Small \u0026 Medium Enterprises Export Promotion Potential, Access to Finance and Formalization in Afghanistan

$Page 1: Small \u0026 Medium Enterprises Export Promotion Potential, Access to Finance and Formalization in Afghanistan$
MINISTRY OF COMMERCE & INDUSTRIES, ISLAMIC REPUBLIC OF AFGHANISTAN

Research Report Small & Medium Enterprises, Access to Finance, Export Promotion Potential and Formalization

Mohammad Sabir Siddiqui

11/1/2014

Faced with the challenges brought about by globalization and a rising demand for a post-conflict reform

in particular by the poorer, relatively disadvantaged and vulnerable Afghans, the government of

Afghanistan as a least-income country is endeavoring to improve its economic performance. Doing so,

one key focus is placed on global trade expansion. The government has made policies and enacted

regulations in the area of trade, in addition to its membership in numerous regional trade integration

agreements. To boost job-creating trade-driven growth, private sector development, as in the rest of the

developing world, is given a major role in Afghanistan. To develop and strengthen the private sector,

among other things, effective policies directed at Small and Medium Sized Enterprises (SMEs) need to be

formulated and implemented.

Ministry of Commerce & Industries, GoIRA, Strategy, Policy & Planning Directorate. COMCEC Project.

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Acronym

WB World Bank

MFIs Microfinance Institutions

SME Small & Medium Enterprises

AISA Afghanistan’s Investment Support Agency

MoCI Ministry of Commerce & Industries

WTO World Trade Organization

EU European Union

AREU Afghanistan Research & Evaluation Unit

ASMED Afghanistan Small & Medium Enterprises Development

SMEDP Small & Medium Enterprises Development Program

AEPA Afghanistan Export Promotion Agency

SMED Small & Medium Enterprise Directorate

CBs Commercial Banks

DAB Da Afghanistan Bank

AFN Afghani

USD United States Dollars

ACGF Afghanistan Credit Guarantee Foundation

BMZ German Federal Ministry for Economic Cooperation

BPHS Basic Package of health care Services

CDC Community Development Council

CSOs Civil Society Organizations

CSPI Community-based Savings Promotion Institutions

DDA District Development Assembly

CSO-AFG Central Statistical Organization

DIME World Bank Development Impact Evaluation Unit

Small & Medium Enterprises, Access to Finance, Export Promotion Potential and Formalization in Afghanistan

Author: Sabir Siddiqui-Email:[email protected]

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Table of Content:

Content Page

Introduction………………………………………………………………………………….6

Definition…………………………………………………………………………………....8

Research Approach………………………………………………………………………….8

Research Questions………………………………………………………………………….9

Afghanistan Economy before 2001…………………………………………………………10

Afghanistan Economy since 2001…………………………………………………………. 11

Access to Finance…………………………………………………………………….….......16

Loan Portfolio………………………………………………………………………………..17

Source of Finance…………………………………………………………………….………17

Gross Loan Portfolio of MFIs……………………………………………………….…….....19

Growth of Loans………………………………………………………………….……….....20

International Financial Corporation………………………………………………….…….. 20

Afghanistan Microfinance Initiative……………………………………………….………. 21

Afghanistan Rural Microcredit Program…………………………………………………....22

BRAC-Afghanistan………………………………………………………………….……....24

Child Fund Afghanistan……………………………………………………………………..25

OXUS………………………………………………………………………………………...27

MADRAC……………………………………………………………………………………29

Ariana Financial Services………………………………………………………………….. 31

Recommendations for better access to Finance……………………………………………..33

Export Promotion Potential…………………………………………………………….…....35

Afghanistan Trade Deficit……………………………………………………………..…….35

Importance of Exports.....................................................................................................…....36

Exports of Afghanistan Product-Wise.............................................................................…....38

Exports Overview…………………………………………………………………………....40

Afghanistan-Pakistan Trade…………………………………………………………………42


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Exports from Afghanistan to Iran……………………………………………………………43

Central Asian Republics Trade Scenario…………………………………………………….44

Exports of Afghanistan by Country…………………………………………………………45

Afghan-Turkey Trade………………………………………………………………………. 46

International Trade with Republic of Tajikistan……………………………………………..47

Challenges to Export to COMCEC member countries………………………………………48

Policy Recommendation……………………………………………………………………..48

Afghan and Regional Integration……………………………………………………….……50

Formalization…………………………………………………………………………………52

Recommendations……………………………………………………………………….……53

Annex 1………………………………………………………………………………………..55

Annex 2……………………………………………………………………………………….59

Annex 3……………………………………………………………………………………….67

Annex 4……………………………………………………………………………………….71

Annex 5……………………………………………………………………………………….78

Annex 6……………………………………………………………………………………….79

Reference List…………………………………………………………………………………87



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Page 6 of 87

1-Introduction Faced with the challenges brought about by globalization and a rising demand for a post-conflict

Government of Afghanistan as a least-income country is endeavoring to improve its economic

performance.

Doing so, one key focus is placed on global trade. The government has made policies and enacted

regulations in the area of trade, in addition to its membership in numerous regional trade integration

agreements.

International trade openness can be of less value unless it results in tangible outcomes in terms of

jobs, growth rate of GDP and a higher standard of living for all Afghans. Due to limited data it is

not known how many jobs depend on imports and exports. Notwithstanding this shortcoming, from

retail to wholesale, trade does play a major role in creating jobs across Afghanistan. But the

contribution of trade to growth is weak considering the health of the Afghan economy, reflected in

its rate of annual gross domestic product.

To boost trade-driven economic growth, private sector development, as in the rest of the developing

world, is given a major role in Afghanistan. To develop and strengthen the private sector, among

other things, effective policies directed at Small and Medium Sized Enterprises (SMEs) need to be

formulated and implemented.

By socioeconomic level of development, Afghanistan was one of the poorest countries in the region

in 2001. Afghanistan’s annual growth rate was less than 1% in 2000. With the change in political

regime and a foreign aid supported new Afghan administration, the growth rate started a sudden

upward trend. Although, the rate of growth of gross domestic product started to register positive

improvements, the economic activity (led by agricultural production) had a highly fluctuation

nature with ups and downs associated with the prevailing security and the resulting slump in

investor and consumer confidence.

Growing at a peak rate of 21% in 2009, GDP declined to 8.4%, 6.1% in 2010 and 2011

respectively. In 2012 GDP started to improve registering 14.4 % increase while in 2013 it reached

to 4.6 % (World Bank).

In Afghanistan’s economic development, SMEs have played a vital role from the very beginning,

even before the US invasion and collapse of Taliban. SMEs make up the backbone of the Afghan

economy in terms of its employment generation potential, poverty alleviation and contribution to

national economic performance.

With the coming into being of the new Afghan administration, turned to free-market economy

(Capitalism) in 2001, private sector approximately, 80-85 % of which was SMEs. Small and

Medium Enterprises were announced engine of economic growth. Afghan government’s focus on

development of SMEs was distracted due to flow of huge amount of foreign aid. This made the

government to an extent failed to focus on sectorial SME competitiveness, access to finance &

market, export promotion potential and formalization which would have guaranteed sustainable

economic growth in the long run.



Page 7 of 87

International community and donor agencies gave small and medium enterprise development prior

attention due to its capability of employment generation opportunities, income level growth and

investment. Many financial institutions were established to support small and medium enterprise

access to finance, market creation, competitiveness and new investments.

Throughout the years, Ministry of Commerce & Industries, government of Islamic republic of

Afghanistan, has been working tirelessly to build national level SME strategy and was finalized in

2009. According to the mentioned strategy, the SME’s of Afghanistan were classified into 6 sectors

and from them only Agribusiness and Cashmere were approved by the Economic Committee of

Cabinet (ECC). Working groups on Agri-business, Leather, Cashmere, Carpet, Marble, precious

and semi-precious stones and construction sectors have been initiated. Afghan government

recognizes the importance of trade development and trade diversification on overall economic-

related activities.

In recent years Afghanistan has highly recommended for inter-regional and international trade

between south, east, west and central Asian countries and from there to Europe. Access to finance

of SMEs is considered important to their growth and in investment in exports. Transit agreement

between Afghanistan-Pakistan (APTA) was signed in recent years.

This study is based on the existing literature and face to face interviews with sectorial officials; the

report hopes to bring to the light the current situation of SMEs in Afghanistan, their access to

finance, export promotion potential and formalization, the state of Afghanistan’s trade with OIC

member countries. The research also looks at the trade relation Exports to regional as well as

COMCEC member countries, the challenges and recommends policy measures to overcome such

bottlenecks.

Small and medium enterprises not like large enterprises are the largest employment generators in

Afghanistan. SME provide almost 80% of employment to Afghanistan’s labor force.

SME development is a very strong factor to accelerate economic activity and enhance internal as

well external trade. SME growth can help poverty alleviation and also promotes democracy through

investor’s participation in overall economic, political and social dimensions of the country.

