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Challenges & Responses to Conflictual Politics

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KABUL, Afghanistan — America may be struggling to come up with a viable exit plan for Afghanistan, but Abdul Wasay Manani is sure of his.

The broad-set Afghan butcher spent the past seven years trucking cattle in from the Pakistan border and building a thriving business for himself and his family, serving up some of the best hamburgers in Kabul for the embassies and expatriates and their barbecues.

But this month, Mr. Manani, 38, flew to India for 14 days to scout out a new business, and a new home, ready to leave Afghanistan and everything he worked to build here, just in case things fall apart when most Americans and other foreign troops leave in 2014. “If the Taliban come like last time, ordering people around with whips, I can’t stay here,” he said. “I have to leave this country to keep my family safe.”

Many Afghans share his concern. Interviews with business owners, analysts and economists paint a picture of extreme anxiety in both the domestic and international business communities here as the Afghan-United States relationship deteriorates and as the Western drawdown begins.

In this environment, troubling indicators are not hard to find. More than 30,400 Afghans applied for asylum in industrialized nations in 2011, the highest level in 10 years and four times the number seeking asylum in 2005, according to provisional figures from the United Nations. Meanwhile, the number of displaced Afghans outside the country seeking to come the other way slowed to 68,000 last year,

down from 110,000 in 2010 and a big decrease from the 1.8 million Afghans who repatriated in 2002, the year after the Taliban were driven out of power.

The only Western bank operating here said on Wednesday that it would be leaving. Piles of cash equaling about a quarter of Afghanistan’s annual economic output were physically carried out of Afghanistan last year. Fewer foreign companies are seeking to do business here, and those already here are downsizing and putting off new investments. And there are businessmen like Mr. Manani who already have a foot out the door, working actively toward a Plan B for life and business outside Afghanistan.

Senior Afghan officials are acutely aware of it, and are alternately worried and angry. “Sometimes I hear that some businessmen are fleeing and moving their businesses to outside Afghanistan,” President Hamid Karzai said at a news conference this month. “Curses be upon such businessmen that made tons of money here and now that the Americans are leaving they flee. They can leave right now. We don’t need them.”

Given the importance of trying to bolster economic independence in the overall plan for Afghanistan, the skittish responses and decreasing investment and hiring strike right at hopes that this impoverished nation, still barely on the cusp of modernity, can thrive on its own.

Large companies are expressing worries about security. One of the most significant is Standard Chartered, the only big Western bank with a branch in the country, which said Wednesday that it was turning over its operations to a local Afghan bank and withdrawing mainly because of deteriorating conditions.

Mohammad Qurban Haqjo, chief executive of the Afghanistan Chamber of Commerce and Industries, said the head of one of the country’s four big cellphone companies had told him that he planned to take his investments out of the country after 2014.

“It is still two years to go, but we are hearing from our businesses that everybody is raising this question,” Mr. Haqjo said.

Even those who are trying to stay, foreign companies in particular, have become very conservative. According to the Afghanistan Investment Support Agency, capital spending by foreign companies newly registered in the past year, at $55 million, was the lowest rate in at least seven years, and about one-eighth the rate’s peak in 2006.

According to Masuda Sultan, an Afghan-American businesswoman who grew up in Queens, the caution is expressing itself in businesses that are downsizing work forces, for example, or holding off on new investments.

“Among the people I know, there is planning going on in terms of investment decisions,” she said. “They are not packing up their bags just yet, but people are looking to diversify abroad or into other business sectors within Afghanistan.”

Some of the companies that are more heavily dependent on the military and the aid economy, like construction and logistics businesses, are trying to stay put by reconfiguring toward the few areas where analysts feel Afghanistan might have growth potential, like mining or trade.

But others are nervous that Afghanistan’s nebulous private sector will not be enough to fill the gap left by the United States’ military and development spending. World Bank figures back up those fears: the bank estimates that outside aid is equivalent to more than 90 percent of the country’s total economic activity, and forecasts a slowdown in growth in the coming years to 5 or 6 percent from about 9 percent, or much lower if security worsens.

That is in part because, despite the billions in reconstruction and aid money poured into Afghanistan, there still is no major manufacturing or technology base that could be a driver of future prosperity. A new Pepsi bottling plant on the outskirts of Kabul is trumpeted as one of the few new investment triumphs.

“There is a sense that they have to change from a war economy to a postwar economy, and people definitely expect it to contract,” said Thomas Rosenstock, a lawyer, originally from New York, who helps foreign companies entering the Afghan market. “It’s uncertain how dramatic the contraction would be.”

Then there are those who are voting with their cash.

Each week tens of millions of dollars — some thought to be diverted American aid or drug money — are packed into suitcases or boxes and loaded onto planes leaving Kabul International Airport for destinations like Dubai, capital flight that is increasing steadily ahead of the 2014 deadline, officials say.

Noorullah Delawari, the central bank governor, recently imposed restrictions limiting the amount a passenger can take out of the country to $20,000 a trip.

But the mountain of departing cash that is officially declared — about $4.6 billion last year, the same size as the Afghan government’s annual budget — may be matched by money fleeing through other airports and over borders, or seeping out through the black market, an Afghan official said, speaking on the condition of anonymity. “We really don’t know how much is being moved,” the official said.

Security officials are still struggling to ensure that people passing through the V.I.P. area of the Kabul airport put their bags through X-ray machines installed a few years ago in part to keep people from sneaking cash out, the official said.

For Mr. Manani, the butcher, and others like him who do not have huge amounts of capital as a safety blanket, the hopes that they can stay at home and still expand their businesses are being tempered by the need to ensure their families’ safety.

His plan is rooted in an effort to start a second business in New Delhi with his local Sikh business partner there, he says. That would enable him to get a long-term visa, and so a way out for his wife and five children, as well as his parents, brothers and a sister and their children, all of whom depend on him and would have to move with him, he says.

“Every businessman is just thinking about how to move from here, about how to be safe,” Mr. Manani said as he stood in front of a big cooler where sides of beef and lamb were hanging. Through the doorway into another room, four workers were busily cutting and packing.

He grew up in the north of Afghanistan and fought in the bitter civil war of the 1990s. There is no way he wants to relive that experience, he said.

“I don’t have the energy to take the gun again and start fighting,” he said. “That’s why I am looking for a way out.”

Habib Zohori contributed reporting.
http://www.nytimes.com/2012/03/31/world/asia/businesses-may-flee-afghanistan-after-troop-withdrawal.html?_r=1&hp=&pagewanted=print

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