IFC Encourages Economic Development in Afghanistan
For most of the last four decades, Afghanistan has been embroiled in conflict. That has taken a toll on the country’s infrastructure, institutions, and services.
To help address those challenges, IFC has ramped up its work in the country in recent months, using a combination of investments and advisory services to support Afghanistan’s private sector.
The most recent deal came this month. IFC signed an agreement with one of Afghanistan's leading telecom companies designed to extend access to the internet to scores of people in the poverty-wracked country.
"As we have seen in countless places, the ability to communicate is vital for economic development," said Mouayed Makhlouf, IFC Director for the Middle East and North Africa. "This agreement will help bring the internet to the doorstep of Afghans, opening up a world of possibilities."
The $65 million loan will support the Telecom Development Company, known as Roshan, as it rolls out a 3G network. That is key in a country with virtually no landlines – and no other way for people to get online. The company is also planning to beef up its 2G network, which reaches hundreds of cities. Roshan is owned by the Aga Khan Fund for Economic Development, Monaco Telecom International, and TeliaSonera.
The investment is part of IFC’s wide-ranging strategy in Afghanistan to improve infrastructure, support agribusiness, help small businesses, and promote the development of the financial and telecommunications sectors.
In February, the government, thanks to IFC’s help, launched its first electronic collateral registry. That will make it easier for smaller businesses to get the loans they need to grow and create jobs. IFC’s pioneering investments in Afghanistan’s microfinance sector have also helped boost access to finance. We partnered with the First Microfinance Bank which now has 50,000 borrowers, 16 percent of whom are women. We are also advising the national power utility of Afghanistan on a public private partnership to upgrade the power systems in Kandahar and Helmand provinces.
To improve the country’s investment climate, IFC is working with the Ministry of Commerce and Industry to cut red tape and reduce opportunities for corruption.
IFC is also supporting Afghan farmers. An advisory services project helped 1,500 pomegranate growers improve their farming practices, boosting their incomes by 60 percent. The program also helped link farmers to exporters, which in turn were given support to access new markets.
Meanwhile, IFC’s Business Edge program has trained 2,300 entrepreneurs, including 690 women.
Our total investments in the country stand at $137 million.