Karzai Tries to Lure Chevron, Dole to Afghanistan Amid Fighting

By Mark Drajem

Sept. 26 (Bloomberg) -- Afghan President Hamid Karzai, who is weathering criticism amid renewed attacks by the Taliban, sought to persuade U.S. companies such as Chevron Corp. and Dole Food Co. to invest in Afghanistan.

Karzai traveled from a meeting at the White House with President George W. Bush to an investment forum, where he downplayed the violence in his country and said that companies would be richly compensated for taking the risk of going there.

``The sooner you come, the better will be your reward,'' Karzai told business groups at George Washington University today. ``Are security threats a factor? No. You won't even know about them until you turn on CNN.''

Karzai, president of one of the world's most impoverished countries, said he is trying to rebuild an economy that was destroyed by decades of war, isolation and mismanagement by the previous Taliban regime.

The U.S. military and anti-Taliban tribal forces ousted the fundamentalist Islamic regime from power in Afghanistan in late 2001, after the Sept. 11 attacks. The Taliban sheltered and supported bin Laden, who escaped the fighting and fled to the rugged border area.

Karzai's progress since taking power in 2002 has been uneven. The Afghan economy has averaged economic growth of more than 10 percent a year since he took power, and his government has overseen the building of hundreds of miles of roads and the mapping of the countries oil, gas and other mineral reserves.

Safe Water

Still, only 13 percent of Afghans have access to safe water, and an estimated 7 million people remain vulnerable to hunger, according to the World Bank. Life expectancy is 44 years, and Afghanistan ranks 162 out of 175 on the list of the best countries to do business, according to the bank.

Pakistan President Pervez Musharraf said yesterday in New York that Afghanistan should stop blaming Pakistan for failing to control the Taliban insurgency. Musharraf and Karzai have traded blame over the Taliban insurgency wracking Afghanistan, saying the other must do more to tackle rebels in the mountainous border region between their two countries.

Karzai, Musharraf and Bush plan to meet for a dinner meeting tomorrow at the White House.

Karzai said that among the aid he requested from Bush today was more help in building up the country's electricity capacity. He cited a March report by the U.S. Geological Survey that indicated that Afghanistan could have one of the top 30 reserves in the world of natural gas and oil. Those reserves and Afghanistan's place at the cross-roads of Asia, make it an ideal spot for companies, he said.

Oil and Gas

Companies such as Total SA, Chevron and Royal Dutch Shell PLC should build on the U.S. research and explore for oil and gas. ``The rules are simple: Just come and look for oil, and then we'll see what we can do with you,'' Karzai said.

In addition, Coca-Cola Co. has opened a plant in Afghanistan, and is already making money, in part, because the country has raised tariffs on soft-drink imports, he said. Dole should begin selling Afghan apricots, figs, grapes and melons, he said.

Karzai's government plans to expand on this message next month, when it takes part in a U.S.-government sponsored conference aimed at companies involved in everything from mining to textiles to banking. Already this year, amid reports of escalating violence, foreign investment is double what it was last year.

``There are real opportunities for investment in Afghanistan,'' said Omar Zakhilwal, who leads the Afghanistan Investment Support Agency. ``The security analysis of serious business people is much more positive than the analysis by the media.''

To contact the reporter on this story: Mark Drajem in Washington at mdrajem@bloomberg.net

Last Updated: September 26, 2006 19:11 EDT

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