Bishkek, K oublic 10-12 May 2004 Conference Report
D Bishkek, Kyrgyz Republic 10 -12 May 2004 AFGHANISTAN
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Foreword Introduction 2 -3 Rethinking Regional Economic Cooperation 4 -7 Afghanistan: the new regional player 8 -9 Trade and Transit 10 -13 Regional Cooperation: the broader context 14 -17 An Agenda for Regional Cooperation 18 -19 The Bishkek Declaration 20 -21 Agenda of the Conference 22 -24
Ministerial Conference 26 -64 Statement by H.E. Askar Akayev, President of the Kyrgyz Republic 26 -31 Statement by Mr. Mark Malloch Brown, Administrator, UNDP 32 -35 Statement by Mr. Mohammad Shariatmadari, Minister of Commerce, Iran 36 -38 Letter from H.E. Nursultan Nazarbaev, President of Kazakhstan 39 Statement by Ms. Zhanar Aitzhanova, Vice Minister of Industry and Trade, Kazakhstan 40 -43 Statement by Mr. Tariq Ikram, Minister of State and Chairman of the Export Promotion 44 -46 Bureau, Pakistan Statement by Mr. Zia ul Haq, Additional Secretary, Economic Affairs Division, Pakistan 47 -48 Statement on behalf of Mr. Soliev, Minister of Economy and Trade, Tajikistan 49 -51 Statement by Mr. Alisher Salahitdinov, Ambassador bf the Republic of Uzbekistan in the Kyrgyz Republic, Head of Delegation, Uzbekistan 52 -55 Statement by Mr. Alastair McKechnie, Country Director for Afghanistan, World Bank 56 -58 Statement by Dr. Frank Polman, Senior Advisor, South Asia Department and Special Representative to Afghanistan, ADB, Philippines 59 -60 Closing Remarks by Mr. Ercan Murat, Country Director, UNDP Afghanistan 61 -64
Experts' Working Group Meeting 65 -70 Opening Speech by Mr. Jerzy Skuratowicz, Resident Representative, UNDP Kyrgyz Republic 65 -66 Opening Speech by Mr. Nikolay Tanaev, Prime Minister, Kyrgyz Republic 67 -70
List of Participants 72 -78 Summaries of discussions 79 -88 Working Group I - 11 May 2004 79-81 Working Group II - 11 May 2004 82-86 Working Group III - 12 May 2004 87-88 We are pleased to introduce this report of the conference "Afghanistan's Regional Economic Cooperation: Central Asia, Iran and Pakistan," held in Bishkek, Kyrgyz Republic in May 2004. We recommend to all readers the conference website (http: / /arec.undp.kg), where the full texts of all conference materials have been gathered for ease of access. When the idea for this conference was first raised in Kabul and Bishkek, the organizers and facilitators hoped that, at the least, it would introduce Afghanistan to Central Asia and provide a venue for Iran and Pakistan to contribute to a new profile for the broad region. It proved able to do this and much more. In the course of three days in May, government delegates from eight countries were able to interact formally and informally, learn from one another and lay a foundation for future relationships. Private -sector actors, many meeting each other for the first time, began the process of doing business across the region. All the conference participants had an opportunity to share their experiences and hopes for the region, and to look forward to greater interaction in the coming months and years. During the conference, not only Afghans but also many regional actors noted that the reconstruction of Afghanistan could, and in some senses already has, become a catalyst for economic dynamism across south, central and west Asia. Such concord is a critical contribution to the security and prosperity of all the countries represented at the conference. Even more, the interaction between the private and public sectors during the conference confirmed the hope of the conference organizers that policy reform within and among participating states can support trade and investment across the region. We can now see concretely how business can help to lead Afghanistan's recovery and, in so doing, spur economic growth among all of Afghanistan's neighbours. We hoped for these conclusions from the start, but it was heartening to see them articulated by so many conference participants in many imaginative ways. Hard work lies ahead of us. As this report makes clear, the political will of ministerial delegates, combined with technical direction offered by policy makers and private - sector participants, now opens new avenues for cooperation across the region. UNDP and its partners in the World Bank and the Asian Development Bank stand ready to assist all participating countries to bring the opportunities identified in this conference to fruition.
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Mr. Ercan Murat Mr. Jerzy Skuratowicz Country Director, UNDP Afghanistan Resident Representative, UNDP Kyrgyz Republic 1 Introduction
On the 10th of May 2004, at the invitation to take full advantage of the economic of Afghanistan's President Hamid Karzai opportunities that reconstruction, and a and the President of the Kyrgyz Republic, renewed Afghanistan, offer to the region. Askar Akaev, delegations from Indeed, Afghanistan's reconstruction, still Afghanistan, Iran, Kazakhstan, the Kyrgyz donor -driven, has thus far been pursued in Republic, Pakistan, Tajikistan, a regional vacuum. The Bishkek Turkmenistan and Uzbekistan gathered in conference represented a regional effort to Bishkek to discuss their future economic bring together key actors whose mutual cooperation. More than 200 people understanding is a prerequisite for attended the three -day conference, Afghanistan's - and the region's - future including ministerial delegates from most development. participating states, regional To this end, the Afghan delegation led representatives of key multilateral discussions on the newly instituted development and financial institutions, procedures governing the national and private- sector actors from across the economy, presented its public investment region. Keynote speeches by the President programme and outlined ongoing reforms of the Kyrgyz Republic, the Administrator to the security sector. of the United Nations Development Programme and the Afghan Ministers of The conference established a platform for Finance and Commerce set the stage for policy transparency among regional actors discussions among national policy makers by encouraging open exchanges of and businesses to establish an agenda of information, policies and experiences. initiatives to strengthen economic ties Discussions were held at both broad -based across the region. as well as technical levels: technical preparatory papers helped expert working The conference was organized to groups to produce detailed introduce to Central Asia, Iran and recommendations to a high -level Pakistan the government and private ministerial meeting. Senior facilitators sector of Afghanistan, and to discuss the were provided by UNDP, the World Bank critical links between economic and the Asian Development Bank to lead cooperation and regional peace and these discussions. stability. The timing of this conference, more than two years after the Bonn The conference also heralded a new era in Agreement that established Afghanistan's public -private dialogue for the region. Far interim government, and just months from being the passive recipients of before Afghanistan will hold its first government directives, business people presidential election, was propitious. from all participating countries played a key role in discussions at the conference. Despite two years of investment in Most countries at the conference have at Afghanistan's ree'ónstruction, many some point publicly str.ted their regional actors remain unaware of the commitment to private -: ector country's reform and reconstruction development as the engine of growth, and agendas, and few regional actors have yet some have adopted strategies to support Introduction
On the 10th of May 2004, at the invitation to take full advantage of the economic of Afghanistan's President Hamid Karzai opportunities that reconstruction, and a and the President of the Kyrgyz Republic, renewed Afghanistan, offer to the region. Askar Akaev, delegations from Indeed, Afghanistan's reconstruction, still Afghanistan, Iran, Kazakhstan, the Kyrgyz donor -driven, has thus far been pursued in Republic, Pakistan, Tajikistan, a regional vacuum. The Bishkek Turkmenistan and Uzbekistan gathered in conference represented a regional effort to Bishkek to discuss their future economic bring together key actors whose mutual cooperation. More than 200 people understanding is a prerequisite for attended the three -day conference, Afghanistan's - and the region's- future including ministerial delegates from most development. participating states, regional To this end, the Afghan delegation led representatives of key multilateral discussions on the newly instituted development and financial institutions, procedures governing the national and private- sector actors from across the economy, presented its public investment region. Keynote speeches by the President programme and outlined ongoing reforms of the Kyrgyz Republic, the Administrator to the security sector. of the United Nations Development Programme and the Afghan Ministers of The conference established a platform for Finance and Commerce set the stage for policy transparency among regional actors discussions among national policy makers by encouraging open exchánges of and businesses to establish an agenda of information, policies and experiences. initiatives to strengthen economic ties Discussions were held at both broad -based across the region. as well as technical levels: technical preparatory papers helped expert working The conference was organized to groups to produce detailed introduce to Central Asia, Iran and recommendations to a high -level Pakistan the government and private ministerial meeting. Senior facilitators sector of Afghanistan, and to discuss the were provided by UNDP, the World Bank critical links between economic and the Asian Development Bank to lead cooperation and regional peace and these discussions. stability. The timing of.this conference, more than two years after the Bonn The conference also heralded a newera in Agreement that established Afghanistan's public -private dialogue for the region. Far interim government, and just months from being the passive recipients of before Afghanistan will hold its first government directives, business people presidential election, was propitious. from all participating countries playeda key role in discussions at the conference. Despite two years of investment in Most countries at the conference have at Afghanistan's reconstruction, many some point publicly styted their regional actors remain unaware of the commitment to private -Lector country's reform and reconstruction development as the engine of growth, and agendas, and few regional actors have yet some have adopted strategies to support and encourage business. At the regional the pro- active engagement of the private level, however, a different set of issues sector and the focused attention of key and policy concerns, involving cross - international organisations. border interstate relations, present In this regard, the conference also built on themselves. For this reason, it was the momentum of the Kabul and Dubai particularly important and productive to declarations of 'good neighbourly hold discussions of trade and economic relations'. In September 2003, Afghanistan cooperation in a forum open to both the and its direct neighbours had signed the public as well as the private sector. Dubai declaration, which insisted on pursuing closer economic ties through the liberalisation of trade regimes in the region. Now, in Bishkek, the region's policy makers and politicians convened to explore this issue in greater detail with the technical support of international institutions and the framework of the Economic Cooperation Organisation. This report looks at the three key themes discussed during the conference: regional economic cooperation and Afghanistan's role as a new regional player; trade, transport and transit facilitation; and broader issues of regional cooperation such as social policy, education and security.
Askar Akaev
As President Askar Akaev indicated in his opening speech, the Bishkek conference was a logical development of the Bonn, Tokyo and Berlin conferences for Afghanistan. Bishkek contributed to previous resolutions the regional perspective, the consensus of Afghanistan's natural long -term partners,
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Conference Report Rethinking Regional Economic Cooperation
Dr. Ashraf Ghani, Minister of Finance, Afghanistan
The conference was founded on the establish transparent and predictable trade lessons learned from other parts of the regimes and a secure investment climate. world that those developing countries that Policies of protection, distortionary increased their integration into the world pricing, foreign- exchange control, import economy over the past two decades have licensing and export restrictions all have worked to reinforce the economic isolation of many of the countries. As a result, intra- regional trade has been weak, economic development slow and investment unforthcoming. However, the region has the potential for huge returns if it can make a relatively small investment in economic cooperation first, and a broad consensus in support of this was made at the conference. Mr. Mark Malloch Brown, UNDP Administrator, outlined the prospects facing the region in his opening remarks: This is a region endowed with abundant natural resources, making it a treasure trove of natural and mineral wealth where reserves of oil and gas in Iran and proven reserves in Kazakhstan and Turkmenistan put these countries among world leaders in oil and gas production and exports. It is a region that could be bound by energy - related links, such as the proposed gas achieved higher income growths and pipelines from Central to South Asia, as longer life expectancies. Countries that well as through possible power purchase pursue non -discriminatory openness to agreements and power grids. Feasibility global trade are more likely to attract the studies being undertaken reveal that the benefits of private investment, both gas pipeline from Turkmenistan, across domestic and foreign. Although largely Afghanistan, to energy -deficit South Asian accepted by the countries that participated markets is expected to carry two billion at the conference, this assumption has not cubic feet of gas per day, yielding large ensured the adoption of strategies to benefits to all participating countries. It has been estimated that the pipeline would cooperation, investment, trade and transit provide a transit income of USD 400 -500 among the neighboring countries of million per year for Afghanistan alone. A Central and Southern Asia, Iran and Pakistan. The Bishkek Declaration Mr. Mark Malloch Brown, in his opening remarks, echoed this idea, saying Central Asia is a large and overlooked market because neighbours do not treat each other as partners. The conference confirmed that cooperation requires a different perspective, one that sees economic interdependence, risk -sharing and openness as opportunities rather than threats. This is the partnership mindset. Dr Ashraf Ghani went on to note: Our collective presence here is an indication of the belief that the key to future prosperity in the region rests on our own decisions, while the Prime Minister of the Kyrgyz Republic defined the conference as a tribune for exchanging opinions and agreeing on mechanisms of multi profile pipeline like this could also have interaction between neighbouring substantive savings per year in energy countries ...for the purposes of assuring costs for both Pakistan and India. peaceful co- existence and progress. This is Tajikistan and Kyrgyzstan are major the essential ingredient of this mindset: the exporters of aluminium and gold, and if will to take collective responsibility for the the hydro potential of these two countries future of the region through participatory can be exploited once the harmonized policy discussions. regulatory framework is in place within The working groups and plenary sessions the region and power trade agreements held over the three days demonstrated the have been signed, Tajikistan and real potential within the region to translate Kyrgyzstan alone could fully satisfy the this idea into action. During the expert hydroelectricity power needs of the region sessions, policy makers shared good and and beyond. bad experiences from their countries with Indeed, taken together, the 300 million the group, covering issues such as welfare people of the countries represented at this policy, refugee return, narcotics and conference have the potential to be one of microfinance. The private sector also the major trading and economic power- proved itself a capable and constructive houses of the world. partner to government in policy discussions. During the high -level plenary A partnership mindset sessions, a strong sense of regional solidarity amongst the ministers and a The participants emphasized that willingness to commit to policy Afghanistan is our natural regional recommendations was evident. partner in the spheres of industrial In this way, the fact of the conference itself was a powerful signal that this key
Conference Report component of cooperation was already in has prompted a review of regional place. relations. Afghanistan embodies all the risks that regional partnership can help As many delegations pointed out, the prevent and all the opportunities that region has already proven itself a very real partner to Afghanistan. After the crisis of regional partnership can promote. 2001, many neighbours advanced towards economic cooperation through the Dialogue facilitation of humanitarian assistance to Afghanistan. Bridges and roads from all Today, one of the most important three northern neighbours were reopened objectives of this conference is io restart after the war to allow assistance through. the dialogue on the critical political, The political will that opened up the economic and development issues borders and facilitated rapid movement of affecting the region, involving goods needed Ibr humanitarian government, the business community and cooperation can now be geared towards civil society in a dialogue that can help economic cooperation, said Afghan develop the strategies required to Minister of Finance Dr. Ashraf Ghani. strengthen co- operation and build the Turkmen Deputy Minister of Foreign regional links that are vital for increasing Affairs Mr. Chary Niyazov echoed this trade, promoting economic growth and sentiment, highlighting in his statement reducing poverty and inequality. Regional that Turkmenistan was moving from mere economic co- operation is critical to shared experience of a difficult history achieving this, and Afghanistan has a towards a "full- fledged partnership" with pivotal part to play in its success. Mr. Afghanistan, a partnership that already Mark Malloch Brown, UNDP consisted of deals to supply the Herat Administrator market with preferentially priced Partnership and cooperation require electricity and the training of healthcare dialogue. The issues tabled at the officials. conference - trade, transit, investment, Other delegates underlined the fact that communication and infrastructure - are partnership was in some instances ones that require iterative review and unavoidable. Both the head of the Uzbek action. Lines of communication among delegation as well as the President of the governments in the region should be kept Kyrgyz Republic highlighted the risks of open and national policy related to these ignoring regional security concerns, a matters should be transparent to regional point also underscored by the UNDP partners. Administrator who, in his opening speech, Throughout the conference, the bilateral said: For all the countries represented at economic commission established this conference, it's clear that your between Afghanistan and Pakistan was destinies are tied both for good and for ill. held up as a model of such dialogue. The The nature of many of the region's commission, it was noted, had established development challenges - shared water, policy transparency and trust such that the narco-trafficking and the spread of sensitive trade issues between the two HIV /AIDS, amongst others - cannot be countries could be discussed and resolved solved at the national level systematically. Pakistan Minister of State alone...regional cooperation is a and Chairman of the Export Promotion necessity, not an option. Bureau Mr. Tariq Ikram announced that It is clear that the 'Afghanistan moment' Pakistan was now deliberating the removal of the six remaining items from mentioned include refugee return, capacity the negative list. This was a direct building of the private sector, teacher response to Afghanistan's simplification of training and social policy. its tariffs. Open dialogue often led directly to The commission has now extended its mutually beneficial decision -makingor, at membership to Iran. During discussions, the least, it sowed the confidence and trust the extension of these commissionsacross that could facilitate such decisions later. the region was recommended. tConclusion Ms. Zhanar Aitzhanova, Kazakh Vice 1 Minister of Industry and Trade, hailed the success of the recent visit of Hamid Fostering a partnership mindset and Karzai, President of Afghanistan, to opening dialogue do not require capitalor Kazakhstan, during which agreements had infrastructure investment; they are free. been reached on commodities trade, Nevertheless, their impact on international including energy supplies, minerals and relations and economic developmentcan agricultural produce. Bilateral discussions be substantial: without them, making were to continue on a ministerial level policy decisions on issues such as trade shortly. would be impossible. The returns, therefore, are extremely attractive. Of The report of Working Group I highlighted course, implementation involves risk, both the benefit of dialogue on a range of issues political and, in some cases, personal. It that the region had in common: In general, also requires confidence and vision. The the Working Group proposed that the actors who came together in Bishkek region undertake regular meetings on mitigated that risk through open specific policy issues and, whenever participatory discussion and multi possible, review the experience of - sectoral relationship building, and therefore participating states related to opened a new chapter in regional politics. reconstruction and recovery. The issues Afghanistan: The New Regional Player
President of Afghanistan, H.E. Hamid Karzai (Berlin Conference, March2004)
