mineral and other natural resources, the economic infra-structure has not been able to get enough attention.

Apart from that there are other factors as well that have been influencing the economic system of Afghanistan. The insufficient and unfavorable business laws are also one of the issues affecting Afghan economy. There have to be strong business laws governing the society and controlling the business. The laws should not only safeguard the rights of investors and businessmen but also make sure that the competition within the system is maintained on strong and fair footings. The evils like monopoly based on unfair competition must be tackled with properly and there should be strong bodies that control the prices within the markets, which at the present are non-existent and the businessmen are fixing the rates on their own.

Afghanistan needs to have strong economy so as to survive in post withdrawal era. The international aid and assistance that have been coming to the country for the last years will be diminished and Afghan economy will be tested to a large extent. The country has to start from the basic infra-structure development and have to reach to a stable economy, wherein the businesses are able to function without any fear and inconsistency