Afghanistan Has $1T in Untapped Mineral Resources?

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I'll get to the main point in a little bit, but bear with me for a second ... A series of recent news stories has deeply damaged the Obama administration's case for continued patience with U.S.-led counterinsurgency campaign, which has shown little discernable progress despite the best efforts tens of thousands of additional American troops and an all-star lineup of top military officers.

First, let's talk about Hamid Karzai, the Afghan president. Remember the chatter earlier this year about how he'd gone crazy, threatening to join the Taliban and all that? That discussion died down a little after Karzai checked all the right boxes during his May visit to Washington.

Then came the "peace jirga" -- after which Karzai abruptly fired his intelligence and interior ministers, reputed to be two of the most competent members of his cabinet (technically, they resigned). The intelligence minister, Amrullah Saleh, told his side of the story Friday in a jaw-dropping interview with the Times. According to Saleh, Karzai no longer believes the West can win the war and is looking to cast his lot with Pakistan and the Taliban; an unnamed source told the paper that Karzai had suggested that the Americans had carried out a rocket attack on the peace jirga. Karzai has apparently also asked the United Nations to remove Mullah Omar from a key U.N. blacklist.

Next came revelations that Pakistan's powerful military intelligence agency, the ISI, is still deeply involved with the Afghan Taliban (yeah, blow me over with a feather) despite heated denials to the contrary.

Meanwhile, the drive for Kandahar looks to be stalled in the face of questionable local support for Karzai's government, the Taliban is killing local authorities left and right, and the corruption situation has apparently gotten so bad that the U.S. intelligence community is now keeping tabs on which Afghan officials are stealing what.

In short, things don't look good for the United States ... which makes me suspicious of the timing of this attention-grabbing James Risen story in the Times, which opens with this mind-boggling lede:

The United States has discovered nearly $1 trillion in untapped mineral deposits in Afghanistan, far beyond any previously known reserves and enough to fundamentally alter the Afghan economy and perhaps the Afghan war itself, according to senior American government officials."

Wow! Talk about a game changer. The story goes on to outline Afghanistan's apparently vast underground resources, which include large copper and iron reserves as well as hitherto undiscovered reserves lithium and other rare minerals.

Read a little more carefully, though, and you realize that there's less to this scoop than meets the eye. For one thing, the findings on which the story was based are online and have been since 2007, courtesy of the U.S. Geological Survey. More information is available on the Afghan mining ministry's website, including a report by the British Geological Survey (and there's more here). You can also take a look at the USGS's documentation of the airborne part of the survey here, including the full set of aerial photographs.

Nowhere have I found that $1 trillion figure mentioned, which Risen suggests was generated by a Pentagon task force seeking to help the Afghan government develop its resources (looking at the chart accompanying the article, though, it appears to be a straightforward tabulation of the total reserve figures for each mineral times current the current market price). According to Risen, that task force has begun prepping the mining ministry to start soliciting bids for mineral rights in the fall.

Don't get me wrong. This could be a great thing for Afghanistan, which certainly deserves a lucky break after the hell it's been through over the last three decades.

But I'm (a) skeptical of that $1 trillion figure; (b) skeptical of the timing of this story, given the bad news cycle, and (c) skeptical that Afghanistan can really figure out a way to develop these resources in a useful way. It's also worth noting, as Risen does, that it will take years to get any of this stuff out of the ground, not to mention enormous capital investment.

Moreover, before we get too excited about lithium and rare-earth metals and all that, Afghanistan could probably use some help with a much simpler resource: cement.

According to an article in the journal Industrial Minerals, "Afghanistan has the lowest cement production in the world at 2kg per capita; in neighbouring Pakistan it is 92kg per capita and in the UK it is 200kg per capita." Afghanistan's cement plants were built by a Czech company in the 1950s, and nobody's invested in them since the 1970s. Most of Afghanistan's cement is imported today, mainly from Pakistan and Iran. Apparently the mining ministry has been working to set up four new plants, but they are only expected to meet about half the country's cement needs.

Why do I mention this? One of the smartest uses of development resources is also one of the simplest: building concrete floors. Last year, a team of Berkeley researchers found that "replacing dirt floors with cement appears to be at least as effective for health as nutritional supplements and as helpful for brain development as early childhood development programs." And guess what concrete's made of? Hint: it's not lithium.

UPDATE: Missed this Wall Street Journal story earlier. Money quote:

[T]he Mines Ministry has long been considered among Afghanistan's most corrupt government departments, and Western officials have repeatedly expressed reservations about the Afghan government awarding concessions for the country's major mineral deposits, fearful that corrupt officials would hand contracts to bidders who pay the biggest bribes -- not who are best suited to actually do the work.

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SARK

8:54 AM ET

June 14, 2010

See: DRC, Sierra Leone

I have a feeling that a lot of people are going to get very excited about this. Multinationals are going to be excited at the opportunity to strip Afghanistan bare, and humanitarians on the assumption that the profits will go towards developing Afghanistan and improving the lot of its people. Obviously, this rosy outcome doesn't always occur, particularly in LDCs that are wracked by internal conflict. Fabulous mineral deposits can be as much a bane for a LDC as a boon. Ask the DRC or Sierra Leone-two countries with vast mineral wealth and also two of the poorest in the world. If I had to bet, it would be on Afghanistan following that route.

TFSPA

11:35 AM ET

June 14, 2010

You don't see a lot of

You don't see a lot of activity in Iraq for all it's oil reserves.

JPWREL

11:19 AM ET

June 14, 2010

A great reason for us to stay

A great reason for us to stay in Afghanistan forever! I am sure British, American and other NATO soldiers won't mind being maimed or killed for lithium ore, after all that is the key must have ingredient in the batteries that run our electronic devices.

ROB44

12:03 PM ET

June 14, 2010

Can we do something that makes sense, for once, just once?

Ok, the Chinese have already moved in and taken a copper mine, thanks to Karzai's back door dealing. The guy is obviously using us, and we are getting NOTHING out of this Afghanistan debacle. We either 1) Take over Afghanistan and its mineral wealth or 2) GET OUT ENTIRELY (and let Karzai be assasinated by his "friends" the Taliban.) Honestly, has there ever been a bigger farce in American history than these Iran/Afghanistan "wars"?

ARVAY

12:24 PM ET

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