Afghan Economy recorded fast and brilliant growth in terms of real gross domestic product (GDP)

since the fall of Taliban government (Real GDP growth is now projected at 8 % in 2004/05,

compared with 16 % in 2003/04, and 29 % in 2002/03). This growth rate started to slow down due

to unexpected political reasons. International community recognizes the sustainability of private

sector as important as business conduct itself. Thus SME sector development support is considered

a key factor in any private sector development-growth strategy.


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1.2. Definition

Most definitions of Small and Medium Enterprises (SME) include ranges of assets or turnover per

year, and number of employees. There are inherent disadvantages to this approach. What constitutes

a small to medium size enterprise is subjective and will vary across

economies. What is considered a small business in India might be considered a major player

in Afghanistan. By the standards applied to SMEs by the European Commission, measured in terms

of Euro value of assets or turnover, only two or three private companies in

Afghanistan would not be considered SMEs.

“Micro-enterprises up to 10 employees and total assets or total annual revenues of up to US

$100,000; small enterprises up to 50 employees and total assets or total revenues of up to

US $3 million and medium enterprises up to 300 employees and total assets or total annual

Revenues of up to US $15 million”

The above definition of Small and Medium Enterprises, from the IFC’s Small and Medium

Business Development Department, incorporates a

notion of scale more appropriate to

developing economies. This project uses the IFC definition

as a basic parameter, and should be considered a

guideline and not an absolute measure.

Despite 10years of a market economy, corruption

notwithstanding, the perceived role

of government remains grounded in the beliefs of

three decades ago. If a clear strategy

for SMEs had been put into action earlier, value chains

would have been tested by now

and the role of the government in facilitating

business would have become clear to

business owners. What has happened instead is growth

based other construction boom

and the service sector tied to the foreign presence. The

competiveness and ingenuity of

SMEs to survive after transition era in question.

1.3. Research Approach

This report extensively relies on two different sources of information. A thorough study of

currently, existing literature as well as extensive interviews with key experienced sectorial

informants. The literature review done in this report includes reports on Afghan economy, private

sector development reports, and regional trade reports on central Asian countries. Reports of foreign

aid organizations working for SME development in national and international levels provided a

clear vision into the past, present and future challenges of SME development in Afghanistan. Some

WB reports have also been consulted about the state of Afghan economy and its business

environment. Report of various working groups of MoCI and conference results have been

reviewed.

“Micro-enterprises up to 10

employees and total assets

or total annual revenues of

up to US

$100,000; small enterprises

up to 50 employees and

total assets or total revenues

of up to

US $3 million and medium

enterprises up to 300

employees and total assets

or total annual

Revenues of up to US $15

million”



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Primary data have been collected through F2F interviews with key officials of MRRD, MoCI,

EPAA, SME stake-holders in Afghanistan, government and private banks, financial institutions,

traders, export specialists, business associations and business consultants.

1.4. Research Questions

How to promote the growth of small and medium-sized enterprises (SME) and their

potential of exports in Afghanistan? Or what targeted interventions can help Afghan

SMEs achieve growth?

How to access new markets and credit more effectively?

What targeted interventions can motivate informal SMEs to become structured and

Formalized in Afghanistan?

To find convincing answers to the above and more similar questions the research report sought to

shed light on Access to Finance, Export Promotion Potential and Formalization related problems

faced by SMEs in Afghanistan.

Our methodological approach throughout the research was mix of both qualitative and quantitative

techniques.

1.5. Qualitative Techniques:

Under this method focus group discussions have been utilized to gather less common information

specific to special interest groups, as well as to clarify complex issues and to supplement the data

collected through questionnaires. The FGDs had a semi-structured format. In FGDs people, in

general from similar backgrounds or experiences (e.g., SMEs in Manufacturing, Medium-Sized

Enterprises etc…) were brought together to discuss a specific topic of interest.

In each FGD organized following were the themes:

Classification of SMEs according to level of credit constraint

Trade credit versus Informal Sources of Finance

Two FGDs were held that approximately involved 8-10 participants from various sectors. FGD

participants were selected on pre-determined criteria. Semi-structured interviews were conducted to

collect data in the field, from relevant stake holders. Vann diagram technique has been used to

withdraw the overlap problems.


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1.6. Afghan Economy before 2001

Historically, Afghanistan had what could be called a “mixed guided” system. Before 1978, the

economy was dominated by agriculture and small-scale enterprise, while a number of large

economic enterprises were either 100 percent state-owned then covered under 1991 state owned

enterprise (TASSADI) Law, administered by key respective line ministries with shares owned by

the ministry of Finance, or under the so-called (SHIRKAT) company system, whereby the

government controlled 40-45 percent of stock, with the rest in private hands. Government officials

and members of royal family, which were in many cases the same, were major shareholders in the

SHIRKAT, which simultaneously assured them personal profit and the enterprises support from the

government, (Richard F.Nyrope and Donals M. Seekin., Afghanistan: A Country Study 1986).

Critics of the SHIRKAT system say that it allowed the government to control production and obtain

as easy source of extracted income. The trade sector was

primarily, although not exclusively, private.

All of the economic enterprises were subjected to

often-stiffing government control. They also felt as

much tight control as it resulted in uncertainty created

by the inconsistency and lurches in policy of statist

(State Control), private and nationalization, which mostly

retarded private sector development with the state

typically looking for a way to extract resources, (Maxwell J.

Fry, The Afghan Economy 1974).

Major economic ventures such as Spinzar Company,

Afghan Nasaji (Textile), Ariana Afghan Airlines,

Baghlan Sugar Enterprise, and the “Silos” in the primary

cities like Kabul and Mazar-e- Sharif, were largely associated

with the state, even if they were not totally state owned.

At the early years of People’s Democratic Party of

Afghanistan government before 1978, economic policy

further emphasized the role of the state, especially in its

rhetoric, which stressed the plight of rural, exploited

masses of agriculture workers. The government rhetoric and actions were overtly hostile to the

people they referred to disparagingly as “Feudals” and Capitalists, and many businessmen lowered

their profiles, left the country, or in some cases were killed. The (PDPA)’s urban bias and its belief

that the sooner peasants joined the industrial working class, the sooner Afghanistan will develop

may have been reflected in the reduction of the proportion of financial resources allocated to the

agriculture sector. In the 1982 annual plan, as an instance, only 10 percent of was allocated to

agriculture, although at that time agriculture generated almost 2/3 of gross domestic product (Nyrop

and seekin, Afghanistan A Country Study). The belief was also reflected in the greater investment

made in the mining and industrial sectors, which were largely state-owned.

It was also during this period that the net of social service for the urban population greatly

expanded, in part to reinforce the loyalty of the government’s main constituents, but also because

the rural areas were in revolt and therefore were largely inaccessible to the state.

All of the economic

enterprises were subjected

to often-stiffing government

control. They also felt as

much tight control as it

resulted in uncertainty

created by the inconsistency

and lurches in policy of

statist (State Control),

private and nationalization,

which mostly retarded

private sector development

with the state typically

looking for a way to extract

resources, (Maxwell J. Fry,

The Afghan Economy

1974).



Page 11 of 87

Some estimates show that social service made up a quarter of the developmental budget, and were

twice the proportion of the developmental budget of previous decade. Rising prices, declining

availability of goods, and overall deteriorating social and economic conditions as a result of the war

outside the cities motivated the government to further strengthen support to the urban areas through

price control and consumer subsidies, the latter through a network of cooperative shops “Selling

essential goods below market price and the very popular coupon system.

Under this system a version of which began as early as the 1930s, public sector employees and their

families received coupons for a range of commodities, including wheat, cooking oil and other

essential items. According to one source, by the late 1980s coupons or ration books were supporting

3.5 hundred thousands of families, (Martin Kipping, “Two Interventions” 2010), and such non-

monetary benefits were a significant proportion of total remuneration. The system also reinforced

the idea that state had direct role in the providing for the welfare of the population.

1.7. Afghan Economy Since 2001

Afghanistan has seen steady economic growth over the past decade, with real gross domestic

product (GDP) growth averaging 10.5 % between 2005 and 2012 (World Bank 2014). The growth

of the afghan economy was predominantly fueled by an unprecedented inflow of foreign aid and

aid-financed development projects notably in the construction sector.

With the withdrawal of international security forces

and reductions in foreign aid, the growth rate of the Afghan

economy started to experience a downward trend.

The reductions in aid coupled with political uncertainty

further added to the deteriorating economic

situation, creating as a result the risk perception for

investors—national and international, leading to low

rates of investment and a decline in economic activity.

The new Afghan administration, post-2001

faced with the daunting challenges of reconstruction

prioritized a set of reforms with a predominant and vital

role given to the economic reform agenda. It was a

normal and wise decision to put the economic reforms at

the top list of the agenda given the depth of the damage

the economy had undergone and the relevance, reliance and

mutually reinforcing links between a prosperous

economy and state building needs of Afghanistan.

To place the reform agenda on sound institutional footing,

a well-articulated and globally accepted framework

was missing. As such, relinquishing the social in

favor of a market led and controlled economic system; the transformation agenda started implanting

its roots in early 2002.