The aim of this conference was to introduce this new Afghanistan to a multilateral but regional forum, one whose participants are the natural long -term stakeholders in Afghanistan's success. Up until now, conferences for Afghanistan had taken place in the donor 'heartland'- Bonn, Tokyo and Berlin- and reflected a predominantly donor -driven agenda of reconstruction. In Bishkek, Afghanistan was being discussed in a group that reflected the reality of Afghanistan's geopolitical situation. Afghanistan is at the centre of the region: its problems havç always been the region's problems. Now, however, Afghanistan represents a source of potential and growth for the region. The key to the Dr. Ashraf Ghani, Afghan Minister of success of the conference was timing. Not Finance, outlined the key steps the for many decades has there been such an Government of Afghanistan had taken to opportunity for cooperation and trade move the country towards its goal of being amongst these countries. Now in a regional plàyer: the drawing up of a Afghanistan, a central state exists whose national development programme; the capacity to negotiate, agree and enforce raising of the requisite funds from the bilateral and multilateral agreements with international partners toward a its neighbours is increasing daily. In short: government workplan; and financial Afghanistan is open for business, as the reforms such as the replacement of the Afghan Minister of Commerce Mr. Sayed currency, central banking laws, Mustafa Kazemi said in his opening commitment to a single treasury account remarks. and overhaul of the national system of budgeting and expenditure. Minister secure, efficient and economically viable Ghani also outlined a five -year plan transport corridors passing through the including the reform of the customs country. The international transport service and the newly implemented corridors will not only promote regional simplification of the tariff regime. trade but also international trade, with the These reforms were widely recognised as seaports in Iran and Pakistan providing important achievements. The need for the outlets and inlets for goods, minerals, good governance and democratic elections freight, gas, oil and human resources. The according to the constitution were also corridors will also give an impetus to the raised as important factors of economic much needed growth of the power sector success. with routes of the supplies being better defined and along shorter distances. However, the key to Afghanistan's new regional role lies in its re- exposure of Conclusion long -lost trade and transit routes. Minister Ashraf Ghani summarised this aspect for What the conference clearly established the conference: For over two decades, the was that it was in the interest of all road network in Afghanistan was being participating countries to support the destroyed, drastically increasing the ongoing efforts to reconstitute a stable and distance between independent Central prosperous Afghanistan. The World Bank Asia, Iran and Pakistan. Today, we have supported this view in its technical paper embarked on an ambitious program of "Trade and Regional Cooperation between restoring and expanding our transport Afghanistan and its Neighbours ": Its network. We have obtained the necessary [Afghanistan's] neighbours share an funds to complete the arterial ring road as obvious interest in Afghanistan's renewed well as the spokes connecting it to our prosperity, since a reconstruction that puts neighbours. Simultaneously, Pakistan and strong emphasis on rebuilding physical Iran both have initiated ambitious projects infrastructure has the potential to of new ports and roads that would stimulate trade in the region and foster considerably shorten the distance and economic growth. This is true not simply time between Afghanistan and the Gulf because its neighbours will be able to use With the completion of the ring road, our its highways for trade but also because three neighbouring Central Asian capitals Afghanistan's reconstruction process would be a maximum of 32 hours from the itself should...provide opportunities for Gulf The Afghan Government and neighbouring countries to supply business community are keen to facilitate construction materials and services transactions between and among all our needed to rebuild the country. Whichever immediate and near neighbours. way you look at it, Afghanistan is a new The technical paper for Working Group regional player that - with support- could III, entitled "Afghanistan's Transit and act as a catalyst for regional economic Transport Infrastructure ", presented a recovery. detailed account of the regional transit corridors emerging as a result of Afghanistan's infrastructure programmes. The paper concluded: Afghanistan, therefore, has the potential to become the hub centre of all trade and transport activities for the region and provide Trade and Transit
H.E.. Ashraf Ghani, Minister of Finance, Afghanistan
Trade and transit are the pillars of tariffs. Although studies show that non - potential economic development for tariff barriers are more harmful to trade, Afghanistan and the region. The governments in the region were conference therefore devoted much time encouraged to explore regimes that were and effort to the discussion of the issues more in line with economic realities. It surrounding these pillars. Working Group was noted that multilateral and bilateral II was devoted to the issues surrounding fora are effective mechanisms to trade policy, facilitation and promotion, coordinate policy step- changes. Bilateral while Working Group III was devoted to agreements were seen as particularly the issues of transit and transport effective in dealing with tax -related infrastructure. questions and trade negative lists such as that between Afghanistan and Pakistan, Trade policy which have benefited from intense C l bilateral scrutiny. ECO: The Economic Cooperation Organisation (ECO) is an existing Private- sector monitoring intergovernmental framework with the of trade policy reform mandate to coordinate efforts to facilitate greater trade. It is clear that with the re- The implementation of the existing trade emergence of Afghanistan in the regional and investment agreements was seen as economy, ECO could become a very insufficient. The private sector has an relevant and effective organisation in the interest in implementing trade and region. ECO provides policy makers the investment reform and should mobilise to benefit of an established framework, secure results. Report of Working Group II meaning commitments can be more than All three working groups benefited from pro forma gestures. However, as Working the input of the private- sector participants Group II noted, relevance and respect are at the conference. At all levels of the dependant on the timely ratification and conference, the development of the private implementation of existing and planned sectorwasseen as the key driver of ECO agreements. To this end, all agreed regional economic development. Both to leverage the framework that ECO international financial institutions provided. underscored this theme in their statements, the ADB noting that the private sector's Tariffs:Many of the countries participating in the conference are participation is a real value addition landlocked, meaning that trade should be feature of this conference. Dr. Ashraf the lifeblood of their economies. And yet Ghani, Minister of Finance of many pursue autarky through prohibitive Afghanistan, also mentioned in his opening remarks that the region's future constructive private public partnership. progress and prosperity were contingent Mr. Tariq Ikram, Pakistan's head of on its ability to attract the investments of delegation, welcomed the presence of the private sector. such a strong private- sector delegation and A crucial role for the private sector was noted the importance of enabling business identified in Working Groups II and III. leaders to become stakeholders in regional Both groups proposed that the private policy- making. sector in the region collectively organise Both the World Bank and the Asian itself to monitor the implementation of Development Bank noted in their official public- sector agreements in the area of statements that the conference represented trade. a landmark in public -private dialogue in Such a role would leverage the incentives the region. The Asian Development Bank of the private sector to make the public encouraged delegates to foster this sector more accountable and the constructive dialogue, which as we know implementation of its agreements more from the Asian experience is a necessary effective. The report of Working Group II condition for rapid growth and poverty states that the implementation of trade and reduction. investment agreements, both multilateral and bilateral, was slow and insufficient. Trade facilitation Meanwhile, the impact of such agreements on, for example, time taken at Visas for businesspeople:Within the border points, visa processing or A -to -B trade facilitation discussions, the question journey sections was scarcely monitored. of visas for business people emerged as a It was noted that the role of the Afghan result of the private sector's participation private sector in monitoring such practical at the talks. Existing procedures were aspects of trade between Pakistan and described as too cumbersome to serve the Afghanistan had played a role in the liberalisation of trade between the countries. A regional approach may extend this method systematically across all participating countries. It was proposed that such monitoring missions be carried out under the aegis of the ECO Chambers of Commerce, with technical or financial support from the international community. The missions would be launched regularly and would report both to the national governments as well as to ECO. The proposal had significant support: Mr. Alastair McKechnie of the World Bank said: I strongly endorse the proposal that the private sector monitor tráns]hort times and costs, while the head of thAÁDB delegation, Mr. Frank Polman, said this will help us ensure satisfactory advance in such projects and be a good example of
conference Report needs of the private sector. The working Trade promotion:Trade promotion was groups launched a plea for liberalised visa also identified as an area that required regulations as well as faster and more regional cooperation. Mechanisms streamlined procedures for visa issuance. discussed include information exchange, The private sector outlined its target: the trade corridors, international organisations standardisation of multiple -entry, one -year and public -private partnerships. The grave visas, issued against information provided lack of information available to the private by national chambers of commerce. Once sector was consistently noted as a key again, ECO was suggested as a potential constraint to greater trade. In particular, policy advocate at its next ministerial the key aspects of countries' regulatory meeting, while the ECO Chambers of regimes should be made available, Commerce might help to coordinate including laws of investment, investment information gathering amongst national guarantee schemes, land titles and credit. chambers. It was suggested that a working In Afghanistan's case, the Afghan group of officials and private- sector actors Investment Support Agency should be be established to iron out remaining promoted as the natural disseminator of issues. this information, but should cooperate with counterpart institutions in the region Transit corridors:It was noted that transit to ensure that knowledge is actively corridors are the potential driving force of shared. International efforts such as the regional trade, given their ability to lower International Trade Centre's (ITC) the costs of trade between the central information exchange project and ADB Asian republics and the warm water ports Trade Information Centres were of Iran and Pakistan or the markets of highlighted. However, it was felt that the south Asia. Such corridors, to the extent newly revived ECO Chambers of that they will use Afghanistan's Commerce could play a sustainable role in rehabilitated ring road, will also result in the exchange of information on trade and increased domestic revenue generation in investment opportunities. Afghanistan and small- and medium -sized enterprise development along their routes. Private -sector development:Iran's As considerable public investments are Minister of Commerce, Mr. Mohammad made on these ambitious projects, it is Shariatmadari, mentioned specifically crucial that governments simultaneously during plenary discussions the role of the act to harmonise regulatory environments private sector in investment. Together with and simplify border procedures. Localised trade, investment is a driver of economic successes can be used as best practices for growth, ensuring economic integration, the region, thereby accelerating the rate of technology transfer and the efficient use information exchange. of capital. However, in countries like Working Group II recommended that Afghanistan, political and commercial risk multilateral working groups be formed to can dissuade investors, frustrating a tackle issues in this area, given the high potential source of foreign capital. Mr level of interest by all participating Shariatmadari therefore proposed a countries in the speedy implementation of commercial risk guarantee fund for corridor agreements, the solving of Afghanistan to parallel the World Bank's regulatory problems surrounding corridor MIGA fund, which guarantees investors creation and the investment required for against political risk. Iran, he said, would the infrastructure of corridors. be ready to commit start -up capital for the fund and would help Afghanistan raise activities, it was noted, may best be carried out within the framework of United Nations agencies.
Conclusion
The region has made considerable progress in the areas of trade and transit over the past years. The development of the warm water ports of Chabahar, Bandar Abbas and Gwadar in Iran and Pakistan, together with the expanding network of highways throughout the Central Asian republics, have set a course for sustainable economic growth. Afghanistan, together with its international partners, is working to complete its ring road and the regional further capital from the region and connections that will facilitate both the international donors. internal movement of goods as well as Pakistan's Minister of State, and Chairman regional transit. On the policy level there of the Export Promotion Bureau, Mr. Tariq has also been evidence of a growing Ikram, echoed this proposal in his willingness to discuss regional trade and statement, noting that: the concern for mechanisms for liberalisation. security of capital and returns... In Bishkek, the presence of the business undermines quicker exploitation of the community encouraged a practical potential that this region offers. He discussion of trade logistics, educating proposed a taskforce of governmental many in the public sector on the real actors from the region combined with issues facing the development of trade in international financial institutions and the region. Its recommendations are likely donors to look at mechanisms to minimise to forge great inroads into the investor risk. liberalisation of trade in the region. This The Iranian Commerce Minister also conference also highlighted the impressive highlighted the importance of building the returns to the whole region that policy private sector's capacity across the region. decisions can yield. However, these Businesses still lack basic skills such as decisions can only be taken when the business -plan writing, project finance and region cooperates to find mutual solutions. administration. He suggested that Iran support efforts in Afghanistan to strengthen these skills systematically, through training or workshops. Such
Lontrec.;_,_f Regional Cooperation-The Broader Context
UNDP Administrator Mr. Mark Malloch Brown
Social policy, capacity building and communications are all central to the Capacity building sustainability of economic development in the region. They are also areas in which The group went on to explore the potential the regional partners are well suited to for investment in human -capacity collaborate and cooperate. The conference development, in particular where the in Bishkek encouraged policy makers to benefits could be realised regionally. take a broader view of sustainable Refugee repatriation affects almost all of economic development. the participating countries. The groupwas interested in exploring the positive Regional social policy externalities of refugees, noting their ability to add to economic output, investment in people is a basic pillar of diversify skill -sets and contribute tocross - any country's social policy. Delegates at border social understanding. However, this conference discussed the potential for such externalities are available to the state a regional social policy. Such an initiative only once it invests in the proper treatment would need a statistical base that enables of this social group. The social policy- makers to make comparisons, dysfunction that can result from identify priority areas and draw on shared disinvestment is well understood in the experiences or best practices. A useful region. It was therefore felt that a regional framework for formulating goals already approach would avoid the duplication of exists in the form of the United Nations mistakes while leveraging potentially Millennium Development Goals, and positive social outcomes. Proposals many of the participating countries have already undertaken, with UNDP's support, to compile a MDG report. Likewise, human development indicators have been developed by the UNDP and formalised into reports. The only missing link is to formalise a regional approach to formulate and analyse the data. Such an approach was a key recommendation both to the participating governments as well as to the international community. UZBEKISTAN
TURKMENISTAN
PAKISTAN
include vocational training programmes Resource sharing for regional for refugees, pre- repatriation; a regional development was one of the key commission to promote the free migration imperatives of the conference. The of labour where there is an economic and Government of Afghanistan felt that donor social case; the inclusion of women in assistance led to too much dependence on reconstruction efforts and linking training countries outside Afghanistan's ordinary to all investments. neighbourhood, a situation that may limit Cross -border training of professionals was sustainability in the long term. It is now also mentioned later during the plenary time to source human resources from the session by the head of Tajikistan's region, such as engineers, doctors, delegation. Such training of Afghan teachers, business professionals, labour agricultural, medical and technical higher- force trainers and legal workers. education students in Tajik institutions has Afghanistan needs to develop its own a long history, and could be used to experts in all these fields and may be able develop regular programmes to leverage to leverage training from the region. Iran the two countries' shared language and and Pakistan have already providedsome cultural backgrounds. training for Afghan customs officials, for engineers and in healthcare. When linked More formally, a proposal was made to to an investment, such initiatives have include Afghanistan in regional efforts to been found to both increase the returns for share resources for higher education. The the investor as well as have positive Central Asian Association of Universities externalities for the community in which has harnessed information technology for the training occurs. the benefit of university students and professors, and the dean of the association The Government of Afghanistan proposed proposed that Afghanistan also benefit at the conference that an evaluation be from this network. undertaken into the technical expertise in
CCilfererl<'é? Repon- the region. Coordinated through the diffused and less quantifiable in the short UNDP offices in the region and supported term. Furthermore, although cooperation by other partner organisations, the offers considerable returns to the region as evaluation could facilitate increased local a whole, these may be insufficient at the contracting, partnerships and sharing of national level to prompt action. resources. It would also serve to establish Dr. Ashraf Ghani, Afghan Minister of transparent quality controls by setting Finance, in a memo written for Working standards and benchmarks that could be Group I, set out the principles to guide international organisations toward effective regional activities: Rethink institutional borders to eliminate old organizational thinking. 4 Often, unrealistic bureaucratic divisions within the international institutions themselves - for example, between departments in charge of South Asia or Central Asia - will prevent effective cross -regional actions. Broader used in tender processes across the region. regional initiatives can help bridge these Cross -border regional contracting has divides. been frustrated largely by a lack of Rethink alternative models for regional information, on both the supply as well as the demand sides. This has led to a situation where private- sector development has been held back as regional operators get overlooked in favour of contractors from Central and Western Europe or the United States. Working Group I recommended that UNDP take a pro- active approach in creating an open communications environment that would, among other things, disseminate procurement information throughout the region. development and present options, not Role of international dictation. organisations Regional policy must be owned by the The socio- economic dimensions of region, not driven from outside. regional cooperation may require a greater Institutions can add value by consolidating degree of intervention by international options and best practices taken from their bodies such as UNDP, the Asian accumulated experience in other regions. Development Bank and the World Bank, The UNDP, the World Bank and the Asian along with national non -governmental Development Bank convened in Bishkek organisations. The reasons for this are that to provide exactly this service to regional the returns to investment in people, though policy makers. substantial in the long term, are often 4 Facilitate policy as honest brokers for - realistic, result- oriented, sound All likewise require a regional, economic policies that are mutually cooperative approach. But what is often beneficial and non -threatening for the neglected is the part that social policy has region. to play in achieving these ends. Access to 4 Multilateral organisationscan act to education, healthcare, micro -finance and build confidence at national levels. They the means of communication are together can, as at Bishkek, convene actors who the bedrock of economic development, may not otherwise have the chance to ensuring both an educated and healthy familiarise themselves with one another's supply of labour as well as the demand for policies, and they can create an goods and services. States that provide atmosphere of accountability and these public goods nationally can leverage the expertise and resources available transparency in which decisions can be facilitated. internationally, from both neighbours as well as supporting institutions. Bishkek 4 Provide a broad, regional perspective proved that it was not just in the areas of to policy makers. This is the perspective trade and transit that the region needs to that reflects the returns not felt at the cooperate in order to get things right. The national level, the positive externalities of agenda for regional cooperation requiresa cooperation that are overlooked when broader context if it is to work. states act only on national agendas. LConclusion
Private -sector development, growth and trade, consolidátion of the security situation: all quite rightly hold the attention of policy makers in the region.
Conference Report An Agenda for Regional Cooperation
Mr. Ercan Murat, Country Director UNDP Afghanistan Regional cooperation and Afghanistan as I AREA 1 a new regional player
4 Strengthen regional institutions to accelerate economic cooperation; 4 Expand opportunities for regional policy discussions, through conferences on energy, power, water sharing, riparian rights, etc; Extend multilateral discussions and harmonize bilateral discussions across the region; -Create new joint economic commissions and broaden their reach across the region; 4 Enhance communication in region, ensuring free flow of information.
AREA 2 Trade, transport and transit
4 Create policy instruments to assist countries in their implementation of regional agreements and reinforce the implementation of ECO trade agreements; 4 Enhance information exchange on trade and procurement opportunities and promote private- sector direct interaction in the region; 4 Provide investment guarantees and risk insurances to attract private investment to the region; Promote private -public partnership to make the regional chambers of commerce regulating bodies of public- sector agreements; 4 Continue efforts to harmonise customs; 4 Streamline visa procedures for business people; 4 Resolve regulatory issues around corridors and transit and focus on the two transit corridors as models in cross- border agreements; 4 Improve border control and create joint border points; 4 Facilitate the creation of regional transport companies and overall improvement of transport infrastructure.
