Afghanistan has been in and out of the global spotlight for almost a century now. More than often, for the wrong reasons. But rarely are any of those reasons even remotely related to the economy of the nation. Apart from opium exports, most people are of the
(justified) opinion that the Afgan economy is not worth discussing, & certainly not important enough to write articles about. But they would be wrong. The Afghan economy very much deserves our attention. Or, to be more precise, the mineral wealth of 3 Trillion dollars, which will soon be running it.
The Relevance of Rare Earth Elements
On the center of the periodic table, there is a square representing a dozen elements called the lanthanides. When mixed with certain chemicals, these lanthanides become rare Earth elements. Although required only in excruciatingly miniscule quantities, rare Earth elements power our world. Everything from laptops to solar panels to nuclear missiles use them. Therefore, whoever controls the supply of rare earth elements in essence controls the production of any technology across the world, be it military or civilian. It is the discovery of these elements, in large quantities in Afghanistan, that has triggered a new excitement. After all, the demand for rare earth elements is predicted to grow exponentially, and Afghanistan, for one, could really use the money. Research into what lay beneath Afghanistan's mountainous terrain started under the Soviet invasion of the country. Soviet surveyors secretly tried to gauge the mineral content of Afghan soil. They discovered mineral wealth of around a trillion dollars. This reinvigorated their enthusiasm, and gave a new reason for the continued Soviet occupation of the country. Work began on various infrastructure projects to extract this wealth, however with the sudden withdrawal of the Soviet forces under Gorbachev, most of this came to a standstill. Scientists in charge of this research hid these documents, and published them only in 2007 after the withdrawal of the Taliban. after the US invasion of the Americans built on Soviet research and raised the estimated value of Afghan wealth to 3 trillion dollars. Most of this value was derived from the presence of rare earth elements, the production of which was previously monopolized by China.
Over the years, China has displayed its willingness to use rare earth elements as a tool to politically subjugate other Nations. In a dispute with Japan, China was able to bring the American ally to its knees by stopping the export of rare earth elements to the nation. Across the Pacific, the "Land of the Brave" watched helplessly, too scared to intervene. The memory of this rather embarrassing incident has certainly motivated the United States to search for alternative sources of rare earth elements. Furthermore, the Pentagon is eager to remove its dependence on China for the production of defence hardware.
Moreover, if Afghanistan is able to help America reduce its dependence on China, it can partially help justify the longest war in American history, which has claimed thousands of lives and almost 700 billion dollars in taxpayer money. And although resource extraction is a dubious reason to justify military occupation, it will be a tiny saving grace in the costliest war of the century.
Despite being the world's largest manufacturers of rare earth elements, China does not in fact, possess the world's largest reserves of the same (In an act of admirable foresight, the Chinese had already amended their environmental laws to allow the production of rare earth elements while strategic thinkers in other democracies *cough India cough* had not even realised their importance). This means that manufacturing can only be optimised to a certain level, after which the Chinese simply cannot extract more material from their soil. With growing demand for rare earth elements both in China and abroad, we have already seen the repercussions of this, where large increases in domestic consumption have reduced China's overall exports of rare earth elements.
This is where Afghanistan comes in. If one looks at the world map, one will note that Afghanistan falls right on the crossroads of China's belt and road initiative. If it were to join the Chinese alliance, to a layman, it would seem that a lot of Afghanistan's woes would be solved. That is why Chinese companies (state owned off course) had already signed contracts with the Afghan government for mining rights all the way back in 2007.
Industrialization, however, is not such an easy task. Especially in the graveyard of empires. Corruption, conflict and geography have held Afghanistan back thus far. There is not adequate water to support an industrial economy, and the electricity supply is far too inadequate. However the biggest issue is transportation. Raw materials are high volume low density goods, therefore transport networks need to be efficient and cheap for extraction to be profitable. Currently, certain artisans do mining and transportation of these materials by hand, but this method will not be able to support rare earth elements mining. Railways are necessary for a large-scale mining operation. A single large scale rail development project will not do the trick. Minerals are not found in large quantities anywhere in Afghanistan. Instead they are present in small pockets all over the country. But the government has little to no control of the countryside, where the Taliban roams freely. Under these conditions, it is doubtful that any private investor would risk developing infrastructure on the treacherous terrain.
This brings us to the second issue. Most Afghan ocean-bound trade has to pass through Pakistan, a country with which it does not have very positive relations. Both of them routinely accuse each other of political interference and have regular border conflicts. Trade routes through the Caspian sea and Iran are not an option. However, Afghanistan cannot portray a sudden comradery with Pakistan via joining China's belt and road initiative, because that is sure to provoke reaction from the United States.
But all is not bad. A new peace deal between the United States government and the Taliban suggests that peace is in sight (with a certain side lining of the Afghan government). Moreover, the United States has asked Turkey to help with the negotiations. Ankara is trusted across all levels of Afghan society and Afghans share a strong cultural bond with the Turks. However, many sources indicate that Chinese diplomats are trying to undermine the United States by negotiating with the Taliban through backdoor channels created by Pakistan (The evidence on the issue is not concrete, but one can be sure that some equivalent of such meddling is indeed occurring).
Therefore, Kabul has to come up with a deal that will satisfy the United States, China, Iran, Turkey, Pakistan and Russia. At the same time it also needs to please its own people and deal with rampant corruption and conflict within Afghanistan itself. This has to be synchronized with rapid infrastructure development projects throughout the country. Afghan politicians do not have the luxury of focusing on only one issue at a time, because if they do so then the others will certainly spin out of hand. This promises to be a daunting task, and will require an almost Bismarckian level of statesmanship.
If used wisely, rare earth elements present a metaphorical goldmine for the Afghan's, a light at the end of a century long tunnel of darkness. However, as Nigeria, Syria, Iran, and Venezuela have repeatedly shown us, a nation blessed with underground wealth cannot be certain of its long-term success. It will bode the people of Afghanistan well to remember: "the wealthy and powerful nations of the world are built because of gold mines, but they are rarely built on top of them"-Chevron, Caspian Report.