A key ingredient, as elsewhere in the world, within this newly adopted liberal economic system was

a major role given to the private sector—operating in the form of small to medium sized firms,

defined in terms of assets owned and the number of workers employed.

The new Afghan

administration, post-2001

faced with the daunting

challenges of reconstruction

prioritized a set of reforms

with a predominant and

vital role given to the

economic reform agenda. It

was a normal and wise

decision to put the

economic reforms at the top

list of the agenda given the

depth of the damage the

economy had undergone

and the relevance, reliance

and mutually reinforcing

links between a prosperous

economy and state building

needs of Afghanistan.


Page 12 of 87

Despite experimentation (more than a decade later) with different policy options/choices the SME’s

could not perform as expected. This lower than expected performance resulted in negligible

contribution to employment creation and GDP growth.

The World Bank (WB) predicts scenarios for Afghan economy during the transition period once

the international military forces withdrawal completes the international community and WB is

optimist about their expectation (based on the predictions) of average growth rate of 7 to 8 percent

per annum after foreign forces leave the country.

Under this assumption (about growth rate) the economic growth and business environment will not

be much affected by the withdrawal of coalition forces. WB also assumes that the mineral and mine

extraction will play a crucial role in sustained economic growth of the country but under the

condition that the Afghan military forces are capable of providing security, after withdrawal of

foreign troops.

However, this growth rate will be at average 6 percent if the growth in agri-business and other

businesses are sustained s and foreign aid starts decreasing gradually, this can be the most likely

condition. In a worst case scenario, the economic average growth rate will be less than 1 percent in

case of extreme security deterioration.

Throughout the past decade, slow exports growth was coupled with a soaring demand for imports.

Afghanistan’s total exports values (of goods and services) increased by 10. 31 percent from US$

375.85 in 2012 to US$ 414.51 million in 2013. Exports account for about 20 percent of GDP in

Afghanistan. Afghanistan Export basket is dominated by primary ad agriculture products with

major share held by carpets and rugs, dried fruits and medicinal plants.

Total imports reached US$ 8932.39 million in 2013 up from US$ 6390.31million in 2012. Hence

imports rose by 39.78 percent between 2012 and 2013. Imports of Afghanistan have registered a

continuously rising trend since 2004. The average import value is estimated at US$ 3782.63 million

covering the period from 2003 to 2013 (CSO).

The mining sector, despite its US$ 3 trillion value in copper, gold and iron Ore, requires significant

investment before it generates employment and excessive revenue. These investments have not

been yet made. Extraction without the eligible human resource can lead to outsourcing of

international which can undermine the desired economic impact.

Afghanistan’s GDP has increased 6 times from 2001 to 2012. Afghan economy has witnessed

average GDP growth rate of US$ 10.175 billion annually since the fall of Taliban regime in 2001.



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Graph 1: GDP Growth of Afghanistan 2001-2012: Source, World Bank Reports.

Afghanistan’s GDP has increased 6 times from 2001 to 2012. Afghan economy has witnessed

average GDP growth rate of US$ 10.175 billion annually since the fall of Taliban regime in 2001.

1.8. Small & Medium Enterprises in Afghanistan

Expanding made in and made by Afghanistan exports by targeting regional and global markets is

vital for longer-term development and shared prosperity of the country. But contrary to this

important observation, the Afghan economy still remains a marginal actor in the regional and global

trade and economy.

To benefit and fully seize the opportunities brought by international trade, developing the export

capacity of SMEs forms a key element of the solution equation to the present and future economic

development needs of Afghanistan and a sustained alleviation of poverty both in rural and urban

settings observed across the country.

As discussed in the previous section, in 2001 Afghanistan started to follow free-market economy

giving the private sector a crucial role as the engine of economic growth.

In any under-developed and developing country, small and medium enterprises are considered the

heart of the private sector. This is not different in Afghanistan. Small and medium enterprises form

up about 80 to 85 percent of Afghan businesses making half of the country’s GDP and employing

more than 33.3 percent of the Afghan labor force. Until recently, development of SMEs was not

prioritized and SME sector continues to face significant challenges to development

3.6 4.3 4.9

5.6 6.6

7.5

10.4 10.8

12.6

16.1

19.3 20.4

0

5

10

15

20

25

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012


Page 14 of 87

Challenges faced by SMEs in Afghanistan are of various kinds. Access to market, access to finance,

marketing strategy, lack of electricity since more than 60 percent of SMEs are operating in rural

Afghanistan, multiple registration authorities, competition with foreign products etc.

Afghanistan did not have a clear SME strategy till 2009. The strategy was implemented in 2011.

This followed the establishment of SME directorate in ministry of commerce and industries,

government of Islamic Republic of Afghanistan. SME directorate begun work with staff of 12,

which doubled in years later. Due to some reasons the directorate remains under-staffed. According

to officials working on SME comments that an extensive public awareness campaign regarding the

new economic system (free- market) was never launched

and not enough attention was given to value-chain

development and coordination of economic policy at higher

levels. SME development in Afghanistan happened in ad-

hoc, donor aid basis.

Despite a limited government strategy, major donor projects

have been completed to

Support SMEs. These include USAID’s five and a half year,

US$114 million ASMED program. ASMED supported

value chain development, which helped Afghan

businesses maximize their profit and resulted in job

creation. The programme also provided in-kind grants and

techniques assistance to a range of enterprises include

gem cutting, carpet cut and wash facilities and cardboard

for packing fruit. ASMED supported both existing

business associations and formation of new ones.

ASMED studied specific industries to assess value

gaps. For example, the marble industry needed to enhance

finishing techniques and improving links to

international markets.

This meant direct grant investments in finishing

techniques, combined with work with associations and

the government to identify business opportunities in

foreign markets.

The Dried Fruit Exporters Association of Kandahar

(DFEAK) and the Fresh Fruit Exporters Union of Kandahar

(FFEU) buy from 20,000 farmers in the southern region

of the country, exporting about 90 percent of the fruit

from the south. With ASMED’s support, a box

factory was installed in Kandahar, reducing the cost of

packaging from $2to $1per 20 kilograms.

To assess its success, ASMED used the number of SMEs (1,300) and jobs (100,000) created under

the programme. The challenge is sustainability; a problem which ASMED Acknowledges, saying

that even in the US, as many as 30 percent of new businesses failed

within next two years.

The performance of Afghan SMEs is linked with a broad set of variables. While some of those

variables are internal there are others that depend upon the existing conditions offered by domestic

and international markets. There is a positively direct link between internationalization and SMEs

Afghanistan did not have a

clear SME strategy till

2009. The strategy was

implemented in 2011. This

followed the establishment

of SME directorate in

ministry of commerce and

industries, government of

Islamic Republic of

Afghanistan. SME

directorate begun work with

staff of 12, which doubled

in years later. Due to some

reasons the directorate

remains under-staffed.

According to officials

working on SME comments

that an extensive public

awareness campaign

regarding the new

economic system (free-

market) was never launched

and not enough attention

was given to value-chain

development and

coordination of economic

policy at higher levels.

SME development in

Afghanistan happened in

ad-hoc, donor aid basis.



Page 15 of 87

performance, where growth and competitiveness –two key variables determining SMEs success—

depend on the degree of ease and barriers the export market of concern offers to the goods and

services the Afghan firms are ready and willing to offer.


Page 16 of 87

2.1. Access to Finance

Although as discussed earlier, SMEs constitute an important component of the private sector in

Afghanistan, they face constraints to their operation and growth. One major obstacle they face is the

lack of access to finance.

Financial deepening is significantly positively associated with economic growth through the SME

finance channel. Financial development affects firm and GDP growth and a critical missing ingredient is

often access to financial services (loans).

The availability of credit is particularly important to the exporting firms. This is indeed decisive for

SMEs, for which the credit constraints are more binding than for relatively large firms. Since SMEs

make up the large majority of firms in developing countries, improvements in this domain are necessary

for export growth and hence improved economic performance.

Since 2003 the banking sector in Afghanistan, has experienced

an unprecedented growth contributing to the development

of the private business activity across the country. This has

also helped small and medium enterprises foster their growth

and stability.

In 2003, Afghanistan’s central bank (Da Afghanistan Bank or

DAB) resumed regulatory functions necessary to ensure

the stability of the country’s banking sector. Since then,

Afghanistan’s banking sector has grown from two state-

owned commercial banks and four state-owned special

purpose development banks to nine privately-owned

commercial banks, three state- owned commercial banks, and

four foreign commercial banks, with more than 400 total

branches across Afghanistan (WB April 2013).

There are a total of 16 commercial banks in

Afghanistan, including three state-owned, nine private

banks, and four foreign. These banks offer both conventional

and Islamic banking products. Fund-based financing methods

include term loans, overdraft, SME, financing and Islamic

financial products such as Murabahah, Mudarabah, Musharakah and Ijarah. Non-fund based

financing is in the form letter of credit and bank guarantee.