AREA 3 Socio -economic cooperation
4 Enhance regional cooperation in achieving MDGs: compile regional indicators and build capacity for regional social policy and human development analysis; 4 Ensure regional problems, such as refugee return and drugs are addressed regionally; 4 Evaluate technical skills available in the region, consolidate support for capacity building in Afghanistan and broaden the involvement of regional expertise and capacity for reconstruction in Afghanistan; 4 Explore options for effective networking and resource sharing among educational institutes. The Bishkek Declaration
We, the participants of the international conference "Afghanistan and Regional Economic Cooperation: Central Asia, Iran and Pakistan ", representing governments and business groups of our countries,
Giving high praise to the emerging positive developments in the process of post - conflict revitalization of Afghanistan, including the adoption of the Constitution, revival of a functioning national government, strengthened domestic political stability, and steps undertaken to reconstruct the economy and infrastructure;
Expressing the hope that the universal presidential and parliamentary elections scheduled to take place in Autumn 2004 in Afghanistan will lay a solid foundation for institutional transformations, effective governance and democratic development;
Noting In particular that the rehabilitation of Afghanistan's livelihoods, the securing of peace and security on its territory, the development of a national economy and state governance institutions open new perspectives and opportunities for the entire region;
Welcoin ing the active and important contributions of the international community towards the reconstruction of Afghanistan and its regional and global integration, including the recent pledges of donor countries for USD 8.2 billion to Afghanistan, made on the basis of the results of the Berlin Conference (2004); Reconfirming continuity of decisions of three previous conferences on Afghanistan - in Bonn (2001), Tokyo (2002) and Berlin (2004) - as well the Kabul Declaration of Good -Neighborly Relations (2002) and the Dubai Declaration on the promotion of closer cooperation in the spheres of trade, transit and investments (2003);
Recognizing the central and leading role of the United Nations and the Government of Afghanistan in organizing international assistance to the Afghan people and for the reconstruction of the country;
Hereby note that the progress achieved to stabilize the national political life in Afghanistan highlights the challenge for economic and social progress;
Hereby note that economic cooperation among Afghanistan's neighbors will accelerate Afghanistan's recovery, bring stability to the region and provide a basis for the pursuit of common economic interests of the whole region;
Emphasize that Afghanistan is our natural regional partner in the spheres of industrial cooperation, investment, trade and transit among the neighboring countries of Central and Southern Asia, Iran and Pakistan; Highlight the importance of Afghanistan's policies toensure secure transit trade with all of its neighbors and the need to harmonize the legislation of Central Asian states, Iran, Pakistan and Afghanistan in that sphere;
Reconfirm our readiness to participate in programs for the reconstruction of Afghanistan, to provide humanitarian, technical and consultative assistance in various areas and to facilitate private- sector initiatives;
Hereby note in particular fruitful discussions on the background for sustainable economic development, including transit and transport infrastructure, trade and investment policies, communications and energy distribution;
Underlining the role of the private sector in expanding economic cooperation and the reconstruction of Afghanistan;
We call JOY" support of this sector through the establishment of export and investment guarantee funds by donor countries to Afghanistan;
Urge donor states, international financial institutions and humanitarian organizations to increase their participation in the comprehensive revival of the Afghan state;
Express gratitude to the Government of the Kyrgyz Republic, the United Nations Development Program, the World Bank and the Asian Development Bank for holding that important conference, organized with the purpose of active promotion of regional development regarding proclaimed tasks and goals;
Deem it important to bring this Declaration to the notice of the United Nations. Agenda of the Conference
Monday 10th May 2004
08:30 - 09:00Registration Venue: Hyatt Regency Hotel
09:00 - 09:30Plenary opening session Co- Chairs: Mr. Ercan Murat, Country Director, UNDP Afghanistan Mr. Jerzy Skuratowicz, Resident Representative, UNDP Kyrgyz Republic
09:00 - 09:15 Introduction and welcome addressed by Mr. Jerzy Skuratowicz 09:15 - 09:30 addressed by Mr. Nikolay Tanaev, Prime Minister, Kyrgyz Republic
09:30 - 10:15Plenary session Short introductory presentations by heads of country delegations
10:15 - 10:45Tea and coffee
10:45 - 12:00Plenary session Introductory presentations by Working Group Facilitators
12:15 - 14:00Lunch
14:00 - 15:30Working Groups (WG) WG 1 - Afghanistan as a new regional player Session I (parallel meetings) WG2 - Trade policy and trade facilitations WG3 - Transit and transport infrastructure
15:30 - 16:00Tea and coffee
16:00 - 17:00 Working Groups WG 1 - Afghanistan as a new regional player Session I continued WG2 - Trade policy and trade facilitations WG3 - Transit and transport infrastructure
17:30 Dinner Hosted by UNDP Tuesday 11 th May 2004
09:00 - 10:30Working Groups WG1 - Afghanistan as a new regional player Session II (parallel meetings)WG2 - Trade policy and trade facilitations WG3 - Transit and transport infrastructure
10:30 - 11:00Tea and coffee
11:00 - 12:00 Working Groups (WG) WG 1 - Afghanistan as a new regional player Session II continued WG2 - Trade policy and trade facilitations WG3 - Transit and transport infrastructure
12:15 - 14:00Lunch
14:00 - 16:00 Working Groups (WG) WG 1 - Afghanistan as a new regional player Session III (parallel meetings) WG2- Trade policy and trade facilitations WG3 - Transit and transport infrastructure
16:00 - 17:00 Tea and coffee
17:00 - 17:30 Plenary session Reports by Working Group Rapporteurs. Mr. Joomart Otorbaev, Deputy Prime Minister, Kyrgyz Republic
18:00 Private -sector meeting followed by reception for private- participants, hosted by UNDP Wednesday 12th May 2004
09:00 - 09:45 Opening remarks Chair: H.E. Nikolay Tanaev, Prime Minister, Kyrgyz Republic
09:00 - 09:15 H.E. Askar Akaev, President of the Kyrgyz Republic
09:15 - 09:30 Mr. Mark Malloch Brown, UNDP Administrator
09:30 - 09:45 H.E. Ashraf Ghani, Minister of Finance, Afghanistan
09:45- 10:00 Photo opportunity
10:00- 10:30 Tea and coffee
10:30- 12:00 Plenary discussion Statements by heads of delegations Consolidated report of the expert WG
12:15- 14:00 Lunch
14:00- 15:15 Plenary session Delegation statements on the report of the expert Working Groups Discussion in plenary
15:15- 15:45 Tea and coffee
15:45- 17:30 Plenary session Presentation of the Bishkek Joint Ministerial Declaration Adoption of the Bishkek Joint Ministerial Declaration
17:30- 18:00 Closing remarks Mr. Ercan Murat, Country Director, UNDP Afghanistan
18:00- 18:45 Press conference
19:30 Reception hosted by the Kyrgyz Republic trom 11.;; 1.0, dE Ministerial Conference
Statement by H.Askar Akaev, l'rC,,idcxnt of the Kvfgv_ Republic
Distinguished Mr. Chairman, Distinguished UNDP Administrator, Mr. Malloch Brown, Distinguished Heads of the Delegations, Distinguished Guests, Ladies and Gentlemen,
First of all, I would like to express my sincere gratitudeto the UNDP Resident Representatives Mr. Jerzy Skuratowicz in the Kyrgyz Republic andour old friend Mr. Ercan Murat in Afghanistan fbr organizing the Bishkek conference.Participation of the UNDP Administrator Mr Malloch Brown highlights thestrong importance and responsibility of this forum. Taking this opportunity, I would liketo praise the extremely fruitful activity of UNDP aimed at the implementation of UNDPspecial programs on rehabilitating and reviving the economy of Afghanistan. I wouldpersonally wish you every success in your charitable mission.
I would also like to welcome representatives of the national delegationsof the Central Asian countries, Afghanistan, Pakistan and Iran, internationalorganizations and businesses that supported the initiatives of carrying out thisvery important international forum in Bishkek.
Of course I would like to highlight the key role of Iran and Pakistanin regulating the situation in Afghanistan by providing economic and humanitarianassistance to the country, in addition to receiving and facilitating refugees from Afghanistan. Obviously, these two countries were the first to feel the burden and tragedy of thecivil war in Afghanistan.
Once again, the issues of the post -conflict development of Afghanistanand the involvement of the country in regional cooperation with Central Asia andneighboring countries are vital for the countries of our region. Esteemed Ladies and Gentlemen,
We all have common goals: to promote the return of Afghanistaninto the regional economy, to support the rehabilitation process in the country, to build stable lives for the Afghan people and to achieve stability and security for Afghanistanand the entire Central Asian region.
For the Kyrgyz Republic, as well as all the countries neighboring Afghanistan, peace and stability in this country are vitally important. For many years, Afghanistan was a constant threat to the stability and security of our region. International terrorism, extremism and illegal drug and arms trafficking were continuously threatening the country. The Kyrgyz Republic has actually experienced the seriousness of these threats in the past. Twice, in 1999 and 2000, the territory of our country was subject to invasion by bandit groups based in Afghanistan. Through the territory of the Kyrgyz Republic, they tried to reach the Ferghana Valley for the purpose of setting up a caliphate in Central Asia. The armed forces of our country rebuffed the terrorists at the cost of several Kyrgyz soldiers. It is hard to say how events would have developed without the tragic events of the 11th of September 2001 and the following "Enduring Freedom" anti -terrorist campaign. The Kyrgyz Republic was one of the first countries to declare its readiness to support the efforts of the international anti -terrorist coalition in its courageous effort to combat international terrorism. Without hesitation or delay, we offered our international Manas Airport for utilization by anti -terrorist forces. We are proud that the Ghansy Air Force Base actually became our practical contribution in the joint efforts and that this air base played an important role in destroying the military infrastructure of the Taliban and the Al Qaeda terrorist organization in Afghanistan. The Kyrgyz Republic has been taking an active part in providing humanitarian aid to the people of Afghanistan. Humanitarian goods are delivered to the northern areas of Afghanistan in Kyrgyz trucks through the territory of the Kyrgyz Republic, along the Osh- Khorog- Faizabad road. At the moment, more than 20,000 tons of goods have already been delivered through this humanitarian corridor. Distinguished participants of the conference, The reforms in Afghanistan, brought to ruin by the longstanding war, started after the temporary government, headed by ILE. Hamid Karzai, came to power. The past period revealed the range of difficulties related to the rehabilitation process in Afghanistan. In this regard, I would like to wish the people of Afghanistan and the government of the country to be firm and patient. We are intending to continuously support the efforts of the government of Afghanistan in carrying out the reforms aimed at setting up a peaceful and democratic country. Considerable progress has been achieved in Afghanistan. The Constitution of the country was passed and general elections to the parliament and presidential electionswill take place in October 2004. The Kyrgyz Republic has been welcoming the efforts of President' Karzai aimed at setting up a basis for a functional democracy in the country, concrete steps in implementing the national development plan of the country and speeding up the process of demilitarization and disarmament. They are all creating favorablegrounds for strengthening Afghan statehood and establishing peace and transnational consent, as well as the economic revival of the country. However, in spite of the progress achieved in promoting the political process in Afghanistan, there is still the threat of a revival from extremists and terrorists, all of whom are opposing the reforms. The recent increase in terrorist and extremist attacks on peacemaking forces and aid workers has created widespread concern. Alongside security issues, another aim of the world community is the minimization of threats related to drugs. Unfortunately, during the last year production of opium has increased dramatically. Accordingly, the volume of drug trafficking has also increased, especially through the so- called "northern corridor," via Central Asia. The increasing drug threat requires further consolidation of international efforts aimed at combating this evil. The Kyrgyz Republic has been actively cooperating with the interested countries and international organizations for the purpose of strengthening mechanisms to prevent drug trafficking. The state drug control agency, set up in June 2003 in the Kyrgyz Republic with the direct support of the UN Drug Control Department, is aimed at qualitative actions against drug trafficking and it will operate in close cooperation with all the interested parties. The Kyrgyz Republic is promoting full mobilization of institutional, international, regional and sub -regional agencies for the purposes of implementing the anti -drug strategy applicable to Afghanistan, as well as in a wider regional context. Special attention should be paid to the need to support the people of Afghanistan by providing alternative ways of gaining income. The economic part of the rehabilitation process is, of course, a key condition for achieving a positive shift in the mentality of the people ofAfghanistan. Distinguished heads of the delegations, Dear Ladies and Gentlemen, At the Afghanistan conference held in Berlin, a retrospective assessment of achievements in Afghanistan after the Tokyo and Bonn international conferences was made anda declaration was adopted. The declaration highlights the determination of the world community to create the conditions for the rehabilitation process in Afghanistan. It is designed to promote the establishment of a representative government ina secure and peaceful environment by means offree and fair elections and an independent resolution of its political future. In the future it seeks to provide a guideline for the rehabilitation and revival of the country on the basis of reforms in political, economic and socialareas. The Berlin declaration expresses its dedication to provide financial assistance to Afghanistan for the purpose of its rehabilitation and development; it also welcomes the promotion of regional cooperation between Afghanistan and its neighbours in their fight against drugs. Within this context, our conference represents a logical development of decisions of the Tokyo, Bonn and Berlin forums and is aimed at considering concrete tasks related to the rehabilitation process of Afghanistan through the prism of regional cooperation. We all are very much keen to preserve and strengthen the attention of the world community on the problems of Afghanistan and to foster support for its peaceful and stable revival.
The process of stabilization and strengthening of state power directly depends on the speed and methods of resolving the social and economic problems in this country. Today the fate of the entire nation depends on the joint efforts of the world community. No peace can be achieved in Afghanistan without its economic growth and further development. Combating poverty, drug trafficking and drug addiction will provide for more sustainable progression of the rehabilitation processes. Of course, success depends on the willingness of the political powers and the entire multi- ethnic people of Afghanistan to participate in the rehabilitation and revival of their country. A decisive, factor for implementation of the actual programs is adherence of the main donor countries - the USA, Germany, Japan, EU and other countries of the world community - to the commitments they have made. An important role in promoting and assisting the rehabilitation process can and must be played by Afghanistan's neighbouring countries, including the Kyrgyz Republic. Our leaders are following this line firmly and invariably. In this respect, the Kyrgyz Republic appreciates the efforts of its Afghanistan neighbours Iran, Pakistan, the Peoples' Republic of China, Tajikistan, Turkmenistan and Uzbekistan, which have signed the Kabul (2002) and Dubai (2003) declarations on good neighbourly relations. These declarations encourage closer trade, commercial, transit and investment cooperation. They will promote the implementation of the required measures aimed at the rehabilitation of economic regional cooperation. This conference is the Kyrgyz contribution to the stimulating and strengthening of regional cooperation. Dear participants of the conference, I. familiarized myself very carefully and attentively with the expert materials prepared for this conférence. Important aspects involving Afghanistan in regional economic cooperation are covered in the documents. I am confident that they adequately reflect the essence of the actual problems and outline ways for their resolution. The documents disclose numerous opportunities for forging partnerships and interactions at the regional level. I would like to urge all the interested international organizations and donor countries to use the capacity of our region more fully and efficiently for the purpose of reviving Afghanistan. The countries of Central Asia have tremendous resources: water and energy, hydro - carbonaceous fuel, non-ferrous metals, a network of transport communications, etc. In the future we will have large opportunities to develop multi profile projects together with Afghanistan in various areas: the water and energy sector, agriculture, trade, construction of trans -Asia transport communications, opening joint industrial enterprises, etc. For these purposes we have a favorable geographic location and strong historical links both culturally and spiritually. In addition, prices for many goods and services in the countries of the region are much lower than the ones in the world market. As for concrete participation of our country in the implementation of different rehabilitation programs for Afghanistan, l would like to highlight the following: We are very much interested in offering resources and intellectual capacity for addressing the issue of post7conflict rehabilitation. The Kyrgyz Republic is ready to cooperate closely with international organizations and various countries to assist in the rebuilding of communication systems, the construction of residential buildings, healthéare and educational institutions, providing medical assistance, delivering and distributing humanitarian goods and forming the infrastructure of the industrial sector We hope to be able to support theeconomy of Afghanistan with a variety of different goods, including humanitarian, agricultural and industrial.We are ready to place orders in our enterprises for the needs of Afghanistan andimplement joint projects with the country.
Having highly professional, skilled and knowledgeable humanresources, our country will consider sending our civil experts to Afghanistan, including healthcarespecialists, engineers, labourers, teachers, agronomists, etc. Another prospective direction for cooperation is training national experts and specialists for Afghanistan in vocational and technical educational institutions, as well as in universities of the Kyrgyz Republic.Today some boys and girls from Afghanistan are trained in our country; howeverwe have the opportunity to receive a much bigger number of them in future.
On the first day of the conference, the Prime Minister of the Kyrgyz Republic,Mr Nikolay Tanaev, described possible areas for cooperation for thepurposes of rehabilitating Afghanistan.
We believe that the above -mentioned areas of cooperation havevast potential, given that during the years of independence, the multi profile production base ofour country and development of the market economy became quite flexible and operational. Dear Ladies and Gentlemen,
I am absolutely confident that this conference will becomean important contribution to the efforts of the world community to promote the rehabilitationprocess of Afghanistan. It is important to find ways for genuine regional cooperation for thepurpose of achieving this goal.
I hope that the outcomes of the conference will become not onlyan additional impulse for promoting attention to Afghanistan, but also for implementation ofconcrete economic projects.
"Only those who move will pass the road, although they do it slowly" isan Afghan saying. I have a firm belief that this conference will makea substantial contribution to the matter of reviving Afghanistan as a responsible, equal and successfulmember of the global community, moving forward with all countries towardpeace and progress. Finally, once again I would like to expressmy sincere gratitude to you all for your active and involved participation in the conference. The Kyrgyz Republic is extremelycertain that only the concerted actions of the world communitycan provide the conditions for building a prosperous Afghanistan. I wish you all every success during the conference.
Thank you. 6ta t oneoy 1 Jr. Mark Malloch Brown Administrator qf the United Nations Development Programme
Mr. President, Honourable Ministers, Distinguished Delegates, Ladies and Gentlemen,
I am delighted to have this opportunity to be here today to participate in this conference on Afghanistan's regional economic cooperation, an initiative that we have beenpleased to facilitate and an event that we at UNDP consider to be a landmark for the future development of this whole region. I particularly would like to thank the Government of ,.Kyrgyzstan for hosting this conference. I am especially pleased to be able to join you in welcoming to Central Asia the delegation from Afghanistan. Since the signing of the Bonn Agreement nearly two- and -a -half years ago, Afghanistan has come a long way in its journey of peace building, recoveryand reconstruction, following years of conflict and misrule. With the improved security situation in Afghanistan, a functioning governmentnow in place and national elections scheduled for later this year many of the fundamentalmeasures needed to secure stability and confidence in the country are being taken, all of whichare vital not only for Afghanistan's peace and stability, but also for the regionas a whole. During more than twenty years of civil conflict, Afghanistan'spolitical and economic relations with many of the countries in the region virtuallyceased. Today, one of the most important objectives of this conference is to restart the dialogueon the critical political, economic and development issues affecting the region, involvinggovernment, the business community and civil society in a dialogue thatcan help develop the strategies required to strengthen cooperation and build the regional links thatare vital for increasing trade, promoting economic growth and reducing poverty and inequality.
