The International Trade Center (ITC) believes that Afghanistan has “incredible opportunities” to boost its exports in international markets and balance its “large trade deficit”.
“Afghanistan has an incredible number of opportunities in international trade,” ITC Executive Director Arancha González, said in an interview with EFE (a Spanish news agency).
González believes that Afghanistan has access options to markets such as the European Union (EU), China, India and even the United States and the Afghan-Government has to “translate these opportunities into an improvement of the economic situation on the ground”.
“Afghanistan has a difficult trade situation and a large deficit,” he said, recalling that the Asian country barely exported 723 million dollars in 2017 compared to its imports of 7,065 million dollars.
“Very easily the Government could get the country to export by 1 billion,” he said, noting that with the new measures that are being carried out it is expected that in the next two years it will reach that goal.
In his opinion, “the great challenge” of Afghan exports comes from the fact that many of their raw materials are sold today to neighboring markets, especially Pakistan, where they are processed generating added value.
In this regard, he stressed that Afghanistan must work to process, package and label its products in the country to export directly and thus achieve much more value than the one that reverts the sale of the raw material as such.
Afghanistan has launched a National Export Strategy, the first of its kind, with the aim of improving the climate and business opportunities for Afghan companies and thus be in a better position to increase its participation in regional trade and global.
This initiative, said González, has the support of the European Union and is implemented by ITC, a joint organization of the World Trade Organization and the United Nations.
The new strategy will help the Government in reforms to solve and improve the response to internal problems, simplify the bureaucratic process and customs procedures and facilitate access to financing for merchants.
Another step to increase exports is through the “great potential” in agricultural products, he stressed.
“In processed agricultural products you cannot export to international markets unless you meet internationally recognized quality standards,” he said, noting the need to improve the product quality and establish centers that certify that quality.
He also stressed that Afghanistan, a country that produces nuts, jewelry, precious stones and textiles, could export to the EU within a duty-free quota, under much better conditions than other neighbors such as Pakistan.
“Unfortunately, Afghanistan hardly exports to the EU and is not among the 60 largest trading partners of the EU,” he said.
González believes that currently Afghanistan is very dependent on Pakistan, which has traditionally been the destination of much of the trade, is gradually diminishing as the country is opening new trade routes with Iran and neighboring countries to the north such as Turkmenistan and Uzbekistan.
The country is also increasing its commercial air connectivity with new routes, something to which recent agreements with India, Kazakhstan and Turkey have contributed.
Although Afghanistan does not have direct access to the sea, the head of the ITC does not believe that the Asian nation “is a country enclosed by land”, and on the contrary it can be a “commercial logistic center” for the countries of the region.
He acknowledged that the recent US sanctions on Iran “will have an impact on Afghanistan” because Kabul has opened a commercial corridor with Tehran towards the port of Chabahar, a project in which India is also involved.
“It is sad to see the situation with Iran, but it is even more serious to see Afghanistan become a side effect or a victim of the decision of the United States,” he said.
However, he stressed that many partners and a large number of friendly countries in Afghanistan are defending that the United States exempt Chabahar from sanctions.
In this regard, he stressed that the ITC is willing to “facilitate” the dialogue to help build bridges and encourage the parties to dialogue to overcome the problem of the port of Chabahar.