The above banks are all the principal sources offering financial access for businesses in Afghanistan. As

already classified above, the sources of finance in Afghanistan are divided into two different categories.

(1) Formal which includes all the commercial banks, micro finance institutions, and other financial

institutions. As far as commercial banks are concerned they generally provide short-to-medium term

loans and credit to both individuals and businesses. They (CB) generally concentrate on corporate

clients. Microfinance institutions (MFIs), on the other hand, concentrate on small & medium enterprises

(SMEs) with somehow similar terms as those of commercial banks.

MFIs, unlike commercial banks, usually require third party guarantee instead of collateral, and their

loans do not exceed AFN 2.5 million or $50,000. There are also other financial institutions in

Afghanistan which provide large-size, long-term loans with more flexible and easier terms and

conditions.

There are a total of 16

commercial banks in

Afghanistan, including three

state-owned, nine private

banks, and four foreign.

These banks offer both

conventional and Islamic

banking products. Fund-

based financing methods

include term loans, overdraft,

SME, financing and Islamic

financial products such

as Murabahah,

Mudarabah, Musharakah

and Ijarah. Non-fund based

financing is in the form letter

of credit and bank guarantee.



Page 17 of 87

The commercial banks that currently provide loans and credit to small and medium enterprises are listed

below:

Afghanistan International Bank (AIB)

First Micro Finance Bank

Bakhtar Bank

BRAC AFGHANISTAN BANK (BAB)

Ghazanfar Bank

The micro-financial institutions which are providing loans and credit are listed below:

International Finance Corporation (IFC)

Afghanistan Growth Finance (AGF)

Afghanistan Finance Company (AFC)

Ariana Financial Services

BRAC

FINCA

FMFB

Hope for Life

MADRAC

Mutahid

OXUS

Parwaz

Sunduq

Afghanistan Micro Finance Initiative

Apart from above mentioned financial institutions providing loans and credit to micro as well as small

and medium enterprises, there are dozens of donor institutions active in this market.

2.2. Loan Portfolio

Loans and advance portfolio of the system stood at AFN 41.45 billion (USD 837 million), in 2012, (data

for current year is not available), down by 48.60 percent since January 2011, and comprises 20.96

percent of total assets, where Gross Loans were AFN 80.65 billion (USD 1.79 billion) or 40.91 percent

of total asset.

Out of these loans portfolio, total dominated loans at stood at USD 194 million, 23.17 percent of total

Gross Loans or 4.86 of total assets, down by 57.04 percent since the previous period, January 2011.

USD dominated loans are USD 643 million, 76.81 percent of total gross loans or 16.10 total assets down

by 45.36 percent since the previous period January 2011. The above mentioned decrease has come from

a number of financial institutions, but mainly from the political and economic crises due to presidential

election. Lending in Afghanistan is dominated by private banks and financial institutions (formal) which

are 74.46 percent of total gross loans of the banking system followed by state-owned banks with 15.43

percent. In contrast the share of foreign bank branches is just 10.11 percent.

2.3. Sources of finance in Afghanistan by SMEs

Formal sources of financing in Afghanistan, generally includes commercial banks, microfinance

institutions, and other financial institutions.


Page 18 of 87

Commercial banks in Afghanistan offer short- to medium-term loans to both individuals and

businesses, but focus primarily on corporate clients. Microfinance institutions (MFIs), on the other

hand, concentrate on small & medium enterprises (SMEs) with more or less similar terms as those

of commercial banks.



Afghanistan which provide large-size, long-term loans

with more flexible and easier terms and conditions.

Almost all banks in Afghanistan offer term loans.

Microfinance institutions (MFIs) in Afghanistan provide credit to microenterprises and

SMEs. Unlike in other countries, MFIs in Afghanistan provide loans only for income-generating

activities and do not lend for consumption purposes. Some microfinance institutions require their

clients to have at least 6 months of experience in their business.

The size of a loan in microfinance does not exceed Af.2.5 million or $50,000. There are a total of

nine MFIs in Afghanistan which operate in most provinces. Microfinance Investment Support

Facility for Afghanistan (MISFA) provides funds to seven of these MFIs. FINCA Microfinance

Afghanistan and WOCCU Afghanistan provide credit based on the Islamic modes of finance, and

The First Microfinance Bank also accepts deposits.

There are a total of 16 commercial banks in Afghanistan, including three state-owned, nine private

banks, and four foreign bank branches. These banks offer both conventional and Islamic banking

products. Fund-based financing methods include term loans, overdraft, SME. Financing and Islamic

financial products such as Murabahah, Mudarabah, Musharakah and Ijarah. Non-fund based

financing is in the form letter of credit and bank guarantee. The above banks are all the sources of access to finance by businesses in Afghanistan. As have already

been classified, the sources of finance in Afghanistan to two different categories i.e. Formal which

includes all the commercial banks, micro finance institutions, and other financial institutions. As far as

commercial banks are concerned they generally provide short-to-medium term loans and credit to both

Government Banks

1 Bank-e-Millie Afghan

2 New Kabul Bank

3 Pashtany Bank

Private Banks

1 Afghanistan Commercial Bank

2 Afghanistan International Bank

3 Afghan United Bank

4 Arian Bank

5 Azizi Bank

6 Bakhtar Bank

7 Ghazanfar Bank

8 Maiwand Bank

9 The First Micro Finance Bank

Foreign Commercial Banks

1 Bank Alfalah Ltd

2 Habib Limited Bank

3 National Bank of Pakistan

4 Punjab National Bank

Key Problems of SMEs Access to

Finance:

Higher rates of Interest

Concentration of

Financial Institutions in

5 major cities

Bureaucratic Procedure

Corruption in formal as

well as informal financial

institutions

Almost all credits are

granted for the short-

term

Not all the financial

institutions provide SME

loan



Page 19 of 87

individuals and businesses. They (CB) generally concentrate on corporate clients. Microfinance

institutions (MFIs), on the other hand, concentrate on small & medium enterprises (SMEs) with

somehow similar terms as those of commercial banks.



Afghanistan which provide large-size, long-term loans with more flexible and easier terms and

conditions.

The commercial banks currently provide loans and credit to small and medium enterprises are list below

Afghanistan International Bank (AIB)

First Micro Finance Bank

Bakhtar Bank

BRAC AFGHANISTAN BANK (BAB)

Ghazanfar Bank

The micro-financial institutions which are providing loans and credit are listed below:

International Finance Corporation (IFC)

Afghanistan Growth Finance (AGF)

Afghanistan Finance Company (AFC)

Ariana Financial Services

BRAC

FINCA

FMFB

Hope for Life

MADRAC

Mutahid

OXUS

Parwaz

Sunduq

Afghanistan Micro Finance Initiative

Apart from above mentioned financial institutions providing loans and credit to micro as well as small

and medium enterprises, there are dozens of donor institutions active in this market.

2.4. Gross Loan Portfolio of MFIs in Afghanistan

Loans and advances portfolio of the system stood at AFN 41.45 billion (USD 837 million), in 2012,

(data for current year is not available), down by 48.60 percent since January 2011, and comprises 20.96

percent of total assets, where Gross Loans were AFN 80.65 billion (USD 1.79 billion) or 40.91 percent

of total asset. Out of this loans portfolio, total dominated loans at stood at USD 194 million, 23.17

percent of total Gross Loans or 4.86 of total assets, down by 57.04 percent since the previous period,


Page 20 of 87

January 2011. USD dominated loans are USD 643 million, 76.81 percent of total gross loans or 16.10

total assets down by 45.36 percent since the previous period January 2011. The above mentioned

decrease has come from a number of financial institutions, but mainly from the political and economic

crises due to presidential election. Lending in Afghanistan is dominated by private banks and financial

institutions (Formal) which are 74.46 percent of total gross loans of the banking system followed by

state-owned banks with 15.43 percent. In contrast the share of foreign bank branches is just 10.11

percent.

Graph 2: Sources of Access to Finance in Afghanistan Source: Da Afghanistan Bank

2.5. Growth of Loans

Loans and advances have been experiencing fluctuations since March 2010. Total gross loans registered

a significant percentage of 54.19 decreases. Gross loans have increased by 2.92 percent in 2012 (data

not available for succeeding years).

2.6. International Financial Cooperation

International Financial Cooperation a member of World Bank (WB) is the largest development

institution focused precisely on the private sector development in developing countries.

International Financial Cooperation (IFC) strategy in Afghanistan focuses on improving the

country’s infrastructure, increasing access to finance of SMEs, promoting financial sector and

supporting private sector through investment and advisory services programs.

IFC in 2012, committed a US$ 4 million investment in the country all in financial market sectors.

IFC’s current investment portfolio stands more than US$ 81 million. Apart from financial sector,

IFC sheds lights of investment on health sector, telecom sectors and basic infrastructure

development projects as well.

Investment diversification of International Financial Cooperation (IFC) can be studies as under.

