Taliban says it signed mining deals worth over US$6.5B

Afghanistan’s Taliban has signed seven mining contracts that would bring roughly US$6.5 billion in investments to the ruling government, the Associated Press reported on Thursday. This figure, AP says, represents the biggest round of deals made by the Taliban since they toppled the government of former president Ashraf Ghani and the United States withdrew its military forces in 2021.

According to AP, the contracts are with local companies, many of which have foreign partners in countries including China, Iran, and Turkey. The contracts include mining and processing of iron ore, lead, zinc, gold and copper in Herat, Ghor, Logar and Takhar provinces.

A separate report by Voice of America showed that a televised signing ceremony took place on Thursday, featuring Taliban’s minister of mines and petroleum Shahabuddin Dilawar and certain Chinese investors.

In an official statement, Dilawar said that the agreement with a Chinese company for gold extraction in Takhar would bring the Taliban government a 65% share of the earnings over five years.

He added that other contracts involving Turkish, Iranian and British investments related to mining and processing iron ore in Herat would earn the government a 13% share over 30 years. “It will eventually turn Afghanistan into an exporter of iron,” he said.

No further details were given by the Taliban on the contracts, only that “they would create thousands of jobs and significantly improve the economic situation of the country” and result in over US$6.5 billion in foreign investments.

Since reclaiming power in August 2021, the Taliban has been courting foreign investment to revitalize Afghanistan’s economy, leveraging the nation’s vast amount of mineral resources that remain largely untapped to date.

Tamim Asey, a former official with the Afghan ministry of mines and petroleum, is skeptical of the Taliban’s new dealings, calling the announcement “mere propaganda.”

As someone who worked at the Ministry of Mines and Petroleum I can assure you this is mere propaganda because:

a. The #AFG financial and banking sector is almost paralyzed and disfunctional. Hence, no financial transactions or valuations.

b. The legal-policy framework for 1/4. https://t.co/iQutGaYTQM

— Tamim Asey – تمیم عاصی (@tamimasey) August 31, 2023

“The Afghan financial and banking sector is almost paralyzed and dysfunctional. Hence, no financial transactions or valuations,” he wrote in a thread on X (Twitter).

“The legal-policy framework for the mining sector is not only vague but almost nonexistent. The regime doesn’t even have a constitution, let alone mining legal framework.”