Regional economic cooperation is critical to achieving thisand Afghanistan has a pivotal part to play in its success. Afghanistan's pivotal role in the region
Although landlocked, Afghanistan has the potentialto be a land bridge for trade between Central and South Asia, and to traditionally sought -afteraccess to ports in both Iran and Pakistan. Routes through Afghanistan offer the countries ofCentral Asia, for instance, shorter distances to new markets in South Asia thanexisting land links to the Black Sea, Europe or China. Indeed, Afghanistan has already demonstratedits willingness to reach out to its neighbours to encourage closer regional development.
The massive infrastructure investment efforts thecountry is undertaking to rebuild the network of roads across the countryare vital to streamlining Afghanistan's transit links and reducing transport- related trade costs; also criticalis action to tackle impediments to regional trade such as roadblocks and arbitrary demands forpayment at borders. But some of the most outstanding achievements relate to the political context. Already,the 2004 Constitution and the forthcoming presidential andparliamentary elections are forming the backbone for a moreopen, democratic society. For the first time in Afghan history, the base for expanding political and social freedomsis being laid. Afghanistan has also progressed in other areas critical for buildinga fair and just society. The removal of severe discriminatory laws againstwomen represents a significant advance, and where education was a rare privilege in Afghanistan,for the first time in the country's history, universal primary education has becomea right and not a privilege. Afghanistan has also forged a productive partnership withthe international community. This was evident from last month's Berlin conference forAfghanistan, which resulted in pledges of $8.2 billion from the donor community forreconstruction efforts in the country over the next three years.
But it is clear challenges remain that threaten thepeace, stability and development of Afghanistan and the wider region. For too long the illicit drugeconomy has fuelled organised crime, engendered corruption and underminednational and regional development efforts. It is critical that Afghanistancontinue its efforts through the Afghan National Drug Control Strategy- with the support of the international community - to address the illicit trade in drugs that threatens both Afghanistan'sfuture development as well as that of its neighbours. These efforts at curbingproduction and supply can only succeed if complemented by similar efforts in reducing demand. For all the countries represented at this conference, it's clear that your destinies are tied both for good and for ill. The nature of many of the region's development challenges - shared water, narco-trafficking and the spread HIV /AIDS, amongst others - cannot be solved at the national level alone. Harnessing the region's potential in achieving sustainable development Since the days of the Silk Road, Central Asia's role as the ancient junction of a multitude of cultures, religions and empires has marked this region as being of critical geopolitical importance. This is a region endowed with abundant natural resources. It is a treasure trove of natural and mineral wealth, where reserves of oil and gas in Iran and proven reserves in Kazakhstan and Turkmenistan put these countries amongworld leaders in oil and gas production and exports. It is a region that could be bound by energy -related links, such as the proposed gas pipelines from Central to South Asia, as well as through possible power purchase agreements and power grids.Feasibility studies being undertaken reveal that the gas pipeline from Turkmenistan, across Afghanistan, to energy -deficient South Asian markets is expected to carry two billion cubic feet of gas per day, yielding large benefits to all participating countries. It has been estimated that the pipeline would provide a transit income of USD 400 -500 million per year for Afghanistan alone. A pipeline like this could also have substantive savings per year in energy costs for Pakistan and India. Tajikistan and Kyrgyzstan are major exporters of aluminum and gold, and if the hydro - potential of these two countries can be exploited once the harmonized regulatory framework is in place within the region and power trade agreements have been signed, Tajikistan and Kyrgyzstan alone could fully satisfy the hydro -electricity power needs of the region and beyond. Indeed, taken together, the 300 million people of the countries represented at this conference have the potential to be one of the major trading and economic powerhouses of the world. Kyrgyzstan has sought to promote trade as part of its growth and poverty -reduction strategy. It was the first CIS country to be allowed into the WTO. Yet some of its cross - border exports are subject to high tariffs. For small, landlocked countries in the region, exports and trade are the lifelines of their development. The region could learn from Afghanistan's top tariff level of 16 percent. Central Asia is a large and overlooked market largely because neighbours do not treat each other as trading partners. As you have been discussing over the past two days, significant barriers exist to effectively harnessing the region's potential. At present, intra- regional trade flows are relatively small. In 2002, Tajikistan had the highest proportion of regional trade, over 20 percent, followed by Turkmenistan and Afghanistan, at about 10 percent. For the two largest economies, Iran and Pakistan, regional trade amounted to only two percent of combined exports and imports. Pakistan, however, is an important export market for Afghanistan; and trade in energy products has made Tajikistan a significant market for Uzbekistan,and Iran an important customer of Turkmenistan. But if transport links are improved; if formal and informal tariff barriers are removed; if regulations are harmonized and if security can be enhanced, this region can become a more attractive location for foreign direct investment. According to an Asian Development Bank study, once the Almaty- Bishkek -Tashkent- Kabul- Karachi north -south corridor road is completed (4,300 km), the present time of travel, currently 123 hours, is expected to reduce by half. The ADB has estimated that if an effective Central -South Asian transit corridor is established, it would be worth as much as five percent GDP growth a year to Afghanistan alone. Few parts of the world are as interdependent as this region. Regional cooperation is a necessity and not an option. By working together to open borders, harmonize trade and customs regulations and co- operate on energy production and the use of natural resources, the countries of the region can all benefit. But crucially for this region, international experience shows that weak states prevent the consolidation of unified national markets and the rule of law needed to attract long -term investment and lure economic activity out of the informal sector. While there have been many promising developments in the democracy journey for a number of countries in the region, there is still progress to be made in a number of countries to consolidate a culture of democracy that promotes the values vital for both economic growth as well as human development. Here in the Kyrgyz Republic,. for example, we welcome the prospect of competitive presidential elections in 2005, an act of prospective statesmanship for which President Akaev should be commended. Today, I want to finish by emphasizing the fact that economic growth in itself does not equal poverty reduction and sustainable development. Better regulation and tax environments can bring micro- enterprises out of the informal sector and foreign investment into local banks can provide the finance necessary to grow small enterprises into larger ones. But together with investment in roads, power grids, and oil and gas pipelines, all are hollow without the most important investment of all: investment in people. Regional economic cooperation needs to be seen within the context of its end result: human development, which is the ability of every Central Asian citizen to enjoy the opportunity of achieving his or her full potential and, freedom to make choices. Let me close with expressions of sincere good wishes to the people of Afghanistan as they move courageously from war toward peace, and to their government, which is endeavoring to build strong ties with its neighbors; to participating governments in this conference, whose presence here today is a vote of confidence in the future of this region; and of course, to our generous host, the President of the Kyrgyz Republic, whose government has worked long and hard to bring this meeting to fruition.
Thank you. Mohammad Shari rr, srtrrrr, ly'ítr
In the name of Allah, the most beneficent, the most merciful!
Dear Mr. President,
The establishment of the Transitional Government in Afghanistan and the beginning of an era of reconstruction in this country created favorable new conditions in our region. The development of Afghanistan is the foundation for peace and stability in this region and in interrelations among our countries. With active regional cooperation, Afghanistan can progress within a relatively short period of time with the assistance provided by foreign countries. Afghanistan should be able to create a permanent source of income within a reasonable time frame. The creation of the necessary infrastructure has the goal of providing an impetus to the development of investment and trade among countries of the region. It started with the implementation of activities focused on important agreements and contracts, such as stimulation of capital investments, avoidance of double taxation and cooperation in the spheres of customs, transportation, transit and trade. Producers and entrepreneurs of Iran, guided by juridical status and the appropriate legislation, will work actively in the domain of expanding regional trade cooperation. Currently, along with the creation of these trends in economy, special attention is being paid to the creation of the following branches: development of communications, development of the transportation sector, power sourcing and the provision of banking and insurance privileges. After the collapse of the USSR, the Islamic Republic oflran increased its cooperation with the countries of the Central Asian region in the areas of trade, economics and transit. Iran has expressed satisfaction with the progress that has taken place within the past two years of reforms in Afghanistan. It has taken an active role in the implementation of all main activities involving economic development in neighboring countries. The efforts oflran in this period can be subdivided into two main components: --> The easing of trade and transit restrictions between Afghanistan and countries of the region, including the Islamic Republic of Iran;
-)Active participation in the rebirth of Afghanistan. The attempts oflran to initiate cooperation between the two boundary points of Darukan (Eslamgale) and Milek, located in the vicinity of the mutual boundary of Iran and Afghanistan, led to the creation of new trends in economic and regional trade cooperation. This allowed for the securing of quicker and more profitable access points to the international market: At this time, construction projects are being implemented on the Herat- Dukarún, Pol- Milek/Milek -Zarandzh road and on the continuation of the Herat - Meimene road. Trilateral agreements among Iran, Afghanistan and Uzbekistan and Iran, Afghanistan and Tajikistan serve as an example for the development of new relations in the area of road transportation of goods. In this agreement, the transit of goods is considered a permanent source of income in the economy of Afghanistan. It is important to take into account the importance of the private sector as one of the most significant factors in economic relations between Iran and Afghanistan. For the coming three years, a number of assistance mechanisms for former Afghan or joint Iran- Afghan companies have been considered. Disbursement of annual loans in the amount of USD 50 million has been planned for the implementation of these objectives. Iran has attracted the attention of the participants of the conference to the necessity of creating a trust fund for expert capital investments in and is proposing that donor countries establish this fund as an effective meats for the protection of the private sector and joint ventures. It also expresses preparedness to take part in the formation of this fund. At the Berlin conference, Iran emphasized that Iranian companies are available to provide technical and engineering services to Afghanistan. Iran has announced its
Statements preparedness to pay up to ten percent of project costs as a form of assistance to projects to be implemented by Iran. Tehran is also prepared to provide assistance to Kabul with fuel and power. At the present time, three projects are being developed on the transmission of electricity to Afghanistan and preliminary negotiations for providing Afghanistan with fuel are currently being undertaken. Iran also provides assistance to Afghanistan in the domain of water supply. Implementation of projects in this area started two years ago. One of the most important trends of Iran's regional cooperation is a simplified procedure for acquiring citizenship, as Iran provided Afghanistan with more than two hundred thousand visas last year. For the activation of the process of visa issuance, it is necessary to create favorable conditions for organizations operating in this realm. Having implemented these objectives, it is expected that in the current year the process of issuing visas will go on promptly and smoothly. We are strongly convinced that extensive cooperation among the countries of the region in the spheres of economics, trade and transportation of goods will make a positive impact on poverty alleviation and the creation ofjobs. We are sure that activecoordination among countries of the region will raise the spirit of the Afghan peopleand the level of its participation in the reconstruction of Afghanistan. We express hope that all this will positively affect the process of repatriation of migrants to their homeland and will help resolve difficulties related to the drugs trade and general disorder in the country. We consider it necessary to point to the important role that transnational companies play in regional cooperation. In connection with this, we would like to emphasize the fact that members of the Economic Cooperation Organization (ECO), including the countries participating in this conference, have a wide specter of opportunities. The Islamic Republic of Iran highly values the role of the UN at the new stage of political and economic life of Afghanistan and welcomes the initiative of the UN in the matter of providing assistance to the Afghan people. Iran considers it necessary to conduct a continuous sharing of opinions and proposals in the search for effective ways of developing regional cooperation. It sincerely supports the holding of conferences and meetings at the regional and international levels and is prepared to provide active assistance.
We would like to express our gratitude to the Government of the Kyrgyz Republic and the United Nations Development Programme, who initiated this conference, and we wish happiness and peace to all countries and peoples of the region.
Thank you for your attention. To: His Excellency Mr Askar Akaev His Excellency Mr Hamid Karzai President of the Kyrgyz Republic President of the Transitional Islamic State ofAfghanistan
Astana, 6th May 2004
Excellencies,
I would like to thank you for kindly invitinga Kazakhstan delegation to participate in the international conference "Afghanistan's RegionalEconomic Cooperation: Central Asia, Iran and Pakistan ".
I am confident that the restoration ofAfghanistanand its integration into the regional system of economic and trade cooperation is extremely crucialfor the stability, security and prosperity of our region.
Undoubtedly, the holding of sucha conference will create new opportunities for the establishment and development of closer regionalties, as well as lay a solid foundation for turning Afghanistan intoa full fledged economic and trade partner
I would like to assure you that the official delegationof Kazakhstan will takean active part in the work of the conference.
Please accept, Excellencies, theassurances of my highest consideration and wishes of success in the realization of this important initiative.
Nursultan Nazarbaev Sta t by Ms. Zhunur Aitzhanora rice Minis tcr()f.lrrduslry and Trade, Kazakhstan
On the involvement of the Republic of Kazakhstan in the process of the post -war rehabilitation of Afghanistan: During 2003, the volume of circulation of commodities between theRepublic of Kazakhstan and Afghanistan made up USD 49, 485, 000, including export USD 49, 481, 800, import USD 3, 700, 000. In comparison with a similar period of the last year (USD30, 913, 900), the volume of circulation of commodities increased by 60.1%, thereof export (USD30, 907, 000) increased by 60.1%, while import (USD 6,900,000) reduced by 46.4 %. During January -March 2004 the volume of circulation of commoditiesbetween the Republic of Kazakhstan and Afghanistan made up 28, 528,150 USD, including exportUSD 28,460,470, import - USD 67,680,000. In comparison with a similar period of thelast year (USD 13, 900, 700) the volume of commodities circulation increased by105.23 %, thereof
Zhanar Aitzhaova ViCe Mtri+steg , ..,,.. taolostry export (USD 13 907,3 00) increased by 104.64 %, while import (USD 400,000) increased by 16.92 %. Taking into account the increase of commodities circulation during the previous years, there is a stable dynamic of growth in commodities circulation both in absolute and in relative indicators. This tendency is demonstrated clearly in exports of the following articles: Mineral fuel, oil, gas and products of their refinery; Bituminous substances; Mineral waxes (USD 24, 868,370); Ferrous metals (USD 1,222,820); Products made offerrous metals (USD 1,405,490).
Afghanistan represents a developing new market in the region, with an advantageous transit location for Kazakhstan. Kazakh producers have a possibility of supplying various goods, from energy resources to food products, to the market of Afghanistan. This reality is aided by the fact that the world community has undertaken to provide assistance to Afghanistan in the amount of over USD 4.5 billion. In 2002, Kazakhstan donated 2.5 tons of wheat in the form of humanitarian assistance and 85,000 tons of wheat on a commercial basis within the framework of the World Food Program.
The Interagency Committee (hereinafter IAC) was formed by the Resolution of the Government of Kazakhstan as of 24/12/02, No 1353, on the development of proposals for providing assistance to Afghanistan, which is a consultative- advisory body under the Government. The main objective of it is the development of proposals to provide humanitarian assistance in the rehabilitation of Afghanistan and in the opening up of the Afghan market. As of today, five meetings of the Committee were held; the work of the committee is carried out in compliance with the results of the work of the IAC for the respective six months. The following issues were considered based on the work of the IAC:
1. With the purpose of development of the normative -legal base, an agreement on trade and economic cooperation between the Government of Kazakhstan and the Transitional Islamic State of Afghanistan was developed and signed.
2. A list of competitive products that have the potential capacity for entry into the Afghan market was fòrmed and handed over by the Ministry of International Affairs of the Republic ofKazakhstan to diplomatic representations abroad with the purpose of considering the issue of financing by international organizations and donor countries. 3. A request was filed at the Embassy of the Republic of Kazakhstan in Afghanistan on identification of the need of Afghanistan to attract Kazakh specialists to participate in rehabilitation work in Afghanistan. Financial aspects, terms of payment for labor, social protection and insurance all must be taken into account. 4. The Ministry of Foreign Affairs of Kazakhstan continuously carries out work abroad for the purpose of identifying the situation around Afghanistan. The Resident Representative of Kazakhstan under the UN held consultations with special services of the UN Secretariat as well as with a number of specialized institutions regarding the intentions of a number of international humanitarian organizations to make procurements of foods to provide5,000,000 of humanitarian assistance to the Afghan people. Based on the results of the correspondence, the Procurements Department presented requirements to the potential suppliers of agricultural goods and, foodstuffs for the promotion of their product, including within the existing international assistance programs financed by the donor community. This information was forwarded to JSC «Food Contract Corporation» for consideration of the issue on registration of GDP in the database and implementation of operations on supplies of domestic products. 5. Information on the experience offoreign countries, in particular the USA, Germany, Great Britain and Spain, in entering the Afghan market was evaluated. 6. Based on information provided by the Ministry of Education and Science of Kazakhstan, people of Kazakh ethnicity who are citizens of other states, including Afghanistan, were given the right to study based on the state order. A quota was envisaged for the above category of people into higher and secondary vocational educational institutions and was established by the model rules of enrollment into the respective educational institutions. 7. The Ministry of Defense of Kazakhstan provided humanitarian assistance in the fòrm of kits and clothing from the armed forces of Kazakhstan. 8. With the assistance of Kazakhstan, meetings were held with representatives of the UN Office on Coordination of Humanitarian Assistance (UNOCHA) in Geneva for consideration of the issue of utilization of the capacities ofJSC «Aktau Sea Trade Port» as logistic centers within the framework of providing economic assistance to Afghanistan. Upon the application of M. Johanson, Head of the Department on Coordination of Assistance in Europe and Asia, proposals of the Kazakh party on utilization of the transportation infrastructure of the republic and logistical centers will be disseminated among the interested organizations of the UN system providing humanitarian assistance to Afghanistan. They include, among others, the World Food Program (WFP), Food and Agricultural Organization (FAO) and the UN Children's Fund (UNICEF). In case of interest on their behalf; an appropriated request will be drawn up in our proposals. However taking into account that it is not humanitarian assistance, but a proposal of commercial character, it is necessary to apply directly to the organizations that are implementing projects on reconstructing the economy of Afghanistan. In addition, the regional department of WFP advised that identification of a terminal for warehousing and processing of shipments as well as the routes of supply to the place of destination shall be the prerogative of suppliers. They will be selected on a competitive basis. In particular delivery by railway of goods procured in Kazakhstan to the points of distribution was implemented by suppliers. Such points in,Central Asia are located in Termez, Uzbekistan; and Dushanbe, Kolkhozabad and Kurgantube Valley, Tajikistan. WFP also uses Turkmenabad in Turkmenistan and Osh in Kyrgyzstan fbr such purposes; however as we were informed by the WFP in Cairo, it is scheduled to close this year. The World Food Program currently does not have plans for opening new logistical centers in Central Asia for humanitarian goods forwarded to Afghanistan. In conjunction with this, at this stage it is deemed necessary to place the main emphasis with companies dealing with direct procurements of goods for humanitarian purposes in Central Asian republics or in Russia and their delivery to Afghanistan.