74.46

15.43 10.11

0

10

20

30

40

50

60

70

80

Private Banks & FinancialInstitutions

State-owned Banks Foreign Bank Branches

Lending in Afghanistan



Page 21 of 87

US$ 65 million gross loan portfolio

US$ 10 million equity share to MTN telecommunication company

US$ 4.5 million Afghan Center for Multi-Professional Education and Training Family

Hospital

US$ 1.5 million Trade Finance to Afghanistan International Banks (AIB)

2.7. Afghanistan Micro-Finance Initiative

CHF international’s Afghanistan Microfinance Initiative (AMFI) offers credit and working capital

for households and small businesses and to low-income families in Bamyan and Ghazni provinces.

The program uses solidarity group method to offer credit to the business owners. The goal of the

program is to improve the quality of life of individuals and business conduct in rural Afghanistan in

the long-run and both the above mentioned provinces in the short-run by addressing the need and

demand for broader access to financial services.

The amount of loan and credit disbursed by (AMFI) was USD 1.1 hundred thousand in 2004 with

active number of borrowers 304 households and business owners. Total credit granted by (AMFI)

stood at USD 4.35 million from 2004 to 2010, averaging USD 6.204 hundred thousand.

Graph 3: Gross Loan Portfolio of Afghanistan from 2004-2010, in USD million. Source; Author Illustration

The total number of active borrowers of (AMFI) was 304 households and business entities in 2004.

This figure rose to 4811 households/business entities in 2007, which dropped to 1405

households/business entities in 2010. From 2004 to 2010 the total active borrowers amounted

17384 households/business entities averaging 2984 household/business entities per year.

1,09,200

5,31,623

11,78,618 11,03,260

8,35,517

3,53,712

2,30,242

0

2,00,000

4,00,000

6,00,000

8,00,000

10,00,000

12,00,000

14,00,000

2004 2005 2006 2007 2008 2009 2010

Gross Loan Portfolio of (AMFI) Million USD


Page 22 of 87

Graph 4: Number of Active Borrowers, AMFI Household/SME. Source; Author Illustration

2.8. Afghanistan Rural Microcredit Program (ARMP)

The Agha Khan Foundation is a non-governmental, international development agency established

in 1967 by His highness, the Agha Khan. Its mission is to develop and promote creative solutions to

problems that to impede social development, primarily in Asia and East Africa. The Afghanistan

Rural Microcredit Program (ARMP) was set up in 2003, by the Agha Khan foundation (AKF). Its

primary objective is to serve rural micro credit needs. The organization offers a variety of loan and

credit services to individuals and small business entities to improve their business activities or

remedy cash flow problems.

ARMP reached sustainability in its operation in 2005.

Total loans disbursed by (ARMP) from 2003 to 2009 exceeds USD 64.44 million averaging USD

10.74 million per year. The initial loan portfolio of (ARMP) granted to households/business entities

across the country, was USD 0.078 million in 2003, which rose to USD 20.69 million.

304

1,736

3,362

4,811

3,812

2,058

1,405

0

1000

2000

3000

4000

5000

6000

2004 2005 2066 2007 2008 2009 2010

Number of Active Borrowers of (AMFI) Household/SME



Page 23 of 87

Graph 5: Gross Loan portfolio, ARMP 2003-2008. Source; Author Illustration

At the initial year of operation of (ARMP) the number of borrowers was households/business

entities 722 in 2003, and this number increased to 30719 households/business entities averaging

17378 households/business entities in 2009.

Graph 6: Number of Active borrowers (ARMP) Household/SME. Source Author Illustration

78,833

30,72,903

84,30,793

1,68,89,524

2,06,90,527

1,52,80,822

0

50,00,000

1,00,00,000

1,50,00,000

2,00,00,000

2,50,00,000

2003 2004 2005 2006 2007 2008

Gross Loan Portfolio (ARMP) Million USD

722

4,907

15,670

30,346 30,719

21,905

0

5000

10000

15000

20000

25000

30000

35000

2003 2004 2005 2006 2007 2008

Number of Active Borrowers (ARMP) Household/SME


Page 24 of 87

2.9. Bangladesh Rural Advancement Committee-Afghanistan

Bangladesh Rural Advancement Committee (BRAC), an international development organization

based in Bangladesh, is the largest non-governmental development organization in the world in

terms of number of employees and the number of people is has helped, as of November 2012.

BRAC began its operation in 2002 in Afghanistan though it was established in 1972 soon after the

independence of Bangladesh in Bangladesh. BRAC registered in Afghanistan in 2002 and covers 23

provinces out of 34. Its major programs in Afghanistan include Microfinance, apart from other

humanitarian programs. Microfinance program has over 429 branch offices scattered across the

country that have disbursed more than USD 181.1 million to over 179 thousands of households and

100 thousands of business enterprises. The amount of loans disbursed by BRAC in the initial years

of operation 2002 was USD 44,470 which has increased to USD 43.04 million in 2010.

Graph 7: Gross Loan Portfolio, BRAC-AFG; 2002-2012. Source: Author Illustration

At the starting year of its operation (BRAC-AFG) disbursed loans to 264 households/business

entities, and in the succeeding years this number increased to 154742 households/business entities

in 2010 and again decreased to 116707 households/business entities in 2012.

44,470 7,86,975 35,85,947

74,63,597

2,07,80,335

2,63,41,011 2,69,76,753

3,56,87,797

4,30,37,393

1,64,20,273

0

50,00,000

1,00,00,000

1,50,00,000

2,00,00,000

2,50,00,000

3,00,00,000

3,50,00,000

4,00,00,000

4,50,00,000

5,00,00,000

2002 2003 2004 2005 2006 2007 2008 2009 2010 2012

Gross Loan Portfolio (BRAC-AFG)



Page 25 of 87

Graph 8: Total Number of Active Borrowers, BRAC-AFG, 2002-2012. Source Author Illustration

2.10. Child Fund Afghanistan (CFA)

The child Fund Afghanistan (CFA), micro finance is a spin-off organization from Christian

Children’s Fund (CCF) that began as microfinance institution and its microfinance operations

within the CFA NGO program in Kunduz in November 2002. The initial funding was provided by

UNHCR and its parent organization CCF. With the guidance and inputs as CCF had a long term

experience in promoting microfinance in other parts of the world, helped CFA microfinance to

strengthen its activities. Considering the activity and its growth and future sustainability, a

Memorandum of Understanding (MoU) was signed by both the parties (CFA and CCF) in 2005,

making CFA Microfinance Ltd as a standing operating unit.

As Afghan local law requires every entity to be registered with Afghanistan authorities, CFA was

formally registered as a microfinance company under AISA. Since then it has been operating as an

independent entity a board to oversee it.

Over the years CFA has grown in terms of client coverage and portfolio size. In 2010 the MFI

(CFA) had activities in 12 districts of Kunduz, Takhar, Badakhshan and Baghalan, through its 5

branches. Gross loan portfolio in total terms since 2005-2011 was standing at USD 15.16 million.

The highest amount of gross loan portfolio of CFA stood at USD 3.55 million in 2007. CFA plans

to expand it operational area by targeting new provinces in the future.

264

15,710

55,572

87,153

1,38,625 1,40,032 1,40,191 1,50,638 1,54,742

1,16,707

0

20000

40000

60000

80000

100000

120000

140000

160000

180000

2002 2003 2004 2005 2006 2007 2008 2009 2010 2012

Total Number of Active Borrowers (BRAC-AFG)


Page 26 of 87

Graph 9: Gross Loan Portfolio, CFA 2005-2011. Source, Author Illustration

CFA aims at offering a package of financial services to its clients and therefore offers saving, credit

and in-house insurance services to its clients. While encouraging the members of regular savings, it

also offers three kinds of loan products: family business loans, which accounts 80-85 percent of its

total portfolio, winter loans and individual loans. All the loans are disbursed for the business or

enterprise productive purposes and recovery repayments are made on monthly basis. The loan term

is 12 months and the interest rate charged by CFA varies from 18-26 %.

Graph 10: Total Number of Active Borrowers, Child Fund Afghanistan 2005-2011. Source Author Illustration

9,09,926

17,43,375

35,41,841

31,96,615

21,34,918 20,96,679

15,30,560

0

5,00,000

10,00,000

15,00,000

20,00,000

25,00,000

30,00,000

35,00,000

40,00,000

2005 2006 2007 2008 2009 2010 2011

Gross Loan Portfolio Child Fund Afghanistan (CFA)

7,100

10,430

20,380

18,587

11,662 10,264

6,817

0

5,000

10,000

15,000

20,000

25,000

2005 2006 2007 2008 2009 2010 2011

Total Number of Active Borrowers (CFA)



Page 27 of 87

2.11. OXUS Afghanistan OXUS Afghanistan started its operations in 2005 as a project of Agency for technical Cooperation

and Development, France.

This project aims at providing micro and small loans to groups and individuals for income

generating activities. In the year 2007 it was registered with Afghan Investment Support Agency

(AISA) as a joint stock company.

