Monday, June 14, 2010

Resources in Afghanistan!? [updated]

Lots of chatter this morning with multiple FB links to this story about US identifying heaps of mineral sin Afghanistan.  My first reaction was: of course there are lots of minerals because no one has had the chance to really mine the country.  Let me re-phrase that: because of the prevalence of land-mines (IEDs) and on-going violence for the past thirty years, Afghanistan should have abundant mineral deposits. 

Blake Hounsell of has an interesting perspective on the story: the timing and cement.  That is, he ponders whether it is an accident that relatively old news about surveys of resources in Afghanistan is splashed across the front page of the NYT just after a series of bad stories about Afghanistan about which I have been ranting lately.  And then the killer punch--he notes that Afghanistan is so short of any kind of production capacity that it produces fifty times less cement, which is pretty basic stuff, than Pakistan.  If you have to import cement, that suggests trying to dig out lithium might not be either that high of a priority or that likely to happen any time soon.

Of course, this story will feed the conspiracy theorists who focus on pipelines and economic resources as the reasons why NATO and the US are in Afghanistan.  Of course, this is one of the poorest states on the planet, so it completely makes sense that economic imperialism would be driving events..... or not.

The fun thing is that my pessimistic political science friends immediately jump on the resource curse idea--that countries with lots of resources tend not to develop robust institutions.  Why?  Because they do not need to develop taxation systems and then social welfare systems if they can collect money via resources.  The problem with invoking the resource curse argument here is that it is a path dependent process by which a series of decisions and events leave state institutions weak and ineffective, but Afghanistan has already had heaps of path dependent processes that have limited the capacity of the government--heaps of civil war and corruption and abuse of power. 
The corruption that is already rampant in the Karzai government could also be amplified by the new wealth, particularly if a handful of well-connected oligarchs, some with personal ties to the president, gain control of the resources. [NYT]
And given the stories of the past week, this is very much likely to be the outcome. 

So, is this a game-changer?  Not really.  Exploitation of these minerals, even in the absence of war, will take decades.  The biggest benefit might be to the international community as Afghanistan someday might be able to pay for its own government.  It may lead to some rivalry between China and everyone else since China seems to be operating on a longer term strategy of resource security.  These resources may add a bit of fuel to a bunch of fires: the war, the corruption, tensions with China.  But it is not likely to really change the direction of events in the near or medium term.

Of course, I am no expert in minerals, so I could be wrong.  But the resource curse is not thing that comes to mind for me.  Afghanistan is already cursed enough by its past and by its current leadership.

[update]  Ricks has an expert chime in.

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