9. Proposals on possible lines of assistance to the activities of the International Security Assistance Force (ISAF) were submitted to the Secretariat of the Security committee of Kazakhstan. Based on the information of the Ministry of Transport and Communications of the Republic, Kazakhstan is one of the priority destinations lbr the development of the transit transportation capacity. The Ministry considers the implementation of these transportation routes possible under the existing regulations in the sphere of transportation. A route for the delivery ofgoods by road was proposed as jbllows: Shymkent, Tashkent, Samarkand, Bukhara, Termez, Afghanistan. Airports of the cities ofAlamaty, Shymkent and Astana were proposed as the most appropriate for transportation ofgoods and passenger transportation in the direction of Afghanistan. In compliance with information from the Ministry oflnternal Affairs of Kazakhstan, it deems it possible for MIA Kazakhstan to participate in the provision of safety to the ISAF property in the country. Guarding of property can be organized by appropriate subdivisions of MIA on a contractual basis upon condition of not allowing transportation of illegal cargo. Proposals were forwarded by the Ministry of Industry and Trade to the Secretariat of the Security Committee.
Results of the work of the five meetings of IAC reflect the political intention of Kazakhstan to fully support the comprehensive rehabilitation of Afghanistan and to provide all possible assistance to these efforts.
A visit by President Karzai took place on 15 -16 April 2004 in the course of which an agreement on trade and industrial cooperation was signed. This agreement became the legal fóundation for trade and economic cooperation between Afghanistan and Kazakhstan.
Activities of the Kazakh subjects of entrepreneurship were activated in the market of Afghanistan; trade representation ofJSC «Kazhimmontazh holding» was established in Kabul in March of this year. The main lines in the activities of the company are specialized construction and assembling works, erection of bearing and protective (fencing) constructions and buildings. Over five thousand people are involved. It is necessary to point out that this is in. fact the first sign of interest being expressed by Kazakh companies in developing the Afghan market. In the name of Allah, the most beneficent, the most merciful,
Excellencies, Ladies and Gentlemen, It is my pleasure and privilege to attend this convocation and to lead a 13- member delegation of both senior Pakistani officials as well as members of the private sector I thank, on behalf of myself, the delegation and the government of Pakistan, Excellencies, President of the Kyrgyz Republic Mr. Askar Akaev, Prime Minister Mr Nikolay Tanaev and President of the Islamic Republic óf Afghanistan Mr Hamid Karza, for taking such personal interest in this initiative, which is focusing not only on Afghan reconstruction, but also on the regional developments and interdependencies. The location, in this beautiful and green city ofBishkek, is perhaps a reminder ofjust one of the significant regional opportunities before us all: tourism. We also appreciate the efforts of the United Nations and its allied agencies to have so ably set the stage.fbr undertaking multi- and cross- sectoral consultations, encompassing respective reforms with a regional perspective. The working papers were most informative and indeed stimulating. Excellencies, ladies and gentlemen, Pakistan has achieved a significant turnaround in its economy under the leadership of President General PervezMusharraf and Prime Minister Mir Zafarullah Khan Jamali. GDP growth rates today are close to 6%, inflation down to 3.3% last year, cost of borrowing between 2.5% and an average of 7 %, per capita income approaching US$ 600, budgetary deficits down to around 4% of GDP, total investments grown to 16% of GDP. Exports this year areexpected to be over US$ 12 billion, having increased by almost 50% in four years. FE services now equal almost a year's import, and revenue collection has increased to 17.6% of GDP.These were just a few of f the indicators of success, of course, with miles to go. Having said that, and with reference to the Key Economic Indicators within the region provided for this conference, Pakistan is indeed blessed with the third -largest GDP in the region, reflecting its strength; it is also the fourth -last in terms of its per -capita income and second- lowest in its rate of economic growth, reflecting its own critical needs for economic development and poverty alleviation. Ladies and gentlemen, Pakistan and Afghanistan have steered their combined destinies toward warm, mutually supportive and interdependent shores of economic prosperity. The government and the people of Pakistan are deeply moved by the challenges facedby Afghanistan and firmly believe that a stable and prosperous Afghanistan is vital to regional, sociopolitical and economic stability and development. In alignment with the needs identified by the Government of Afghanistan itself Pakistan has contributed monetarily in this critical hour of need, and continues to do so, whether it was the very sensitive issues related to transit trade or provision of infrastructure, education, human resource development, security and drug control, institutionbuilding, transport and facilities, medical care, use of information technology, or managing the refugee issues. Pakistan is committed to continue contributing in any way it can, within its resources, on a mutually and regionally beneficial basis. Pakistan considers Afghanistan not as a 'landlocked' country, but as a 'land -linking' country. We are also re- aligning our trade infrastructure to help link Central Asia with not only the south and southeast areas, but also with the Middle East and Gulf regions. We appreciate the wide -ranging policy reforms, including the national tariffs introduced by the Afghan government. These will bring greater ease and transparency in trading and investments in Afghanistan and the region. In response, Pakistan is considering the removal of the remaining six items from the negative list of the Afghan Transit Trade. Ladies and gentlemen, in the context of regional development and the need to synergise resources, let me say that the concern for security of capital and returns, for one reason
Statements or another undermines the quick exploitation of the potential that this region offers. We would suggest for your consideration that a taskforce be instituted to consider the challenges of risk management and, with combined resources, develop concepts with the assistance of international financial institutions and other institutions to minimize the risks to potential investors in the various countries of the region. This should encourage our private sectors to undertake business ventures with greater confidence. Recommendations of such a taskforce could then be examined by our respective countries Jbr feasibility of implementation.
Excellencies, ladies and gentlemen, with commitment and optimism, I and my delegation look forward to the outcome of the discussions and recommendations of the working groups and our final deliberations.
I thank you. Statement by Mr. Zia ul Hag Additional Secretary of the Economic At/itirs Division, Pakistan
Dear Mr. Chairman, Honourable Ministers, Honourable Business Leaders, Ladies and Gentlemen,
It is a matter of great honour for me to present my views in this august gathering. It is also a privilege to be part of this conference where business is finding its way into regional planning and making remarkable inroads into regional integration. The conference has provided us with a good opportunity to bring together all the key players involved in this process for a much -needed richer interaction and broader participation. Thinking globally and acting regionally seems to have been the driving force behind the vision of UNDP and allied agencies, who have rightly focused on Afghanistan as a main artery and lifeline for trade and development in the region. Excellency, we are grateful to the Government of Kyrgyzstan for holding this conference in Bishkek, one of the most environmentally friendly cities with the very warm hospitality of its beautiful people. I am sure it could not have been better. The vision and wisdom put forth by H.E. the President of Kyrgyzstan on the economic issues and his insight to drive away the most undesirable elements of an informal economy linked with drug money will remain a source of guidance and enlightenment for all of us. We appreciate the endeavors of H.E. Dr. Ashraf Ghani, the able Finance Minister of Afghanistan, and H.E. Mr. Mustafa Kazmi, Minister of Commerce, for having effectively presented their case for meaningful regional integration. We also commend the initiative, drive and commitment of Afghan leadership. Excellencies; Ladies and Gentlemen, the feedback received in the form of the draft report recommendations is very important and will be of great help in achieving the desired goals.
Statements Pakistan whole -heartedly supports and facilitates trade and investment and also has a vision of a very bright economic future for this region. Ladies and Gentlemen, Pakistan reiterates its support towards the national development and reconstruction of Afghanistan, including provision offinancial, human and technical assistance in all the sectors, by utilizing the private sector We firmly believe that a stable Afghanistan is a key to the social, political and economic stability of the region. We will, as in the past, stand by our brotherly country in any way we are needed. Before I conclude, my special thanks to the United Nations and its allied agencies, including the World Bank and Asian Development Bank, who have set a stage. for multi - sectoral and cross- sectoral consultation and political economic integration. Air Chairman, on behalf of the Government of Pakistan, on behalf of my delegation and on my own behalf please accept our sincere thanks anddeep gratitude for the very warm hospitality we received during our stay in Bishkek. It was indeed a great conference, which has provided us with an excellent opportunity for interaction and deliberation with the regional stakeholders.
We are going back with lots of hope and optimism.
Thank you very much for giving us this opportunity. Dear Mr Chairman,
Heads of Delegations,
Ladies and Gentlemen,
Let me express my sincere gratitude to the organizers of the current conference fin- its organization as well as for the great interest and attention to the issues of rehabilitation of Afghanistan, which is one of the most relevant and timely objectives of world policy and economics regarding the resolution of issues of providing for safety in the region, combat against international terrorism, production and transit of drugs. I am sure that consideration of these issues at the present time will allow, for acceleration of the process of peacefid construction in this long -suffering country, rehabilitation of its economic and social sphere and creation of the necessary prerequisites for implementation of the noble goals that were set forth by the international community. Unfortunately, the results of the war which lasted for many years in Afghanistan, are sad. Practically everything was devastated: industrial production, agriculture, infrastructure, communications and the social sphere. The scale of the economic damage in the country is immeasurable. However it is good to point out that a unique chance has appeared to provide assistance to the Afghan population to go back to a peaceful life, become a full member of the world community and start to engage in constructive labor In connection with it we, the countries of the region, must take advantage of this favorable moment and do everything in order to give back hope for a peaceful future and prosperity to the long - suffering Afghan people.
Resolving the problems of the rebirth of Afghanistan must be considered not in an isolated manner, but in the context of the general development of the region. It is necessary to point out that Afghanistan is located in the common geopolitical space with the countries of Central Asia, Iran and Pakistan, where economic development and safety are interrelated.
The gained experience of conflict resolution shows that any settlement will remain fragile and subject to risks without supporting political decisions with efficient economic measures. It also shows the experience of Tajikistan in settling civil confrontation in the country, when the political will and striving of the Tajik state, headed by the honorable Emomaly Sharipovish Rahmonov, found deep understanding and support from the international community and international organizations. Implementation of programs on post -conflict regulation became a foundation and a prerequisite of reestablishing peace and stability in the region.
It is also comforting to point out that in the case of Afghanistan, we come across the situation where political regulation is keeping step with the efforts of the world community on the eradication of factors that gave birth to armed confrontation, instability and the uncontrolled situation in this country. I would like to emphasize the importance of the Tokyo International Conference on the reconstruction of Afghanistan, which became a turning point in the life of the Afghan people. After many years of war, the world community decided for the first time to deal with the Afghan problem in its essence and seriously. The Republic of Tajikistan is an active participant in the process of regulating the situation in Afghanistan and establishing concord and stability in this neighboring country. From the beginning of the anti - terrorism operation in October 2001, Tajikistan undertook without any hesitation provisions for the continuous delivery of large -scale humanitarian assistance to the population of Afghanistan, simplification of customs procedures and the provision of its air and on -land space for implementation of rescue and humanitarian operations with the forces of international coalition. Tajikistan organized the transportation of humanitarian assistance and of other goods through its territory, supplied by other countries of the world, including Japan. Today the Afghan society is on the threshold of core changes and the international community must provide it assistance in the implementation of this opportunity. The recent Higher Meeting of the Loya Jirga of Afkhanistan once again demonstrated the desire of the Afghan people to go along the way of peaceful coexistence, adherence to the democratic ideas of development and showed the confidence of the Afghan people in His Excellency Mr Hamid Karzai, the present head of the Government. Efforts of the international community must be focused so that, in the fùture, Afghanistan will stop being a source of threats to safety, including illegal drugs and arms trafficking, illegal migration and dissemination of ideas of fundamentalism and religious extremism not only to the Afghan people themselves, but also to other countries of the region. Tajikistan expresses its assurance that it is possible to resolve the Afghan problem with the help of joint efforts of interested parties and states. Tajikistan and Afghanistan are united by many factors: common boundaries, common historical past, lack of language barrier, closeness of cultural values and traditions and the same religion. Due to this, our countries gained centuries of experience in cooperation. Unfortunately, at the current stage of its development, Tajikistan cannot act as a donor for the reconstruction of Afkhanistan. However, Tajikistan possesses the possibility for providing real assistance to the revival of its neighboring country. In particular, Tajikistan possesses a possibility to export electric power to the neighboring regions of Afghanistan in the summertime in the volume of 1.5 billion kilowatt -hours per year There is a possibility of constructing one more giant hydro- electric station on the border river Piandj, for which cost estimates, documentation and feasibility studies are available. Furthermore, Tajikistan is prepared to mobilize its own industrial capacity for the revitalization of Afghanistan through the increase of production of industrial- technical goods, household goods, power transformers and appliances, which are in high demand in Afghanistan. Besides this, Afghanistan can apply its experience to the construction of irrigation facilities, water -resource utilization and the cultivation of fallow lands in Afghanistan when determining specific objects for cooperation. It is necessary to point out that Tajikistan possesses significant capacity in the construction industry, which is not being used to its full extent at the present time due to a lack of internal order. In connection with this, we can supply to Afghanistan high -quality cement, construction materials, including armature (steel /ferro- concrete reinforcement), residential buildings made of pre -cast large concrete panels, production premises and other construction facilities in sufficient quantities.
Taking the length of the boundary into account, it is possible to consider Tajikistan as one of the main transit routes to Afghanistan. There is a necessity to construct bridges across the trans- border river Piandj and develop a network of roads and infrastructure. Tajikistan already has built three bridges, and it plans to build two more. Tajik contractors can participate not only in the construction of these bridges, but also in construction of other facilities and objects. This will also allow for the accelerated reconstruction of objects and the development of large -scale trade near the border, which will allow the satisfaction of the needs of the Afghan population in staples produced both in Tajikistan as well as in other countries.
Taking all the above into account, I propose the implementation of all deliveries of goods and humanitarian assistance to Afghanistan via roads in Tajikistan, widely using the transportation corridor of Alma ty- Tashkent -Dushanbe -Kabul -Karachi and the built bridges.
Tajikistan has the ability to train specialists of medium levels and higher in many professions in Afghanistan. Such cooperation has a long history, and it actually was not interrupted until recent times. Many Afghan students receive training in the higher educational establishments of medical, technical and agricultural profiles. In the past, Tajik specialists taught in higher educational establishments of Afghanistan, and this experience could be used now All that I have mentioned is only a small part of the possible directions for expanding and deepening cooperation with Afghanistan. Our countries have a lot in common, which allows for close cooperation in other spheres of economics, culture, education and medicine.
In conclusion, I would like to emphasize that the social and political situation in the region, to a great extent, depends on the further development of the situation in Afghanistan. In connection with this, countries of the region, and in particular Tajikistan, are very much interested in the rapid reconstruction of Afghanistan and are prepared to expend all possible efforts for this purpose. Once again, I would like to express gratitude for the attention of the world community to this country. It is possible only by mutual efforts to achieve the stabilization of the social and political situation in this long- suffering country, rehabilitate the ruined economy and bring the population back to normal life and constructive- labor I am sure that it can become a prerequisite for the achievement of success and a guarantee for maintaining regional safety in general. Thank you for your attention. Your Excellency, Mr Prime Minister, Mr Chairperson, Dear Heads of Delegations,
Ladies and Gentlemen,
Let me on behalf of the Republic of Uzbekistan greet the convocation of such a representative conference. Also, taking advantage of the situation, let me express words of gratitude to the hosting party. for its welcome and hospitality as well as to the organizers of the forum for its great preparation. The current meeting testifies that issues of the peaceful development of Afghanistan are the focus of the attention of the world community. Once again, a stable, prosperous Afghanistan is in the interest of the world community, particularly Afghanistan's neighboring countries. 1 think that it is not necessary to emphasize that the achievement of these goals plays a paramount role not only in the matter of the stability and economic development of Central Asia, but also to a significant extent in the whole process of providing for global safety. Horrible terrorist acts in Iraq, Turkey, Spain and Russia, as a result of which hundreds of innocent people have died, testify to the relevancy of this thesis. Recent tragic events in the Tashkent and Bukhara regions of Uzbekistan, which also caused the deaths of innocent people, are one more convincing piece of evidence of the fact that international terrorism and extremism are not going to lay down arms easily. In connection with this, Uzbekistan highly appreciates the efforts of the international community, which target the successful finalization of the antiterrorist operation and rehabilitation of the political and socio- economic infrastructure ofAfghanistan. The adoption of the new Constitution of Afghanistan in January 2004 was an important success in this direction, which in our opinion means the creation of the necessary prerequisites for normalizing the situation in this country. Significant in this process is the organization of the first democratic elections in Afghanistan in autumn of this year. This success will have a real impact on the construction of a peaceful, democratic and prosperous Afghanistan. The international conference held in March 2004 in Berlin once again proved the necessity of further development with the purpose of stabilizing the situation in the country and terminating the threats that come from its territory.
Dear Ladies and Gentlemen, AAshevSata`MvdmoN z©v o1\heFteAA-"-vu6k.ti \fin \o \he Kv'::.R
Uzbekistan fully and completely shares the fundamental resolutionsof the United Nations on Afghanistan and the decisions of the Bonn, Tokyo and Berlin conferences; calls for the rapid implementation of a set of actionson the political and economic rehabilitation of Afghanistan; and reaffirms its interest in participating in internationalprojects on the rehabilitation of the Afghan economy.
The Trilateral Agreement among Uzbekistan, Afghanistan and Iranon the creation of the Trans - Afghan Transportation Corridor, initiated by thegovernment of the republic, may serve as an example of the above.
At the beginning of April of the current year,a trilateral meeting of the Deputy Ministers of Transportation of Uzbekistan, Iran and Afghanistan took placewith the purpose of practical implementation of the current project.
Outlines of the Uzbek- Afghan cooperation in the spheres of educationand printing arts were indicated in the course of the visit of Mr Yunus Qanuni, Minister of Education of Afghanistan to Tashkent within the framework ofan international conference that took place on 5 -6 April of the current year.