The OXUS Afghanistan has expanded quickly within a 10 years of operation due to presence of its

prompter organization-ACTED in Afghanistan. As of 2013 annual report it had 8911 clients who

are serviced through 9 branches in 11 districts covering 5 provinces. Its portfolio comprises of half

rural clients and half urban clients. Its current concentration on women client is over 40 percent.

OXUS Afghanistan four types of loan products as below;

Group loans: OXUS Afghanistan offers 6 months group loans and 12 months group loan.

Small personal loan: Individual Loan with small amount dedicated to poor people for

whom it is not convenient to get a group loan for productive purposes.

Individual and SME loan: bigger individual loan for bigger entrepreneurs and SME

companies.

Consumer Loans: For time dedicated to the most committed OXUS and ACTED

employees.

OXUS Afghanistan has a total number of clients who have been served through its various loan

product have had fluctuation throughout the years. It had the highest number of clients in 2007

which was 13,406 individuals/households/business entities with gross loan portfolio USD 2.5

million at the same year and lowest 616 individuals/households/business entities with gross loan

portfolio USD 0.084 million in 2005.

OXUS Afghanistan plans to offer the insurance and saving services in the near future and has

started accepting deposits from 2012. In 2012 total amount of deposits of clients with OXUS

Afghanistan was USD 0.4135 million with 8662 number of clients.

In addition, it plans to offer the value added services to customers such as mobile banking, cash

transfers.

OXUS Afghanistan has plans for resource mobilization, i.e. equity, debt and commercial loans

from different sources in the near future.


Page 28 of 87

Graph 11: Gross Loan Portfolio, OXUS-AFGHANISTAN 2005-2013. Source Author Illustration

OXUS Afghanistan has a total number of clients who have been served through its various loan

product have had fluctuation throughout the years. It had the highest number of clients in 2007

which was 13,406 individuals/households/business entities with gross loan portfolio USD 2.5

million at the same year and lowest 616 individuals/households/business entities with gross loan

portfolio USD 0.084 million in 2005.

Graph 12: Total Number of Active Borrowers, OXUS-AFG 2005-2013. Source, Author Illustration

84,437

8,02,440

25,68,744

39,57,776

28,32,404 34,38,474

61,24,486

89,29,293 88,40,552

0

10,00,000

20,00,000

30,00,000

40,00,000

50,00,000

60,00,000

70,00,000

80,00,000

90,00,000

1,00,00,000

2005 2006 2007 2008 2009 2010 2011 2012 2013

Gross Loan Portfolio OXUS-AFGHANISTAN

616

5,621

13,406 13,169

8,594

4,922

6,631

8,662 8,911

0

2000

4000

6000

8000

10000

12000

14000

16000

2005 2006 2007 2008 2009 2010 2011 2012 2013

Total Number of Active Borrowers (OXUS-AFG)



Page 29 of 87

2.12. MADRAC Microfinance Agency for Development and Rehabilitation of Afghan Communities (MADRAC) is

a spin off (DACAAR), which has been operating in Afghanistan since 1984. As a part of its all

development initiatives, DACAAR started microfinance interventions in 2000. It promotes groups

to encourage regular savings and providing them revolving loan funds.

Later DACAAR created a separate microfinance structure called Microfinance Agency for

Development and Rehabilitation of Afghan Community (DACAAR) to vividly differentiate

between financial services and other community related services, proving a total independent

identity and rendering need based microfinance services to the poor on a sustainable manner.

In June 2005, through an agreement with MISFA, DACAAR is now able to secure fund to build

portfolio, systems & procedures and institutionalize MADRAC into a specialized microfinance

institution and registered as separate entity in June 2007 under Afghan law.

MADRAC is currently working through over 20 branches. Till 2010 the MFI served through its

loan products over 54.58 thousand families/small business entities across the rural Afghanistan with

USD 9.6 million total loans disbursed till 2010.

Earlier, MFI concentrated in the rural areas but since 2009 it has expanded to the urban and semi-

urban areas also. The ratio of rural and urban market for MADRAC is 75:25. The male clients

constitute 57 percent as the remaining 43 percent are female clients.

MADRAC offers both saving and credit services to its members. Hence MADRAC provides three

kinds of credit products for its members as;

Group General Loan: Among all the loan products, the Group General Loan (GGL) is

the core product. It has been widely accepted by the clients in rural Afghanistan.

MURABAHA Loan: To respond to the religious sentiment and needs of the clients,

MADRAC developed another loan product according to Sharia practice namely

Murabaha Loan-loans in terms of goods or assets and not in cash. The product could

generate lot of demands among the rural and semi-urban clients who not prefer cash

loan.

Small Enterprise Loan: To cater to the needs of its clients in urban and semi-urban

especially the potential entrepreneurs who ran small and medium enterprises, the MFI

offers another product called Small Enter Loan (SEL) and Medium Enterprise Loan

(MEL). The product generated good demand.


Page 30 of 87

Graph 13: Gross Loan Portfolio, MADRAC 2005-2010. Source Author Illustration

MADRAC also accepted deposits from clients. The sum of total deposits, MADRAC accepted from

11152 clients was USD 0.034136 million is 2006. This amount as well as number of clients

(depositors) increased to 15452 households/business entities in 2008, with increased amount of

deposits USD 0.238596 million in 2009.

Graph 14: Total Number of Active Borrowers MADRAC 2005-2010. Source Author Illustration

66,207

11,95,027

26,62,430 26,67,526 28,18,208

2,20,120

0

5,00,000

10,00,000

15,00,000

20,00,000

25,00,000

30,00,000

2005 2006 2007 2008 2009 2010

Gross Loan Portfolio (MADRAC)

886

8,249

15,358 15,452

13,853

780

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

18,000

2005 2006 2007 2008 2009 2010

Total Number of Active Borrowers (MADRAC)



Page 31 of 87

As far as total amount of deposits as well as total number of depositors with different amount of

deposits with MADRAC is given and presented by the graph below from 2005 to 2010.

Graph 15: Total Deposits/Depositors, MADRAC 2005-2010. Figures, USD Million/Clients. Source, Author illustration

2.13. Ariana Financial Services

Ariana Financial Services (AFS) began operations as a program of Mercy Crops in May 2003 with

an initial grant from the Bill & Mellinda Gates Foundation. Early operations focused exclusively on

women in district 7 of Kabul province, the area hardest hit by fighting during the war.

The initial success of (AFS) led by Mercy Corps to submit a proposal to the World Bank for the

expansion of operation and funding under the Microfinance Investment Support and Facility for

Afghanistan (MISFA).

The proposal was approved and the first contract was signed between Mercy Corps and MISFA in

October 2003, which was followed by continued relationship, between AFS and MISFA. As

required by the Afghan local law, AFS was formally registered as a microfinance Joint stock

company on May 2007.

Since its inception in May 2003, AFS has disbursed loans for a total sum of over USD 18 million.

Today AFS offers group solidarity and individual loan products to both male and female clients

through various and over 5 branches. AFS till end of 2011 has served over 0.050049 million clients.

0

34,136

1,31,072

1,78,927

2,38,596

0 0 11,152 15,358 15,452 15,378

0 0

50,000

1,00,000

1,50,000

2,00,000

2,50,000

3,00,000

2005 2006 2007 2008 2009 2010

Total Deposits/Depositors (MADRAC) USD million/Clients

Deposits with MADRAC in USDmillion

Number of Depositors


Page 32 of 87

The loan products are group loans, individual loans, agro loans and recently has introduced

Murabaha Loan. Group loan constitute 70 percent. Individual loan 20 percent and agro-loan 10

percent of the MFI loan portfolio. All loans have monthly payment schedule and term varies from 3

months to 36 months. The rate of interest also varies for each product.

So far AFS has been getting financing from MISFA at 5% per annum. Besides MISFA, AFS also

getting some loan support from Kiva. AFS currently has over 700 KIVA clients with a portfolio

over of AFN 12 million.

Graph 16: Gross Loan Portfolio of Ariana Financial Services 2003-2011. Source, Author Illustration

Since its inception in May 2003, AFS has disbursed loans for a total sum of over USD 18 million.

Today AFS offers group solidarity and individual loan products to both male and female clients

through various and over 5 branches. AFS till end of 2011 has served over 0.050049 million clients.

Graph 17: Total number of active borrowers of Ariana Financial Services 2003-2011. Source Author Illustration

3,08,897 2,43,110 5,35,601

9,25,905

25,14,016

35,28,543

31,26,599 32,00,114 33,62,738

0

5,00,000

10,00,000

15,00,000

20,00,000

25,00,000

30,00,000

35,00,000

40,00,000

2003 2004 2005 2006 2007 2008 2009 2010 2011

Gross Loan Portfolio (AFS) Million USD

2,873 1,911

4,328

6,217

10,312 10,664

7,741

6,003 6,003

0

2,000

4,000

6,000

8,000

10,000

12,000

2003 2004 2005 2006 2007 2008 2009 2010 2011

Total Number of Active Borrowers (AFS)



Page 33 of 87

2.14. Recommendations for Access to Finance

To support the growth of Afghan SME’s and generate SME-driven but decent employment

opportunities to hundreds and thousands of unemployed Afghans, the Ministry of Commerce and

Industries must adopt serious measures as part of a targeted trade and development strategy. One major

aspect of the measures should circle around the financial incentive system. Affordable and timely access

to trade and in particular export finance is vital to the success of the above intervention(s).

