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A surge in China-Afghan trade

By Hujjatullah Zia | | Updated: 2019-02-14 17:27
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Trade volume between China and Afghanistan has increased, and both sides continue to show a tendency toward more commercial exchanges. China carries increasing weight for Afghanistan in terms of trade since Sino-Afghan economic ties have grown stronger in recent years.

The Afghanistan-China Air Corridor was opened in November 2018 to intensify bilateral trade between the two countries. Afghanistan is seeking to export pine nuts, the demand for which has increased in the Chinese market, through the corridor.

Afghan president Ashraf Ghani and senior Chinese diplomats attended the inauguration ceremony and said they hope the corridor will be conducive to increased Afghan fruit exports to China, in order to address the trade deficit.

It is estimated that the corridor will enable Afghanistan to export 23,000 tons of pine nuts to the Chinese market annually, while saffron and precious stones will also be also routed to China through the newly opened link.

China is one of Afghanistan’s most significant trading partners, and bilateral trade volume between the two countries reached $544 million in 2017, according to the Chinese ministry of foreign affairs.

China, which has lifted about 800 million people out of poverty within the last 40 years, is able to share the fruit of its economic development with Afghanistan to alleviate poverty. For its part, Afghanistan can offer China the easiest transport route to markets in Central Asia and Europe, and facilitate the Belt and Road Initiative (BRI), with the aim of mutual benefit and win-win cooperation.

“By making the best use of its advantages in geography, resources, demography, connections and international attention and bypassing any disadvantages, Afghanistan may play an active and important role, and make considerable gains, in the development of the BRI,” said Liu Jinsong, Chinese ambassador to Afghanistan.

Dr Zeng Xiangyu, a professor in the Institute of South Asian Studies at Sichuan University, said, regarding China’s investment in Afghanistan, “The Mes Aynak copper mine contract in 2008 is a $4.39 billion business deal. Another major project is the $300 million refinery plant contract on Amu Darya oilfield.”

“I personally,” Zeng said, “visited the Republic Hospital in Kabul, which was developed by a Chinese company.”

He went on to say that China also aided the repair work for the Parwan Irrigation System, the teaching building, hostel, and auditorium in Kabul University, a national vocational training center, highway development in Kunduz-Jalalabad, repair and reconstruction work of the Kabul-Jalalabad and Bamiyan-Samangan highway, and custom building in Torkham.

“Huawei and CTE are also involved in optical-fiber national grid development,” he said.

Director of the Afghan Expo Commission Omer Rahimy, participated at the China International Import Expo in Shanghai, where he featured Afghanistan’s crafts, carpets, precious stones, saffron, and pine nuts.

“Our carpets, saffron and dried fruit are being sold widely in China,” Rahimy said. On the question of whether shipping cargo by air is too costly, he said, “I believe the Afghan chamber of commerce has struck a deal with Turkey and Ariana Airlines recently, whereby 80 percent of shipping costs will be paid by the government and 20 percent by businesspersons. This contract was made with the opening of the air corridor, which is highly fruitful to us.”

This came as Afghan traders complained that imports to China via the railroad connecting the two countries, launched in 2016, was too costly and that tankers shipping Chinese goods to Afghanistan consistently returned without carrying goods from the other side.

Afghanistan is also one of the beneficiaries of China’s opening-up policy. As friendly neighbors, China and Afghanistan have to enhance policy coordination, infrastructural connectivity, unimpeded trade, and financial integration.

Afghanistan recently came in for international attention in terms of trade. In addition to the Afghanistan-China Air Corridor, Afghanistan has opened air corridors with India, Turkey, Kazakhstan, Saudi Arabia, and Indonesia. Efforts are underway to extend air corridors with more countries.

Similarly president Ghani inaugurated the Lapis Lazuli corridor in the Afghan province of Herat in December to boost trade in the region. Reiterating “communication” and “cooperation” with regional countries and Afghanistan’s historical position as “an international crossroads”, Ghani said Afghanistan is the gateway to Caucasus and Europe.

The Lapis Lazuli route connects Afghanistan to Europe via Turkmenistan, Azerbaijan, Georgia and Turkey, and serves as an essential platform for trade among countries in South Asia, Central Asia and Europe. The Lapis Lazuli Agreement was signed on the sidelines of the Regional Economic Cooperation Conference on Afghanistan (RECCA-VII) in November 2017, with the aim of intensifying trade and connectivity in the region.

It is important to analyze the Lapis Lazuli corridor and the Afghanistan-China Air Corridor for achieving inclusive development through trade and transit. Connectivity in Afghanistan can boost the untapped potential in increasing trade with China, South Asia and the entire region, and there are also promising transit routes to be developed under the BRI.

The author is an Afghan journalist and freelance writer.

The opinions expressed here are those of the writer and don't represent the views of China Daily website.


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