Statements Besides this, the Uzbek party actively participates in the rehabilitation and construction of bridges along the Termez -Mazar- i- Sharif -Kabul route. The Uzbek specialists already have built ten bridges, providing for a non -stop realization of transportation freight flow. With the. financial support of the American company "Central Asian Partners" and in cooperation with the Afghan party, the Uzbek specialists started pre project research works on construction of a part of railway between Hairaton and Mazar- i- Sharif Uzbekistan expressed its preparedness to take part in bidding on construction of the electric power transmission line between Hairaton and Puli -Humri. Specialists of Uzbekistan also show their interest in participating in the rehabilitation and construction ofpower and hydroeconomics in the northern and central regions of Afghanistan. The Government of Uzbekistan, in cooperation with the United Nations and donor countries, created a mechanism fbr coordinating the freight flow for the purpose of .facilitating freight delivery and transit to Afghanistan. In spite of difficulties during a transition period, Uzbekistan continues to supply electric power at reduced tariffs and provide for the non -stop passage offreight flow by transit across the republic, facilitating over 2.5 tons offreight, aside from the country's own humanitarian assistance delivered to Afghanistan. The Government of Uzbekistan also adopted measures on the improvement of service infrastructure and reduction offreight transit costs supplied to Afghanistan. I would like to point out that a broad involvement of economic resources and the full capacity of the republic for the rehabilitation of Afghanistan will create a possibility to use international resources effectively, through reduction of transportation costs and low prices for Uzbek products. Dear participants of the meeting, The on -going positive processes in Afghanistan thanks to the attention and assistance of the international community open big perspectives for implementation of large -scale economic, trade, transport, communication and other projects in Central Asia. Both countries of the region and international organizations and foreign countries are equally interested in their results. Simultaneously, the resources of the international community must be focused on the implementation of effective measures to control drugs in Afghanistan
4 Assistance to the processes of structural changes in the Afghan economy;
-, Development of alternative types of agricultural production;
Creation of the "anti -drug belt" around Afghanistan;
Providing for employment of the population in peaceful and constructive labor In connection with this, the Uzbek delegation entrusts big hopes in the activities of the regional anti terrorist structure, the Shanghai Organization for Cooperation, as well as in the practical implementation of the initiative of Islam Karimov, the President of the Republic of Uzbekistan, on the creation of a regional information -coordination centre to combat transboudary crime and illegal drug trafficking,political support of whichwas delegated by the states of the region. Ladies and Gentlemen,
The Uzbek party fully shares the concluded earlierinternational agreements and the measures that are being undertaken with respect to the peaceful developmentof Afghanistan. We express hope that the Government,headed by Hamid Karzai, with the help of the international community will succeedin implementing the historic mission of the rehabilitation of the country.
Undoubtedly, the achievement of these noble goalsmeet the long -term interests of the Afghan people and will allow for strengthening ofsafety and stability in Central Asia and the development of mutually beneficial ties betweenAfghanistan and its neighboring countries.
Thank you for your attention. Statement by Mr. Alastair McKechnie Afghanistan Country Director of The World Bank Group
Our meeting during the past two days has reinforced the strong interests of the private sector and governments in the greater Central Asian region to seize the opportunities that are now available and to deepen regional economic cooperation. A central message for Central Asia from this meeting is that there are countries to the south that are open for business. For the countries in the south, there is now an awareness of the changes that have taken place in Central Asia and the economic possibilities that now exist.
region are exploring the possibilities for greater trade and investment. If the policies
SI. are right and institutions ASINSI efficient, over the next few years the private sector could surprise us with trade and investment within the region that we cannot dream of today. Yet it is likely that trade outside the immediate region will continue to dominate regional trade flows. But it is also possible that this region will return to its historical role of the land bridge to the dynamic economies of China, India, Russia, Europe and the Middle East. Increasing trade, which consists of imports as well as exports, is important to meeting the hopes of the people in the region for better lives.International experience shows clearly that countries that integrate with the international economy grow faster and reduce poverty more quickly than those countries relatively closed to foreign trade and investment.Trade and investment are also important for Afghanistan to achieve the ambitious targets that double per capita incomes in the next seven years, which are set out in the Government's report "Securing Afghanistan's Future ".A stronger economy is one of a few critical factors influencing the stability of Afghanistan. As several speakers have 'reminded us this,week, the stability of the region depends on the stability of Afghanistan, and vice versa. As we look forward, future trade flows and investment will depend on the actions of the private sector.Investment wilfflow to those countries where the business environment is favorable: transparent and efficiently implemented laws and regulations, infrastructure that works, where finance is available, and where the labor force is well educated and flexible.Similarly, trade will flow along those corridors where the costs of transport and logistics are lowest, and where bureaucratic obstacles are low It is costs that determine which transport route is chosen, not distance. We urge the countries of the region to implement the recommendations to facilitate trade and investment that are set out in the reports of the working groups. Some of these recommendations are not difficult to implement, such as sharing of information on trade and investment regulations, or facilitating issuing of one-year multiple -entry visas to business people and transport operators.We recognize that some countries wish to move at a faster pace than others. The working groups propose that coalitions of like -minded countries should work together along transport corridors to simplify and harmonize transit procedures. Also, some countries are likely to liberalize rules for trade and investment on a bilateral basis, but this should not be at the expense of trade with the rest of the world, or make future multilateral agreements difficult. The World Bank has been working with Central Asian countries and partners such as ADB and UNDP to facilitate trade within the region. ADB has focused on infrastructure and the World Bank on trade policy and logistics. The World Bank report is under discussion and should be available within a few months. Similar work on trade logistics has been done in the other countries participating at this meeting and this analytical work can inform the discussions of policymakers at both the national and regional levels. MIGA, the political risk insurance arm of the World Bank Group, in association with ADB and bilateral donors, will have a risk -mitigation facility in place for Afghanistan after July. Energy Trade Energy is already one of the main items traded within the region and there is potential for growth. Afghanistan already imports most of its petroleum and electricity and importsare likely to supply most of the increased demand in the near future. There is a range of options for future electricity trade in all countries of the region, which include benefiting from comparative advantages such as primary energy endowments and existing infrastructure; enhancing reliability of service; lowering costs through daily and seasonal transfers, achieving economies of scale in power generation; adjusting to temporary mismatches between supply and demand; and large -bulk power transfers within and outside the region from specially constructed plants. We propose that regional power trade develop along two tracks: first, to continue bilateral trading arrangements using existing surpluses; and second, to deepen efforts to develop the broader regional potential. Some useful work is already underway, including an ADB study of regional power infrastructure and studies by the World Bank of power and water issues in the Central Asia region.There is a need to extend this work to South Asia and Iran, deepen knowledge of economics of energy trade, identify constraints and risks and to assess contractual requirements. Together with our international partners such as ADB and ECO, the World Bank is ready to convene a technical meeting later this year to share information and to map out options and a work plan for increasing energy trade in both the short and long terms. We wish to operate within existing political frameworks such as ECO and the Dubai Good Neighbourliness Declaration and generate options for senior policymakers to consider. This would need to be followed up by pre- investment studies that would include risk management, transit arrangements and principles of contractual arrangements, recognizing that it is the right of sovereign states and empowered national institutions to negotiate specific agreements.We will be contacting you with a written proposal for the meeting. Conclusion We have made some progress over the past two days in preparing the ground fordeeper regional economic cooperation.The path ahead is reasonably clear. What is needed now is action, wherever action is possible. It is easy to agree that more trade andinvestment is needed, but much harder to make the changes to allow this to happen. Let this not be another meeting where we leave feeling that there is momentum, but where there is no follow -up. I strongly endorse the proposal that the private sector monitor transport times and costs and embarrasses us in public if we fail to deliver This region has an historic opportunity for a quantum leap in economic cooperation that has not existed for 200 years.The people of the region rightly expect a higher quality of life.It is our duty to help them achieve it. Statement by Dr. Frank Poluran Senior Advisor of the South Asia Department and Special Representative to A /=hanistan of the Asian Development Bank,
Dear Mr. Chairman,
Your Excellencies,
Ladies And Gentlemen,
Let me take this opportunity to first express on behalf of ADB and my personal behalf our gratitude to the Kyrgyz Government for the hospitality and excellent arrangements for this landmark conference. I also wish to thank our colleaguesin the UNDP for taking this initiative and for the quality of background documentation and all other preparatory efforts. This conference further demonstrates the synergies achieved and benefits from close collaboration among development partners that has been characteristic of reconstruction efforts in Afghanistan. This has been possible because of the tireless guidance of Finance Minister Ashraf Ghani, and I speak on behalf of all development partners that we look forward to receiving this guidance and working with you in future.
This conference is proof that the changed situation in Afghanistan and opening of its trade and transport links represent a historic opportunity for the region. The Silk Road can be rejuvenated and the economies of Central and South Asia can rehabilitate the historical links that have significant welfare- raising potential for people in both regions. Recognizing this historic opportunity, ADB has quickly reconfigured its sub -regional cooperation activity and now established a new program of regional economic program among Central and South Asian countries. The Central and South Asia Transport and Trade Forum has emerged as the framework for designing and implementing the ambitious road corridor projects connecting CARs to warm -water ports through Afghanistan and for modernizing the cross- border trade infrastructure and harmonizing customs regimes. I am happy to report to this conference that this initiative is gaining momentum. The first ministerial meeting held in Manila in early 2003 was followed by a working group meeting held.in Dubai in March this year and we expect substantial progress in the forthcomiWW second ministerial meeting tentatively scheduled for September of this year Among others, ADB is financing the reconstruction and improvement of sections of these road corridors and border -crossing infrastructure. This
Statements is in the amount of about $500 million, and is expected to be disbursed by the end of 2006. ADB 's approach to regional economic cooperation has emerged from a long experience of leading regional cooperation efforts in the Mekong region and in the Central Asian Republics. ADB's Greater Mekong Subregional Economic Cooperation Program and the Central Asian Regional Economic Cooperation have both been accepted as the principal framework for regional cooperation efforts in the two regions. ADB's approach to fostering regional economic cooperation has been to focus on actual projects that have the potential to generate tangible gains in a finite period and build regional cooperation mechanisms around them. This is an approach that has yielded positive results in terms of building political will, enhancing mutual trust, creating confidence in cooperation by producing win -win solutions and mobilizing the necessary financing on the basis of sound project proposals. This approach is also being pursued in establishing the Central and South Asia Trade and Transport Forum. The project -based approach adopted by ADB for promoting regional economic cooperation is reflected in our support for flagship projects like the TAP natural gas pipeline and the North -South and East -West road corridors. Potential benefits accruing to Afghanistan from these projects have already been mentioned. Let me simply add the positive externalities from these projects in terms of attracting private investment in associated activities and in raising the visibility of this region and sending strong signals to the world that the region is open for business. The significant presence of the private sector in this conference will already send these positive signals. This is a real value -addition feature of this conference. I only repeat the sentiment expressed earlier by Finance Minister Ghani that the region's .future progress and prosperity is contingent upon its ability to attract private investment. We in ADB will look towards the private sector to monitor the progress in public infrastructure and delivery of public services and provide the necessary feedback. This will help us to ensure satisfactory advance in such projects and be a good example of constructive private public partnership, which as we know from the Asian experience is a necessary condition for rapid growth and poverty reduction. ADB is actively promoting the development of the private sector both in the Central Asian Republics as well as Afghanistan. Ladies and gentlemen, promotion of regional economic cooperation is one of the principal mandates of ADB. We see this as one of the principal instruments for achieving sustained inclusive growth and poverty reduction in Asia. On behalf of ADB, I would like to assure this conference and all delegations ofADB's commitment to facilitating Afghanistan's integration into this region and for promoting stronger transport and trade links, which will directly benefit Afghanistan, Iran, Pakistan and the Central Asian Republics.
Thank you. Closing remarks by Mr. ErcanMurat Country Director of UNDP Af/;i,ijsia,,
Mr Chairman and Distinguished Guests: letme begin by thanking you all for making this conference a success, and for theenergy that you have brought to these proceedings.
tar) When the idea for this conference was first raised, in Afghanistan and Kyrgyzstan, the organizers, and UNDP as the primary facilitator, hoped that it would prove a useful way to introduce Afghanistan to Central Asia. It has proved to be much more. In the pastfew days, we have seen government delegates from these eight countries interact formally and informally, learn from one another and set a foundation for their future relationships. We have also seen private- sector actors many meeting each other for the first time begin the process of doing business across this region. This is whatthe conference organizers hoped to achieve, and I want to thank you all for helping to make this possible. In the past three days, we have shared our experiences and hopes for the region. We have learned that not only Afghans but also many regional actors see the reconstruction of Afghanistan as a catalyst for economic dynamism across south, central and west Asia. This concord about the present and the future is welcome and, I believe, extremely important for the security and prosperity of all the countries represented here. Even more, the interaction between the private sectors during this conference has confirmed the hope of the conference organizers that good policy can support trade and investment. Equally important, we can see clearly that business will help to lead Afghanistan's recovery and, in so doing, spur on economic growth among all of Afghanistan's neighbors. We anticipated these conclusions, of course, but it is heartening to see them come full circle at this conference. As we end this conference, hard work lies ahead. Our ministerial delegates have made clear their intention to join in efforts to build bridges among their countries and establish firm, practical policies that will lead to mutually beneficial growth and development. Our working groups have helped to formulate elements of a policy agenda that can take this commitment forward. And everyone at this conference has demonstrated that the political will needed to support regional economic cooperation so often lamented for being hard to identib2 and harder to put in practice exists across this whole region, and takes many creative and interesting forms. Since we have all heard reports from the working groups, and the responses of government ministers to the issues raised in them, I will not repeat theirconclusions here. Let me instead highlight the issues that will be most important as we all begin to implement the proposals offered during this conference. First, who will benefit from enhanced cooperation? It is clear that the national economies of each state, and Afghanistan's in particular, are the beneficiaries of cooperative economic relations. I was heartened to hear all the working groups raise as a primary issue the needs of the poor and the most vulnerable in all societies. Some of the countries represented here are resource poor; others have the potential for great riches. All include vulnerable populations that require special attention in the policy arena whether the poor, the displaced, or the disenfranchised and I am glad to see that this issue remains paramount across the region. Nonetheless, in á region beset by poverty, there is a wealth of human resources. Second, therefore, is the question: how will the region benefit from cross -border collaboration? In this regard, among the most important issues that received detailed attention in our discussions were the manifold ways that human resources can be enhanced across the region. Among development organizations, we call this capacity building; others talk about training and education and building civilsociety. All these formulationsare accurate; all are important, for Afghanistan and the region in whichit lives; and all can contribute to both public- and private-sector development. I am very pleased to hear of specific offers of assistance for training, andeven more, to learn of innovative proposals to share these resources across borders. The proposal fromthe Government ofAfghanistan to encourage the region to undertake a review of regionaltechnical expertise might usefully be matched with asurvey of institutions available and willing to be matched for capacity building. In addition, it has been suggested thatbilateral economic commissions be expanded to address issues of training andeducation, and that a regional commission on capacity building be created. UNDP is, of course, willingto support these assessments and institutions, and I trust thatour partners in the community of multilateral organizations and bilateral donors will be enthusiastic aboutthis as well. This raises a third question: howcan the region take advantage of its resources? We heard quite a lot about sharing information, and again,working group discussions offeredsome original proposals in this arena. We at UNDPare persuaded that sharing information, while a good in itself is made better by findingways to rationalize the collection and dissemination of public and private information. Iwas therefore intrigued by proposals to harmonize data collection and analysisacross the region as a direct contribution to policy -making, and to use these instruments collectivelyto tackle problems ranging from procurement to the alleviation of poverty. I am certain that theinternational community will welcome these ideas, and support them vigorously.The increasingly open communication environment across the region will undoubtedlymake it possible to further these efforts, and I commend all the workinggroups for highlighting the close relationship between free expression and economic development.
One element of this initiative isa proposal for regional monitoring of social and economic progress including progress toward fulfilling the Millennium DevelopmentGoals and also of the impact and outcomes of investment and trade.It is significant that our working groups sought to institutionalize this process through the privatesector. This would be a milestone in public private partnership in this region.If this initiative looks carefully at the fundamentals of trade including customs proceduresand protections for labor migration then the interests of governments, citizens, businessesand consumers will be satisfied in important ways. I haveno doubt that the ECO Chamber of Commerce,now situated in Kabul, will be happy to support thisinitiative, and UNDP stands ready to assist as well.
And fourth, how can the region maximize itsresources in the short and medium terms? One key way to expand economicresources is to expand trade, and I found our working group discussions on transit trade refreshingly honest and optimistic. Bordersbetween states now offer opportunities for cooperation and trade,where once they offered only obstacles to communication and travel. I won't detailall the proposals that emanated from the working groups, but will simply highlight themost important fact of these discussions: trade across borders will undoubtedly benefitevery state in the region. It will open new venues for interaction, turn each state including Afghanistan, wherewar disrupted ancient trade routes and the energies of avidentrepreneurs and act as an incentive for investment. In particular, trade in power and investment incommunications will be critical to the economic stability and security of the region, and Iam pleased that our working groups devoted so much attention to these twosectors. We in the United Nations community have learned that traders scale mountains and ford rivers and in this region, drive seemingly endless distances and thus help to create communities where once war disrupted communication. Economic cooperation, private and public, helps to stabilize societies and secure peace; lasting peace and stability, in turn, are incentives toward economic growth. The Government of Afghanistan has articulated these sentiments during the past two years, as matters of policy and conviction. We trust that all the participants in this conference have come to similar conclusions. This is the message that we hope you will carry home from this conference, and the foundation on which new and renewed economic collaboration can he built. UNDP, its partners in the World Bank and the Asian Development Bank, and the Government of Afghanistan stand ready to help implement the proposals that have been generated by this conference, and if requested, to facilitate future conferences, however regularly or frequently may be appropriate. Let me close with a personal note. I have spent the past decade working in Central Asia and now, Afghanistan, and remain fascinated by the diversity and creativity that the region encompasses. Each of the states in this region and of course, the larger economies of Iran and Pakistan as well have, faced their social, economic and political challenges in different ways. However different they may seem, it is clear that this is a region ripe for more change and future prosperity. It has been UNDP's pleasure to facilitate this conference. Let me thank once again the Government of the Kyrgyz Republic and the Transitional Islamic State of Afghanistan, whose cooperation made this conference possible, and the governments and private sectors of all participating countries for making this conference a success. We look forward to continuing our work with you all, and to fostering your future relations with one another. Experts' Working Group Meetings
Opening speech by Mr. Jerzy Skuratowicz LW Resident Coordinator and LWDI'Rest(t Repre.S"entatll`e. in Brshkek, hl?lgl`- Republic
Excellencies, Ladies and gentlemen, Colleagues,
I am proud to open this regional forum - and thank you for coming. Thank you for the positive response, which is very much encouraging for all of us. This is a reflection of the natural and growing interest in regional cooperation. This is also a reflection of our responsibility for the future prosperity and stability of the region. This conference is the materialization of ideas born in two countries - Afghanistan and Kyrgyz Republic - and in two UNDP offices belonging to two regional bureaus. The event has been organised in close collaboration with the Governments of the Kyrgyz Republic and Afghanistan, as well as the World Bank and Asian Development Bank. We will be looking into the three aspects of regional development:
1)Afghanistan as an emerging new player in the region; 2)Trade development and facilitation, as they are the best available mechanisms for the beginning of integration; 3)Issues cpnnected with the "hardware " for trade: infrastructure, transit, etc.