As discussed earlier, Afghanistan is a predominantly agricultural economy where the majority

of households rely on farming and related activities as their source of income. Supporting such

households and the broader agricultural economy to feed the country and gradually switch from

subsistence to commercial farming requires access to finance. Affordable finance and credit in

turns allows them to procure assets and inputs at lowest prices.

When it comes to exports from Afghanistan price matters a lot. This is because the relatively

higher commodity prices driven by high prices of imports and the observed infrastructure

deficit makes it almost unlikely for Afghan goods to enter and compete foreign markets. It is

only through the availability of finance that the private sector can invest in producing inputs

domestically and avoid unnecessary costs that finally prove as constraints to national exports.

In addition to national sources of finance, regional and global commercial banks need to step in,

lend to the urban and importantly rural business. This foreign dimension of access to finance is

closely attached to the security situation and confidence in the overall business environment in

Afghanistan.

Key Recommendations:

Ease of access to

finance by SMEs

through increase in

numbers of financial

institutions & their

branches in rural

Afghanistan

Lower cost of access

to finance

Lower rates of interest

for SME credit,

through incentives to

financial institutions

by donor agencies

through government

channels

Establishment of an


Page 34 of 87



Page 35 of 87

3.1. Export Promotion Potential

Exports of a country play an important role in the overall growth of the economy. A healthy trade

balance, a sustainable development with trade and foreign exchange reserves to maintain the

country's export growth should be a constant and high rate. Exports as a whole affect the economic

and industrial environment. To compete internationally, the industry standard for quality products,

competitive price, good packaging etc. is utmost essential and this is important for overall industrial

growth. For export as a national priority for government and private sectors recognized by all

agencies to export, export growth is to maintain high rates. Partnership between public and private

sectors, export procedure, the better foreign direct investment (FDI), especially in the

manufacturing sectors, the results at all levels should maintain and strengthen further. Exports as a

motivating force can put Afghan economy to act fast develop Afghan economy and Afghanistan as

an important exporter in the region.

Afghanistan’s GDP growth rate in exports is an important but not strong factor contributing to

GDP increase constantly. Afghanistan's economy has performed well in recent years after the

country adopted the new economic model post-Taliban.

3.2. Afghanistan’s Trade Balance

Afghanistan recorded a trade deficit of 8209 USD Million in 2014. The country’s balance of trade

in averaged -3823.98 USD Million between 2003 until 2014, reaching an all-time high of -1660.92

USD Million in 2005 and a record low of -8518 USD Million in 2013. Trade balance is reported by

the Central Statistics Organization of Afghanistan.

-1958.95 -1660.92

-2102.77 -2327.76 -2567.83 -2475.43 -2933

-4766

-6139

-8654 -8209

-10000

-9000

-8000

-7000

-6000

-5000

-4000

-3000

-2000

-1000

0

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Trade Deficit

http://www.eximtutor.com/start-to-export-htm/

http://www.eximtutor.com/start-to-export-htm/


Page 36 of 87

Graph 18: Trade Deficit of Afghanistan 2004-2014. Source, World Bank Reports

Since 2006, Afghanistan´s trade deficit has been widening as imports have surged due to the rise in

reconstruction work and the ensuing demand for inputs and materials. Afghanistan’s main exports

are: carpets and rugs; dried fruits and medical plans. Main imports are: petroleum; machinery and

equipment and food items. Afghanistan´s main trading partners are: Pakistan (48 percent of total

exports and 14 percent of imports) and Russia (9 percent of exports and 13 percent of imports).

Others include: Iran, China, India, Japan and Turkey.

Afghanistan's trade took off in the last decade. Since 2006, especially with the help of international

community and economic policies of the government, Afghanistan's economy has boosted the

importance of international trade. As a result of international trade to GDP ratio has gone high.

Given the trends of globalization and liberalization to the openness of Afghan economy is expected

to grow further in the coming decades.

Different sectors of Afghan exports have huge potential, what are lacked, are the other standards

that are accepted in the other parts of the world. Our potential and prospects to export to central

Asia is very high, provided if some concrete steps are taken to elevate the barriers and to implement

the agreements that we have with the CARs.

On the other hand we have good trade relations with Pakistan and Iran as well and do have a good

volume of trade but the problem is that most of this trade is done informally, especially with

Pakistan.

3.3. Importance of exports for

3.4. Employment:

Growth in exports can create employment. For

example, the growth in dry fruits, fresh fruits,

cashmeres, marbles have created many jobs in these

sectors. Traditionally export jobs have been in

manufacturing industries – an important source of full-

time employment, especially in industrial

regions. In the future years, exports could become more

diversified with a more reliance on service sector

based exports.

3.5. Economic growth:

Exports are a component of aggregate demand (AD).

Different sectors of Afghan

exports have huge potential,

what are lacked, are the

other standards that are

accepted in the other parts

of the world. Our potential

and prospects to export to

central Asia is very high,

provided if some concrete

steps are taken to elevate

the barriers and to

implement the agreements

that we have with the CARs



Page 37 of 87

Rising exports will help increase AD and cause higher economic growth. Growth in exports can

also have a knock on effect to relate ‘service industries’. For example, the success of marble,

beverages and dry/fresh fruits exports in will help the local economy with local shops benefiting

from increased spending. Similarly a fall in exports can have a big negative impact on Afghan

economy.

3.6. Current account deficit:

The strength of exports has a large role in determining the current account deficit. In the past

decade, the Afghanistan has had a persistent current account deficit, which many attribute to the

Afghanistan’s relative meagre export performance.

3.7. What determines the level of exports?

Competitiveness: The relative competitiveness of exports will play an important role in

determining the level of exports. Private sector should innovate as there is only so much the

government can do to promote private sector productivity. Competitiveness depends on new

technology and management techniques as much as any government policies.

Quality and value added of exports: For some industries like gemstone, demand is price inelastic.

Therefore, a change in price has less effect on demand. The key issue is the importance, quality and

value added of the product.

Exchange rate: Depreciation in the exchange rate will make Afghanistan’s exports more

competitive, but may contribute to cost-push inflation and will cause more expensive imports.

Lower tariff barriers: Lower tariff barriers can help increase trade. However, if you reduce

general tariff barriers, some domestic industries may lose out because they can no longer compete.

However, the theory of comparative advantage states overall economic welfare will increase – there

will just be a shift within the economy.

Exports in Afghanistan increased to 414.51 USD Million in 2013 from 375.85 USD Million in

2012. Exports in Afghanistan averaged 357.32 USD Million from 2000 until 2013, reaching an

all-time height of 837.04 USD Million in 2001 and a record low of 69.10 USD Million in 2002.

Exports in Afghanistan are collected by the Central Statistics Organization of Afghanistan.


Page 38 of 87

Graph 19: Exports of Afghanistan 2005-2014. Source: Central Statistical Organization, Afghanistan

In Afghanistan, exports account for around 20 percent of GDP. Afghanistan main exports are:

carpets and rugs (45 percent of total exports); dried fruits (31 percent) and medicinal plants (12

percent).

3.8. Exports Product-wise

Afghanistan’s exports basket is not homogeneous. The exports variety of products produced and

processed in the country. Dried fruits and carpet makes the almost half of the country’s exports.

Dried fruits and carpet makes almost 37 percent of Afghan exports with USD 1182.32 million and

1193.46 million each respectively.

143.79

305.15

383.74 416.46

454.05

544.56

403.44 388.5 375.83 414.51

Mill

ion

US$

Year (2004-2013)

Exports



Page 39 of 87

Graph 20: Product-wise Exports of Afghanistan in USD Million. Source: Central Statistical Organization, Afghanistan

Graph 21: Mail Exports of Afghanistan. Source: Central Statistical Organization, Afghanistan.

Main export partners are: Pakistan (48 percent of total exports), India (19 percent) and Russia (9

percent). Others include: Iran, Iraq and Turkey, etc.

1193.46

1182.32

237.11

270.23

138.66

60.43 45.35 32.83

Exports of Afghanistan Product-wise in USD millio

Carpet

Dried Fruits

Fresh Fruits

Herbs

Skin

Qaraqul Skin

Precious Stone

Cotton

Carpet & Rugs 45%

Dried Fruits 31%

Medicinal Herbs 12%

Others 12%

Main Exports of Afghanistan


Page 40 of 87

Graph 22: Exporting Partners of Afghanistan. Source: Central Statistical Organization, Afghanistan

3.9. Export Overview:

Throughout the past decade, slow exports growth was coupled with a soaring demand for

imports.

Afghanistan’s total exports values (of goods and services) increased by 10.31 percent from

US$ 375.85 in 2012 to US$ 414.51 million in 2013.

