A Regional Economic Approach to Forging Sustainable Peace in Afghanistan

While the world focuses on Ukraine, Syria, and the potential for a longer-term nuclear deal with Iran, let us not lose sight of Afghanistan at its critical juncture. Following twelve years of significant foreign military and economic investments, the country faces three concurrent transitions in 2014, each fraught with challenges and uncertainty.

First, this past Saturday’s presidential election represents an important milestone in Afghanistan’s political transition. Despite sensational attacks in the run-up to the April 5 election, the Taliban and other anti-government groups failed to disrupt first round voting, a process led and secured by Afghans and their national security forces. The country’s political elite should close ranks and endorse the electoral results provided that the process continues to proceed in a smooth and credible fashion.

Second, a more predictable security transition requires that Afghanistan and the United States sign immediately the Bilateral Security Agreement, which has been under deliberation for more than a year. Fortunately, each of the leading candidates for president has stated publicly his intention to do so.

Finally, after the election, the country’s economic transition will move to center-stage. From high-levels of unemployment and under-employment to a severe dependency on foreign aid for the basic functioning of state institutions, Afghanistan’s multitude of economic shortcomings are complex and seemingly insoluble.

At a “track 1.5” meeting yesterday in Berlin hosted by the EastWest Institute and held at the German Council on Foreign Relations, senior officials from across South and Central Asia – and countries further afield, such as Turkey – signaled a strong willingness to support Afghanistan even as NATO forces pull-back and foreign aid declines. Titled “Reconnecting Afghanistan: Creating Momentum for Regional Economic Security”, the gathering assembled a select group of policy-makers, scholars, and business leaders to review the findings of three regional consultations on Afghanistan over the previous twelve months convened in Istanbul, Islamabad, and New Delhi. I was fortunate to participate on behalf of The Hague Institute.

Though the issues covered were primarily economic in nature, ranging from cross-border trade and transport to harnessing the region’s immense energy and mineral resources, progress in each domain has the potential to reinforce Afghanistan’s political and security transitions too, by increasing incentives and improving the conditions for regional dialogue, trust, and stability.

Beyond elections, Afghanistan’s political transition concerns finding a political solution to the country’s protracted war of more than three decades. Inclusive multi-actor and multi-issue peace negotiations, in fact, tend to result in more durable outcomes, as the parties most affected by the conflict are engaged in finding a way forward through dialogue. Here, regional economic cooperation has much to offer in terms of bringing around the negotiating table many of the key actors involved in the Afghan conflict.

Other insights and unconventional reform ideas discussed, which place a premium on regional business-to-business cooperation, include:

  • Extend the Afghanistan-Pakistan Transit Trade Agreement to both India and Tajikistan to uncork current bilateral implementation bottlenecks.
  • Pioneer 3-4 “Fast Border Crossings” between Afghanistan and its neighbors to demonstrate the immediate commercial and political benefits of streamlined customs with enhanced border security.
  • Build a regional electric grid to connect energy rich Central Asia with energy poor South Asia, while providing the tools for cross-border water management –a source of intense political friction.
  • Join regional energy, transport, and trade through an integrated approach using a planning framework with realistic targets and a mechanism for coordination, monitoring, and sustained follow-through.

For the past decade, my own research has examined the requirements for embedding in Afghanistan effective democratic institutions that facilitate private sector-led growth and job-creation. The normal challenges to market democracy development are compounded in Afghanistan by a distrustful region where, to a large extent, such norms and values have yet to take root and the India-Pakistan rivalry infects otherwise well-meaning regional cooperation initiatives. Consequently, South-Central Asia remains the least integrated collection of adjacent countries worldwide.

At the same time, as a medium-sized, land-locked country, Afghanistan has little choice but to engage its neighbors and, step-by-step, to position itself as a source of – rather than perceived barrier to – regional stability and prosperity. From still limited public revenue streams and profound institutional weaknesses to rugged terrain and a dogged insurgency, the manifold challenges facing Afghanistan’s new President are immense.

A sustained commitment by the United Nations and Western donor partners is welcomed and needed urgently. But if Afghanistan is to persevere and create new opportunities for self-sustaining peace, an even more critical investment involves redoubling efforts to expand cross-border economic relations and nurture a vibrant business community.

The forward-looking dialogue culminating in yesterday’s exchange in Berlin will inform future regional intergovernmental meetings on Afghanistan, including the Regional Economic Cooperation Conference on Afghanistan and the annual Ministerial Meeting of the Istanbul “Heart of Asia Process“, next scheduled for August 29, 2014 in Tianjin, China. The dynamic network forged over the past year is expected to sustain attention on innovative reforms and investments designed to integrate Afghanistan back into South-Central Asia at a critical time in the country’s, and indeed the region’s, history.

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