This conference should be,pñ important event in the process of searching fornew opportunities and partners and in understanding that the potential benefits areenormous. At stake is a new advantageous situation for all the countries represented here in this room. UNDP's objective is to facilitate this dialogue.
Statements Afghanistan is currently receiving a lot of attention. We are all proud of the progress made and we look forward to the potential prosperity to be attained by Afghanistan through future regional cooperation. We are hosting seven countries here: traditional partners of Afghanistan and its new, potentially very important partners in Central Asia. Our intention, however, is not to replace ties that have proven efficient and have their own traditions, but rather to explore new opportunities for multilateral cooperation. It is not only Afghanistan that will benefit from this discussion forum. It is an important event for each and every country. The issue is how to harness the dynamics of particular economies for the benefit of the whole region. A regional approach has recently been more and more important for the UN system. We would also like to expose the role of the private sector Governments create a framework and conditions, while private entrepreneurs will be creating livelihoods in the region over a longer period of time. It is important to understand that this is the beginning of a process. We may wish to have a joint statement at the end of this conference; we may also wish tohave an even more important. follow -up to continue and deepen the process of dialogue. Finally, I would like to explain the rules of the Working Groups. Their objective is to generate inputs to the Ministerial meeting on the third day. The themes of the Working Groups are as follows: Working Group 1 - Political, strategy, and framework. Working Group 2 - Trade-related: chaired by distinguished representatives of the Ministries of Economy and Trade. Trade is the best -known mechanism for integration. Working Group 3 - Infrastructure and transport: the "hardware " for the development of trade, attracting investment, etc., chaired by distinguished representatives of ministries related to its development. A special event for the private sector is also foreseen on the second day to discuss, interact and establish long- lasting ties.
Thank you. ?e' E°e kolay T TanilTv of theIs.;
Distinguished heads of the delegations, Distinguished guests, Ladies and Gentlemen,
It is a great honor and a pleasure for me to cordially welcome the participants of the "Afghanistan Regional Economic Cooperation: Central Asia, Iran and Pakistan" international conference in the hospitable land of ancient Kyrgyzstan. I am also very happy to express my sincere gratitude to UNDP for organizing this conference, as its agenda is extremely topical. At the plenary sessions and in the working groups we will have a chance to openly discuss aspects of internal political issues, as well as the social and economic situation in Afghanistan, institutional and economic changes in the country, the, formation of a sustainable national economy and ways of integrating the country with the economic programs implemented at the regional level. We will also have the opportunity to adopt a consolidated final document of the conference. I hope that your stay in Bishkek will be pleasant and productive. From our side, we will do everything to provide you with favorable conditions for fruitful discussions, negotiations and rest during the coming days. Dear participants of the conference, The recent events in Afghanistan, Iraq and the Middle East, as well as other troubled places on the planet, vividly demonstrate that it will not be possible to deal with local and global threats to new generations by force alone. An adequate response to the challenges we have to deal with today should inevitably have political, social, economic and humanitarian dimensions. According to the ideas of the Bishkek meeting organizers, this is its main mission, as a sort of tribune for exchanging opinions and agreeing on mechanisms for multi profile interaction between neighboring countries and international organizations. This is to be done for the purpose of assuring peaceful co- existence and progress for our countries and beyond. Today Afghanistan has been experiencing the historical transition from war to peace and revival. It has a unique chance to strengthen its independence, to achieve political and economic stability and inter -ethnic consent. It means that the country has a real opportunity to create a future in which there will be no room for abuse, bloodshed or the disintegration of nationalities. Conflicts based on ethnic differences, hunger, extreme poverty and isolation also have the potential to be made things of the past. Today the international cgmmunity has a chance to provide its own resources for the stage -by -stage rehabilitation of long -suffering Afghanistan. In this respect, it is very notable that our forum is actively supported by UNDP within the framework of prominent initiatives of the UN Security Council for the purposes of developing decisions made from the previous three conferences on Afghanistan, which were held in Bonn in 2001, Tokyo in 2002 and Berlin in 2004. It should be noted that a lot of progress has been achieved since the time when the Taliban regime was overthrown in 2001. Anew constitution for the country was passed, the next presidential and parliamentary elections will take place this year and they must accomplish the process of political transformation in compliance with the Bonn Agreement. However, the current situation in Afghanistan is still not quite secure, in spite of certain elements of its stabilization and a general return to peaceful life. Under these circumstances, we believe, it is extremely important to provide external assistance to the 'transitional administration, headed by H.E. Hamid Karzai, and, later,to the newly elected Government of Afghanistan. It will be also be very important to assure effective involvement of Afghanistan in concrete projects aimed at economic integration between states. Dear Ladies and Gentlemen, Today we have achieved a wide international consensus on the fact thata peaceful and stable Afghanistan is an extremely important factor for the future stability and security of our region. The proper regulation of complex internal problems and achieving a peaceful situation in Afghanistan will determine the prosperity of Central Asian countries and other neighboring states. Furthermore, it is apparent that the resolution ofmany issues related to security and economic cooperation at the regional level will not be possible without the direct participation of the official Government of Afghanistan.
However, it is clear that the intentions of the world community in relation to the post-war rehabilitation of Afghanistan are facing serious difficulties with regard to their practical implementation. Unfortunately, we have to state that some of the more than 50 donor countries have not fully executed their commitments, and therefore a number of high- priority programs and projects have still not been implemented. According to the data of independent experts, in 2002 -2003, Afghanistan received much less external assistance only $67 per capita than other states that appeared in a similar critical situation. In spite of the fact that the price for a more stable Afghanistan might seem high, it is incommensurable with the astronomical price that will have to be paid incase of failure to achieve the goal of reconstructing the country. One should also bear in mind the fact that UN decisions on rehabilitation of the country may become secondary basedon the issue of Iraq. We truly believe that the main grounds for the positive development of events in Afghanistan and around it must be the understanding of the principal idea thatwe all are partners in this process. Our states have common historical and cultural roots that go back centuries, to the era of flourishing trade along the Silk Road. History itself .encourages us to continue these traditions. I think that the idea of tying the interests of Afghanistan with the national interests of the countries involved in this conference will be objectively considered as a priority by their delegations when they determine theprocess for the rehabilitation of post-conflict Afghanistan. We will also have to adopt a relevant action plan. As representatives of the Kyrgyz Republic believe, it should primarily envisage a level of participation byour countries within the framework of the processes mentioned above. It should also formulate the role and place of Afghanistan in regional integration. Finally. it should attract the attention of the world community to the mobilization ofjoint efforts for thepurpose of setting up a stable future for the people of Afghanistan. Distinguished participants of the conference, At the end of my presentation I would like to highlight that the Kyrgyz Republic considers itself to be a friendly state and a responsible partner ofAfghanistan. Thus, ina comprehensive fashion and on a long -term basis, it is ready to participate in thecurrent programs aimed at its economic and social revival. It will also be involved in the projects that will be implemented within the framework of direct bilateral cooperation.
We understand the concerns mentioned by President Karzai in his statementson the eve of the recent Berlin conference, "The crisis of my country is the crisis of the whole region." Therefore we are keen to provide any possible assistance to Afghanistanso that people can live peaceful lives as soon as possible. The Kyrgyz Republic supports a multi faceted approach to cooperation with Afghanistan; it has been closely involved with international organizations and certain countries inthe following areas: Rehabilitation of destroyed communications systems, construction of new residential buildings and institutions of healthcare and education; Providing medical assistance, delivery and distribution of humanitarian goods;
Forming an infrastructure of productive capacities in the Kyrgyz Republic, which, in the mid -term, will be able to support the economy of Afghanistan with a variety of different goods, including for humanitarian, agricultural and industrial purposes;
Placing orders in our enterprises for the needs of Afghanistan;
Sending our civil experts -healthcare specialists, engineers, constructors, workers, teachers, agronomists, etc. to Afghanistan; Training national experts and specialists for Afghanistan in vocational and technical educational institutions, as well as in the universities of the Kyrgyz Republic;
Promoting the resettlement of 750 refugees from Afghanistan in their motherland or other places where they permanently reside. The Kyrgyz Republic is also ready to consider sending to Kabul a group of military consultants in the areas of maintaining, repairing and operating armored machinery and telecommunication facilities that were left in the Afghan army during the time of the former Soviet Union. Of course, this decision can be made provided that the Government of Afghanistan requests that the international community financially support the Kyrgyz Republic in this endeavor. We are also interested in other forms of cooperation, including importing goods from Afghanistan that are in demand in the Kyrgyz Republic. After the internal political situation in our friendly country is under control, we will be ready to conclude concrete agreements with Afghanistan in areas of mutually beneficial partnership, both at the governmental and ministerial levels as well as in the administrative and territorial units and the private sector Relevant agreements can be signed in multilateral and regional formats as well. Distinguished Ladies and Gentlemen! I am confident that the decisions made at this conference will comply with the interests of Afghanistan, its people and all participants of the Bishkek conference. They will not only reconfirm the common goal to consolidate the processes in the region, but also help us to make practical use of the mutual cooperation capacity for the sake of our countries and peoples. I wish you all a very successful outcome to the conference.
Thank you.
List of Official Delegations
United Nations Development Programme (UNDP)
Headquarters delegation © DP Mr. Mark Malloch Brown, UNDP Administrator Mr. Kalman Mizsei, Assistant Secretary General Regional DirectorRegional Bureau for Europe and CTS Mr. David Lockwood, Deputy Regional Director Regional Bureaufor Asia Pacific Ms. Gulden Turkoz -Cosslett, RBEC Cluster -1, Senior ProgrammeManager Ms. Shoko Noda, Personal Assistant to Administrator
AFGHANISTAN Government Delegation H.E. Ashraf Ghani, Minister of Finance, Ministry of Finance Mr. Mohammad Dindar, Chief of Staff, Ministry of Finance Mr. Besmullah Kamawi, Head of General Customs, Ministryof Finance Mr. Mohd Bagar, Special Assistant to the Minister, Ministry ofFinance Mr. Sayed Mustafa Kazemi, Minister of Commerce, Ministry ofCommerce Mr. Ghaus Mohammad Bahir, Director of Trade Department,Ministry of Commerce Mr. Said Shafic. Gawhari, Adviser to the Minister, Ministryof Commerce Mr. Reinhard Palm, Adviser to the Minister, Ministry of Commerce Mr. Noorullah Delewari, Chief Executive Officer, AfghanInvestment Support Agency (AISA), Ministry of Commerce Dr. Ghulam Jelani Jelis, Deputy Minister, Ministry of Powerand Water Mr. Mohammad Hashim Payman, Head of Planning, Ministryof Communications
Private -Sector Delegation Mr. Gholam Daud Nassib, Nassib Edible Oil Company Mr. Mohamad Rafiq Ahmadyar, Director, TNT Afghanistan ,rr Mr. Haji Hafizullah, Habib Hafiz Ltd. Mr. Hamid Qaderi, Qaderi Transport Ltd. Mr. Amin Karimzad, CEO / Director, Aman Karimzada Ltd./Kabul Chambers of Commerce Mr. Kabir Arghandiwal, Scimitar Global Ventures, UAE Mr. Kamaluddin Gulam Nabi, Kamal Nabizada Co. Inc Mr. Habibullah Gulzar, Habib Gulzar International LLC., UAE Mr. Zaher Yaqubie, ARC Companies Mr. Gulyam Sakhi, Private Sector
UNDP Delegation Mr. Ercan Murat, Country Director, UNDP Afghanistan Ms. Cherie Hart, Regional Communications Officer, UNDP Thailand Mr. Hugh Riddell, Consultant, UNDP Afghanistan Ms. Paula Newberg, Consultant, UNDP Afghanistan rIRAN
Government Delegation Mr. Mohammad Shariatmadari, Minister of Commerce, Ministry ofCommerce Mr. Khazaei, Deputy Minister of Economy and Finance, Ministry ofFinance Mr. Mashaherefard, Deputy Head of Main Directorate of International,Ministry of Economy Mr. Bigdeli, Chairman of Afghanistan's Headquarters Mr. Kohzadi, Chairman of Export Guarantee Fund of Iran Mr. Seif, Chairman of National Bank of Iran, National Bank of Iran Mr. Asadian, General Director of Ministry of Commerce, Ministry ofCommerce Mr. Saedi, General Director and Head of Administration of Minister ofCommerce, Ministry of Commerce Mr. Zaafarani, Deputy of National Bank, National Bank Mr. Naraghi, Representative of Protocol Department
KAZAKHSTAN
Government Delegation Ms. Zhanar Aitzhanova, Vice Minister, Ministry of Industry and Trade Mr. Rustem Khamzin, Director, Dept of Intl Economic &FinancialRelations, Ministry of Economy, Ministry of Economy and Budget Planning Mr. Rustem Zhumataev, Head of Division, Ministry of Transport Mr. Erzhan Mukash, Director of Department, Ministry of Foreign Affairs
Annexes Mr. Miraz Kasymov, Head of division, Ministry of Industry and Trade
Private -Sector Delegation Mr. Viktor Yambaev, President, Almaty Association of Entrepreneurs Mr. Munavara Paltasheva, Director, Almaty Association of Entrepreneurs Mr. Maral Tompiev, President, Universal complex "Medina ", Almaty Mr. Serik Turjanov, Director, Department of Small Business, Almaty Mr. Din Kim, Director of Almaty branch, JSC "AgromashHolding" Mr. Bekzan Beishembekov, Marketing Manager, JSC "AgromashHolding"
UNDP Delegation Mr. Fikret Akcura, Resident Representative, UN DP
Kyp(T,v?q-rA.n!
