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Views from the Center


Back in June 2010 a burst of media reported that US geological surveys in Afghanistan revealed vast mineral and oil deposits in the poor war-torn country.  This of course only confirmed the suspicions of some who just knew that U.S. military action in Afghanistan was really an imperialist asset grab. Ah ha!

But now we have pretty good evidence that the Pentagon had no such designs on Afghan riches.  The Defense Department’s Task Force on Business and Stability Operations, which is helping the country design its tender and selection process for mining and oil contracts, set up a system that seems—if complaints like this one in Foreign Policy are anything to go by—to be maximizing benefits for Afghanistan rather than Western companies.  Imagine that!

As evidence, let’s look at the article’s three essential objections:

  • The tender process is so fair and transparent that it fails to privilege Western companies. To quote directly: “the task force stated that it was neutral as to the outcome of the tender; so long as the process was transparent, they did not care whether the winning company was American or Chinese. This is shocking….”  No, it’s not shocking, it’s exactly what the US should be doing.
  • The system maximizes revenue for the Afghan government rather than blocking China. Again, to quote: “the task force argued that its main goal was to ensure that the tender generated quick revenue for the Afghan government, and [China National Petroleum Corporation] offered more generous commercial terms than Western bidders. There is no doubt that the United States has a strategic interest in generating revenue for Afghanistan so that the country can become less dependent on the largesse of Western donor countries, but it also has strategic interests in promoting U.S. companies and in preventing China from capturing valuable resources.”  Really?  Do the authors truly believe the U.S. should encourage the Afghans to accept lower bids so American companies can receive discounted contracts?  It’s even sillier to think that China buying oil or copper licenses in Afghanistan will somehow threaten American access to such commodities.  Is there any market in the world more liquid than the global oil trade?
  • China is paying the Afghans too much. Every dollar that the Afghan government earns from its own resources could save U.S. taxpayers and enable a quicker exit. Yet the article again complains, inexplicably, that “it is common knowledge that CNPC typically bids $5 to $7 per barrel more than other interested bidders in oil tenders.”  Oh the horror!

The U.S. Military seems to have not allowed short-term mercantilism or crude Sinophobia to trump sound advice for the Afghan government as it struggles to manage its mineral resources, one of the trickiest challenges for fragile states.  In so doing, the Pentagon has not only served to dismiss conspiracy theories about American intentions, but also probably helped to put the Afghan government on a more sound financial footing for the future.   Or put another way:  They did the right thing.


CGD blog posts reflect the views of the authors, drawing on prior research and experience in their areas of expertise. CGD is a nonpartisan, independent organization and does not take institutional positions.