Government Delegation H.E. Askar Akaev, President of the Kyrgyz Republic Mr. Imil Akkoziev, Advisor to President Mr. Nikolay Tanaev, Prime Minister Mr. Melis Satybekov, Deputy Head of Prime Minister Apparatus, Prime Minister Apparatus Ms. Cholpon Ibraimova, Head of Department of International Cooperation, Prime Minister Apparatus Mr. Djamalbek Turgunbekov, Adviser of International Cooperation Department, Prime Minister Apparatus Mr. Kubanychbek Jumaliev, Minister, Ministry of Transport and Communications Mr. Alikbek Djekshenkulov, Deputy of the Head of President Administration,President Administration Mr. Joomart Otorbaev, Vice Prime Minister Mr. Edward Edgaro, Advisor of Vice -Prime Minister, Secretariat of Vice Prime Minister Mr. Askar Aitmatov, Minister, Ministry of Foreign Affairs Mr. Talantbek Kushchubekov, First Deputy Minister, Ministry of Foreign Affairs Mr. Mamkulov Erkin, Deputy Minister, Ministry of Foreign Affairs Mr. Amangeldy Muraliev, Acting Minister, Ministry of Economic Development,Industry and Trade Ms. Nina Kirichenko, Deputy Minister of Economic Development, Trade and Industry, Ministry of Economic Development, Trade and Industry Mr. Murat Ismailov, Deputy Finance Minister, Ministry of Finance Mr. Mukhtar Djumaliev,First Deputy Minister, Ministry of Economic Development, Industry and Trade Mr. Aizat Ajikeev, Deputy Minister, Ministry of Transport and Communications Mr. Anvar Tursunov, Chairman, State Committee on Architecture and Construction Mr. Akylbek Tyumenbaev, Deputy Director, State Agency on Energy under the Government Ms. Chinara Ibraimova, Ministry of Finance Mr. Asylbek Aidaraliev, Advisor to the President, Chairman of the National Center of Development of Mountain Regions of the KR Mr. Temursho Akbarov, Advisor, Trade Representative of Kyrgyz Republic in Afghanistan
Private -Sector Delegation Mr. Boris Perfiliev, President, Chamber of Commerce and Industry Mr. Jyrgalbek Surabaldiev, President, The Union of Entrepreneurs "New Step" Mr. Emil Umetaliev, Chairman, Business Association Mr. Kubanychbek Kasymaliev, President, Association of Exporters Mr. Iliya Bessmertny, General Director, JSC "Kant Cement -Slate Factory" Mr. Nurdin Abdyldaev, General Director, "Interglass" Ltd Mr. Sergey Slepchenko, Director, Bishkek Chamber for Trade Promotion Mr. Eduard Rausch, General Manager, REEMTSMA Kyrgyzstan
UNDP Delegation Mr. Jerzy Skuratowicz, Resident Representative, UNDP Mr. David Akopyan, Deputy Resident Representative, UNDP Mr. Wojciech Hübner, Economic Reforms Advisor in Central Asia, UNDP Mr. Leonid Komarover, Senior Policy Adviser, UNDP Ms. Gulnara Abdyldaeva, Operations Manager, UNDP Mr. Arkady Divinsky, UN Coordination Associate, UNDP Mr. Edem Bakhshish, Assistant Resident Representative, UNDP Ms. Olga Grebennikova, Public Relations Officer, UNDP Ms. Aikan Mukanbetova, Programme Officer, UNDP Ms. Nazik Umuralieva, Administrative Assistant, UNDP Ms. Mia Rimby, Programme Officer, Governance Unit, UNDP Mr. Rahim Ismailov, Assistant to Economic Reforms Advisor, UNDP Ms. Ludmila Kim, Executive Secretary of the Conference, UNDP Ms. Medina Kalygulova, Reception, UNDP Mr. Alain Scolan, Head, BOMCA/CADAP Mr. Paul Grassi, Deputy Head, BOMCA/CADAP Mr. Talaibek Usubaliev, Country Manager in Kyrgyzstan, BOMCA/CADAP Mr. Djangarachev Chingiz, Deputy Country Manager in Kyrgyzstan,BOMCA/CADAP Ms. Mira Djangaracheva, NCSA Mr. Mircea- Iulius Onita, Expert, Investment Round Table Secretariat
PAKISTAN
Government Delegation H.E.. Tariq Ikram, Minister, of State and Chairman of the Export Promotion Bureau Mr. Zia ul Haq, Additional Secretary, Economic Affairs Division Mr. Zafar Qadir, Joint Secretary, Ministry of Commerce Dr. Hammad Uwais Agha, Deputy Secretary, Economic Affairs Division Mr. Ahmad Farooq, Deputy Secretary, Ministry of Commerce Mr. Khurshid Ali Chauhan, Assistant Chief (ECO), Economic Affairs Division Mr. Liaquat Ally Agha, Collector of Customs, Customs House, Peshawar Mr. Fida Muhammad, Deputy Secretary, Ministry of Communications Mr. Muhammad Naeem, Managing Director, Modern Pipe Mills Ltd,Lahore Mr. Muhammad Tariq Iqbal Mughal, Director, Mughal Steel
Private -Sector Delegation Mr. Bashir Ahmad, General Manager, National Engineering Services, PakistanLtd. Mr. Kalim Ahmed Mobin, General Manager Marketing, Lucky CementLtd Mr. Jawaid Altaf Shaikh, Export Manager, Geofman Pharmaceuticals
UNDP Delegation Mr. Önder Yücer, Resident Representative, UNDP
TAJIKISTAN
Government Delegation Mr. Saidullo Rakhimov, Deputy Minister of Transport, Ministry of Transport Mr. Isroil Mahmudov, Deputy Minister of Economy and Trade, Ministryof Economy and Trade Mr. Alexei Silantev, First Deputy Minister of Energy, Ministry of Energy
Private -Sector Delegation Mr. Sharif Saidov, Chairman, Chamber of Commerce Mr. Komil Kholikov, Commercial Director, OJSC "Avicenna"
UNDP Delegation Ms. Mia Seppo, Deputy Resident Representative, UNDP Mr. Arto Immonen, Programme Officer, UNDP Ms. Anna Matveeva, Regional Adviser on Peace and Development in Central Asia, UNDP
TURKMENISTAN
Government Delegation Mr. Chary Niyazov, First Deputy Minister, Ministry of Foreign Affairs Mr. Akmurad Mamedov, Chief of Budget Department and Financing, Ministry of Finance
UNDP Delegation Mr. Khaled Philby, Resident Representative, UNDP fUZBEKISTAN
Government Delegation Mr. Alisher Salahitdinov, Ambassador of the Republic of Uzbekistan in Kyrgyz Republic Mr. Parviz Aliev, Head of Department, Ministry of Foreign Affairs Mr. Abdujalil Abdujabarov, Head of Department of the Transport Maintenance, Agency of External Economic Relations
Private -Sector Delegation Mr. Samariddin Ibragimov, Chairperson of Management, "Sharq Plast Service" Mr. Alisher Niyazmatov, Head, Bresona Investments LLC Mr. Vyacheslav Sohibnazarov, Commercial Director, Avialeasing Aviation Company Mr. Vadim Berdyanskiy, Manager, "Agrotech" Inc. (USA) Mr. Djamshid Razakov, Director, "Marogand" Company
UNDP Delegation Mr. Erick de Mul, Resident Representative, UNDP Mr. Bakhodur Eshonov, Programme Analyst, UNDP
Annexes Mr. Alastair McKechnie, Country Director for Afghanistan, The World Bank Group Mr. Chris Lovelace, Country Manager, Kyrgyz Republic Mr. Simon Kenny, Regional Coordinator, Central Asia Mr. Asian Sarinzhipov, Operations Officer, WB Central Asia Regional Office, Kazakhstan Mr. Serdar Jepbarov, Operations Officer, WB Country Office, Turkmenistan
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Dr. Frank Polman, Senior Advisor, South Asia Department and Special Representative to Afghanistan, ADB, Philippines Mr. Rajiv Kumar, Principal Economist, ADB, Philippines Mr. Hideaki Iwasaki, Project Specialist, South Asia Transport and Communications Division Asian Development Bank, ADB, Philippines
Mr. Askhat Orazbay, Secretary General, ECO Iran Mr. Isik Orhan, Deputy Secretary General (Trade and Investment), ECO Iran Summaries of Discussions
Working Group 1- 10 May 2004 Afghanistan: a new regional player Rapporteur: Mr. Talantbek Kushchubekov First Deputy Minister of Foreign Affairs, Kyrgyz Republic
The Working Group met to discuss Afghanistan's role as a bridge between Central and South Asia; incentives for regional trade and investment in Afghanistan's reconstruction and recovery; and prospects for regional cooperation on a wide range of issues critical to the future growth of the entire region. The working group was chaired by the Chief Executive Officer of the Afghan Investment Support Agency, and recommendations listed below. In was facilitated by a UNDP senior particular, it considered: trade, transit and consultant. travel; security and regional trade; regional investment and communications; The Working Group noted that national economic reform; social and Afghanistan has taken enormous strides in economic progress; entrepreneurship; border relationships; migration and labour; training and capacity building; information sharing across borders; parallel economies and narcotics; transparency and anti -corruption policies; the importance of civil society participation; enhancing the role of women in reconstruction and recovery; the role of regional organizations in promoting regional prosperity; and more generally, the evolving concept of regional its reconstruction and recovery during the relations across the previous divides of past two years. Nonetheless, it took its South, Central and West Asia. Delegates guidance from the Afghan delegation, paid particular attention to the which suggested that the future for both intersections among these policy arenas. Afghanistan in particular as well as the . >r region as a whole lies in the "big picture ". On the basis of these discussions, the The Working Group therefore discussed a Working Group proposes to the region's number of broadly gauged subjects to governments and participating multilateral provide a context for the specific institutions the following initiatives:
Annexes -* Foster regional cooperation on poverty Cooperation Organization; supporting reduction, urgent social programs, good Afghanistan's membership in the World governance and post- conflict recovery: Trade Organization; expanding the Working Group underscored the need institutional capacity to support to create regional capacity for comparative microfinance and other forms of capital analysis of social policy, with particular flow for the poor; strengthening and expanding the number of bilateral economic commissions; and exploring the creation of regional economic zones. In addition, the group noted the special imperatives to rationalize public -private cooperation across the region and promote private- sector -led growth. The Working Group noted that improved cross -departmental links within multilateral organizations would make it easier for those institutions to assist the attention to economic and social region's development more effectively. vulnerability, family planning and Build human capacity and conduct integrating poverty indicators into training in Afghanistan and the region in regional economic planning. Capacity- order to sustain Afghanistan's recovery building areas include statistical analysis, and promote economic growth across the policy benchmarks, human development region; the Working Group noted the indices, and sponsored research on behalf regional economic benefits of linking of international institutions. training to investment and including Regional cooperation in reaching women in all aspects of recovery and Millennium Development Goals can be training for their participation in expedited through joint statistical and reconstruction. The Working Group analytical activities, including cross - noted that labour migration, with regional human development reporting. appropriate employment protections, is a critical element of economic growth in the Develop regional institutions and region, and therefore proposes a joint strengthen existing cross -border organi:atiorts in order to accelerate regional economic cooperation: the Working Group noted the existence of effective regional organizations, including new institutions created under the auspices of the international community, but emphasized nonetheless the need to encourage regional engagement in Afghanistan's social and economic recovery by harmonizing national regulations that can promote investment in commission, facilitated by the WTO and Afghanistan.' the ILO, to create mechanisms to promote such migration. Such initiatives include strengthening standard -setting activities of the Economic The group proposes the creation ofa The flexibility and reliability of web- regional commission on education and based procurement is one way toensure vocational training, with representation transparency, accountability and uniform from each participating government and standards in reconstruction- related relevant civil society organizations. investment. The group noted the recent success of the Connecting fibre -optic networks across Central Asian Association of Universities as a coordinating body for higher education and its value as a model to coordinate the region's contributionto advanced training for Afghans. The group noted the importance of undertaking innovative programs to train refugees prior to repatriation andurges the international donor community to respond to the region's interest in such capacity- building endeavours. the region will enhance communication, Foster greater communications v ititin knowledge sharing and investment. the region:the group noted the importance of cross -border In general, the group proposed that the communication, not only to increase region undertake regular meetingson specific policy issues, and, whenever mutual understanding but also to help create conditions for secure trade and possible, review the experience of investment. To take advantage of open participating states on issues related to communication environments, the group reconstruction and recovery. The group also proposed that the international community, particularly UNDP, the World Bank and the Asian Development Bank, foster these activities on behalf of the region's governments and citizens.
encourages broad media coverage across the region. In pursuit of the free flow of information, the group calls upon the United Nations and other regional actors to help bridge the information gap ion economic conditions, investment and trade, all of Which could have an important impact on regional communication systems.
Annexes Working Group II - 11 May 2004 Trade policy and trade facilitation Rapporteur: Mr. Kabir Arghandiwal, Scimitar Capital Partners Chairman: Ishik Orhan, ECO, Deputy Secretary General (Trade and Investment) Facilitator: Alastair McKechnie, World Bank, Country Director for Afghanistan
Deepen and widen information Land availability and regulation exchange Investment opportunities, particularly in the fields of agriculture and agro- Background: processing A lack of information was seen as an Land Propriety obstacle for trade and investment Credit opportunities in the region. ECO is starting a portal for business Recommendation: opportunities in June 2004, called ECO Information about trade and investment regulations and opportunities should be provided by national and regional organisations. The internet should be used more actively in this regard. Private -sector organisations are vital for disseminating the information to investors and traders. For Afghanistan, AISA (Afghan Investment Support Agency) should deliver this information. Governments and donors (e.g. in the Afghan reconstruction process) should announce their tenders more actively to regional players. Trade Net. The participating countries Information should be available in English should assign focal points (trade and Russian. promotion agencies) to feed the information. Issues under discussion: The International Trade Centre (ITC) is Information was deemed lacking for also launching an information- exchange Afghanistan and 'other countries in the project, called Maragand, for the Central following fields: Asian Region. Investment laws The Chamber of Commerce has a crucial Investment guarantee schemes (e.g. Kyrgyzstan) showed firm interest in signing the agreement. The annexes on Rules of Origin, the Negative List and the Anti -Dumping rules will be finalised in 2004. After the finalisation of the annexes, the ratification process will start. The High -Level Expert Group adopted a fast- track approach for reducing the maximum tariffs down to 10 %, covering 80% of the role to play in information dissemination. traded goods within five years; for The revived ECO Chamber of Commerce Afghanistan the reduction must be met should be active in this regard and after 15 years. The next meeting is in June in Islamabad. integrate the diversity of business organisations for information The ECO Trade Agreement was also seen dissemination. as a step towards WTO membership so far It was also recommended that information only Kyrgyzstan, Pakistan, Turkey are members. Witli the exception of exchange be increased among the Afghanistan and Turkmenistan, all other Investment Promotion Agencies in the region. ECO members have applied for WTO membership. There is scope for mutual ADB will support Trade Information cooperation in WTO application among Centres in the region. It was the participating countries. recommended to ADB to consider ECO Transit Trade Agreement: Signed by integrating all participating countries into this process, particularly Afghanistan. nine member countries; ratified by eight countries, agreement in force. Reinforcing the implementation of ECO Transit Transport Framework ECO agreements Agreement: Signed by eight member countries and ratified by five member Background countries. It will become effective after The already existing and upcoming ECO the ratification of one more country. agreements are seen as the most important tools to strengthen the trade ties among Bilateral trade treaties to the countries participating in the complement, deepen and ensure conference. implementation of multilateral/ Recommendation: regional trade agreements Timely ratification and implementation of Background: existing and planned ECO agreements by Bilateral and regional trade agreements all participating countries was should be mutually supportive. recommended to enhance regional cooperation and trade. Recommendation: Issues under discussion: Bilateral treaties and regional trade and ECO Trade Agreement: Signed by five investment agreements should be mutually members (Pakistan, Iran, Afghanistan, supportive and should be developed Turkey and Tajikistan). More countries coherently. It may be possible for faster
0:$ I Annexes progress to be made through bilateral risk -management systems in customs agreements, and these should be designed clearance and the application of TIR to be consistent with the emerging procedures should be treated as priorities multilateral agendas. for trade facilitation. Customs reform should be given priority along the transport corridors.
Issues under discussion: The usage of international tools for customs procedures in the regions was recommended. In particular: Harmonized systems for customs tariff lines. Application of ASYCUDA (Automated System for Customs Data) Issues under discussion: 4 Regional and multilateral trade and Facilitating visa procedures investment treatments are seen as the Background: best solution to enhance trade and investment in the long term. The existing visa procedures for businesses are seen as still too - Bilateral treaties are seen as critical, as cumbersome to serve the needs of the they can often improve the framework private sector. In particular, the visa for trade and investment faster and procedures of some Central Asian deeper than regional agreements. countries are seen as too slow and costly. 4 Bilateral treaties should contribute to solving trade- related tax questions. Recommendation: Faster and streamlined visa procedures are 4 Bilateral treaties should address the needed to facilitate trade and investment following issues: in the region. Countries participating at Elimination of negative lists and the conference were urged to liberalise import bans. visa formalities for legitimate business people and transport personnel. A working Enhancen%ent of cross -border trade. group incorporating government officials and private- sector representatives should Customs procedures be formed to solve the remaining Background: problems. Despite ongoing efforts, the customs procedures in the region are still seen as the major obstacle to increasing intra- regional trade.
,Recommendation: Harmonization and simplification of customs procedures, development of border post facilities, data consolidation and use of IT for transit, development of Issues under discussion: Issues under discussion: As a standard, it was proposed that 4 All participating countriesare willing multiple -entry visas lasting one year to strengthen their cooperation to make should be issued for business people and main transit corridors more effective. transport personnel. 4 Corridors are seen as one tool to Chambers of Commerce should act as promote trade facilitation among counterparts for the visa -issuing countries with a mutual interest in authorities to confirm the eligibility for more -efficient transit arrangements. business visas. Agreements reached around corridors In some countries, visa procedures are could be a model to facilitate trade in slowing down business contacts. Several general. cases were reported in which business 4 Corridors allow measuring the impact of trade facilitation easier by facilitating the assessment of transport times.
Promote trade pro -actively Background: Trade promotion activities in the region are seen as insufficient.
Recommendation: opportunities couldn't be taken because of The trade promotion activities of the cumbersome visa procedures. participating countries should be ECO should elevate this problem at its strengthened and better aimed at the ministerial meeting. Information should be partners in the region. gathered from Chambers of Commerce. One -year multiple -entry visas should be Issues under discussion: issued as the norm. It was recommended to integrate the private sector more actively in such Solving regulatory issued around activities. corridors The activities should build upon ongoing Background: activities of the private sector and implemented as public -private High interest was shown in solving partnerships. infrastructure and regulatory problems to make suggested transit corridors operational.
Recommendation: Multilateral working groups should be formed to solve infrastructure and regulatory bottlenecks along the main transit corridors in the region. Donor agencies, in particular the World OPIC, a US investment guarantee and Bank and the International Trade Centre, equity capital agency, is operational and is were encouraged to assist with trade expanding its activities after the signing of promotion. an Afghan -US bilateral agreement in April 2004. Reinforcing regional investment Other bilateral schemes (e.g. with promotion as to reinforce regional Germany) are available. trade Monitoring of results by private Background: sector Investment and trade are seen as two sides of the same coin. Promote moderate, Background: simple, transparent taxes for all The implementation of the existing trade businesses, including joint ventures. and investment agreements was seen as insufficient. The private sector has an Recommendation: interest in implementing trade and Trade and investment promotion should investment reform and should mobilise to be strengthened together. secure results.
Issues under discussion: Recommendation: Trade and investment promotion activities The private sector should take a lead role are mutually reinforcing and should in monitoring the implementation and therefore be undertaken in a mutually impact of the existing agreements and the beneficial way. resolutions of this conference. Benchmarks should be created to monitor Investment guarantees and risk the implementation of the existing regional agreements, in particular the insurance ECO agreements. An ongoing dialogue Background: between the private sector and the The lack of investment risk insurance is governments of the regions should be seen as a major obstacle to more established to ensure the effective investment, particularly in Afghanistan. implementation of the agreements. This dialogue could be supported by the Recommendation: revived ECO Chamber of Commerce in Schemes for investment guarantees should collaboration with other interested become operational soon and their usage business organisations in the region. promoted, particularly for small and Donor organisations are encouraged to medium enterprises. support these activities.
Issues under discussion: The MIGA risk insurance schemes will become operational shortly in Afghanistan. A1SA will work as the national contact point. A special system to facilitate the use of MIGA's instruments in
Afghanistan is supported by the World lorm' ,it 111111111r+dell. .I Bank, MIGA, ADB, Germany and other donors. Áit, sr i "a i' 2004
Rapporteur: Mr. Hamid Qaderi Chairman of Qaderi Transport
Considering the central and vital role of logistics in Termez /Khairaton and Afghanistan as a hub of trade, investment Kushka could be included in the and transit, it was agreed by the agenda of the next meeting. participating delegates of the Working Group that Afghanistan's security is Improved communication, information critical to the security of the region. sharing and improved access to data Investment in Afghanistan shall be were stressed as vital for regional trade. considered as a national investment in the countries of the region. It was agreed that matters related to transport and transit would be tackled on both the bilateral as Arrangements for power sharing in the well as the multilateral levels. region shall be discussed in future The group cited the following measures conferences. and recommendations as top priorities: Mode of 4 Harmonization of procedures and simplification of trade and transit, Renovation of roadways is a priority for which include: Afghanistan. 3 Visa facilitation To enhance regional trade and transit involving the Central Asian countries, 4 Harmonized taxation and tariffs in multimodal transportation means will be order to increase competitiveness involved. 4 Safety of transit routes Air connectivity should be also be considered as a priority. Kabul could be a 4 Non -discriminatory treatment for regional hub for air routes. transit goods 4 Joint border check -posts
4 Border -post infrastructure to be While the major directions run north- improved through the national revenue south, east -west routes are to be and through international assistance, considered, as well, especially in terms of with active participation from the linking countries beyond the region (e.g. private sector of each country China). 4 Creation of a regional transportation Distance is not equivalent to costs. Time is company involving the private sector the key component of costs. from the countries of the region. The Future trade and transit would depend on arrangements for setting up the the diversification of industrial production company could be an issue for the next and export in the countries of the region. meeting. 4 Possibility of establishing centers of Coordination with regional Capacity building and skills institutions and agreements development It was stressed that ECO, as one of the Capacity building for government major regional institutions, would also institutions involved in trade and transit take the recommendations of the group regulation is essential. Each country shall into consideration. consider issues of capacity building of its private sector and view the private sector Private sector as a main vehicle for economic development. A permanent regional committee consisting of the private sectors of the Follow -up respective countries shall be formed to monitor the follow -up of the decisions and While stressing the importance of the recommendations of the Bishkek Bishkek Conference as a landmark for Conference. Representatives of the private bringing together the governments and sector should meet regularly. International private sectors of the region, it was organizations (UNDP, ADB, WB and suggested that the next two venues for other institutions) will be encouraged to similar conferences should be Tashkent consider the possibilities of technical and Almaty. assistance and support.