The average exports between 2000- 2013 stood at US$ 357.32 million. In 2001 reaching a

value of US$ 837.04 million, exports were at its highest while in 2002 estimated at US$

60.10 million exports stood at its lowest.

Exports account for about 20 percent of national GDP. Afghanistan’s exports basket is

dominated by primary and agricultural products with major share held by Carpets and rugs

(45 % of total exports), dried fruits (31 %) and medical plants (12 %).

Exports from Afghanistan to Asia and Middle East (Iraq) account for 76 percent of total

exports. Pakistan accounts for the largest export destination for Afghan merchandise exports

with 48 percent share. India 19 percent and Russia 9 percent were the second and third

largest export market, respectively for Afghanistan’s merchandise exports. Other major

export destinations for local products include Iran, Iraq and Turkey.

Pakistan 48%

India 19%

Russia 9%

Others (Turkey, Uzbekistan, China, Azerbaijan, UAE,

Europe, USA 24%

Exporting Partners of Afghanistan



Page 41 of 87

3.10. Exports of Afghanistan by country since 2009-2013

Most of Afghan exports occur with neighbouring countries like Pakistan and Iran. India account

19 percent of total exports of merchandise from Afghanistan. Pakistan accounts 30 to 48 percent

of exports from Afghanistan which is considered the largest and most important market for

Afghan merchandise, while Turkmenistan accounts only 1.1 percent of Exports.

Chart 1: Exports of Afghanistan to rest of the world. Source: MoCI-GoIRA.

Afghanistan has largely few products for export and these products are largely concentrated in a

few markets. Dried fruits accounts one-third of Afghan export basket and increased by almost

40 percent in 2013. Carpet export, another major export item shows an increase of two times in

2013 compared to last year.

ITEMS 2009 2010 2011 2012 2013 Share Increase

Edible Fruits and Nuts 4769 4436 2958 3986 5678 25.50% 42.40%

Oil Seeds and Oleaginous Fruits 1140 1514 1461 1513 2603 11.70% 72.10%

Cotton 3 262 378 408 2261 10.20% 455%

Edible Vegetables 1019 896 750 578 1814 8.20% 214%

Articles of Clothing 3 2 408 1755 7.90% 330.50%

County 2009 2010 2011 2012 2013 share Increase

Pakistan 3744.7 2852.1 4264.2 6277 6827.4 30.70% 9%

India 3360.6 4185.3 2849.9 4219 4324.5 19.4 3%

UAE 334.3 669.1 488.8 635.9 2942.8 13.20% 301%

Iran 705 997.9 766.4 734 1735.6 7.80% 173%

Iraq 537.6 358.1 549.4 623.3 1381.6 6.20% 122%

China 70.2 479.6 505.8 457.6 793 3.60% 73%

Turkey 472.9 247.5 178.6 394.7 748.1 3.40% 90%

Russian Federation 382.2 551 476.8 394.2 714.9 3.20% 81%

Tajikistan 2900.1 1868.4 349.4 301.6 600.7 2.70% 99%

Uzbekistan 27.9 41.9 9.9 175.6 472.2 2.10% 169%

Finland 3.7 29.2 43.7 172.1 375.4 1.70% 118%

United States 61.8 135.4 50 154 258.2 1.20% 68%

Turkmenistan 128.5 320.1 429.1 136 255.5 1.10% 88%

Others 1159 1344 3227 1104 1062 4.80% -4%

TOTAL Afs: 13888.5 14079.6 14189 15779 22491.9 100.00%

Million USD 279.3 295.3 294.1 307.1 400.1


Page 42 of 87

Lac; Gums, Risen, other vegetable saps and extracts 1776 2475 1851 2082 1547 7.00% -25.70%

Mineral Fuels 65 58 540 704 1115 5.00% 58.40%

Wool, Animal Hair, Horsehair, and Woven

Fabrics 182 552 491 522 702 3.20% 34.50%

Carpets and Floor Covering 356 337 238 252 614 2.80% 144.10%

raw Hides and Skins 489 431 365 616 601 2.70% -2.40%

Others 3512 2795 2638 4575 3544 15.90% -22.50%

TOTAL in Million AFN 13311 13759 11672 15644 22234 100.10%

TOTAL IN USD (Million) 279.3 295.3 294.1 307.2 400.1 Chart 2: Products exported from Afghanistan. Source: Ministry of Commerce & Industries

3.11. Export from Afghanistan to Pakistan by Product

Pakistan is continued to be a traditional and important market for Afghan products especially for

Afghan Carpet. Afghan Carpet is processed and is exported to Europe from Pakistan. Cotton export

also shows significant increasing trend to Pakistan.

ITEMS 2009 2010 2011 2012 2013 Share Increase

Cotton, Carded or Combed 2 218 342 404 2258 33% 459%

Coal 58 38 527 657 1102 16% 68%

Onions, Shallots, Garlic 426 146 206 296 602 9% 103%

Raw Skin 93 338 228 260 471 7% 81%

Carpet and Floor Covering 313 257 228 260 471 7% 213%

Graps, Fresh & Dired 966 277 334 485 350 5% -28%

Natural Steatite 27 66 156 223 314 5% 41%

Seeds, Fruits and Spores 99 58 157 129 181 3% 40%

Apricots, Cherries and Peaches 112 134 49 109 159 2% 46%

Precious Stones 22 39 51 74 78 1% 5%

Ground Nuts 72 40 45 41 72 1% 75%

Apples, Pears and Quinces (FRESH) 96 76 83 108 61 1% -45%

Carpet Woven 54 56 1% 5%

Potaotes 30 16 20 42 52 1% 5%

Melon (FRESH) 125 57 59 10 49 1% 384%

Other Fruits (FRESH) 29 54 59 10 49 1% -40%

Other 1277 1039 1780 3159 518 8% -84%



Page 43 of 87

TOTAL MILLION AFN 3747 2853 4324 6321 6843 100% 9% Chart 3: Exports of Afghanistan to Pakistan. Source: Ministry of Commerce & Industries GoIRA

Pakistan’s role in Afghanistan’s economic and political affairs is exceedingly complex, multi-

faceted.

Pakistan is Afghanistan’s largest trading partner in the region for both exports and imports, as the

destination for more than 48 percent of country’s exports, Pakistan is Afghanistan’s largest export

market. Pakistan is alleged to negatively intervening in the Afghan economy through product

dumping and restraint of trade.

While Afghanistan-Pakistan Transit Trade Agreement (APTTA) signed in 2010 was hailed as a

major step forward to facilitate trade with India, China, and beyond, but its full implementation

remains stalled, and the transit of Afghan goods through Pakistan remains a major bone of

contention, as it has from the establishment of Pakistan in 1947. As long as Afghan-Pakistan and

Indian-Pakistan relations remain problematic, APTTA is unlikely to be fully implemented.

3.12. Exports from Afghanistan to Iran by Product

Exports to Iran are increasing. It was AFN 705 million in 2009. This amount increased to AFN

1735 million in 2013. Iran is a potential market for Afghan Oil seeds and miscellaneous grains and

fruits.

Item 2009 2010 2011 2012 2013 Share Increase

Oil Seeds and Oleaginous Fruits 422.6 688.9 629 581.4 1231.1 70% 109%

Edible fruits and Nuts 106.7 82.6 45.7 17.5 287.5 17% 1539%

Wool and Woven Fabrics 63.7 45.6 8.8 68.6 112.9 7% 65%

Silk 0.1 13.6 16.4 10.7 47.6 3% 343%

Albuminoidal Substances 8.6 10.7 15 21.7 36.7 2% 69%

Edible Vegetables 55.8 71.3 4.3 1.1 19.9 1% 1705%

Articles of Stones, Plaster, Cement, Concrete 0 1.2 3.4 5.1 7.7 0% 51%

Cereals 10.6 11.2 5.4 1.2 3 0% 158%

Other 36.9 72.8 38.4 26.7 7.3 0% -73%

TOTAL AFN MILLION 705 997.9 766.4 734 1735.6 100% 136%


Page 44 of 87

Chart 4: Exports of Afghanistan to Iran. Source: Ministry of Commerce & Industries, International Trade Directorate.

Similar to India, some of the economic initiatives on the part of Afghanistan’s neighbour to the

west can be seen in the context of regional and international political competition, including

India’s oft-repeated objection to the permanent US military bases. Iran has consistently touted

the advantages of Chanahar Port as an alternative to ports in Pakistan.

Iranian companies have also made extensive investment in the western city of Herat. These

investments have been viewed with much suspicion by Afghans, who see this economic

penetration coming at the expense of Afghan small and medium as well as large enterprises but

also having an underlying political purpose.

Since 2001 Afghanistan has been an important market for Iranian consumer goods, which is

obviously important for Iran which is suffering from huge isolation imposed by western

economic sanctions. One can easily reach his hands of Iranian products even outside of herat, in

cities such as Kabul and Mazar-e-Sharif, including entire stores full of Iranian goods. As per

some official statistics, Iran is the third largest destination for Afghan products to be exported to

iran or through Iranian ports to middle east. Iran is also the third largest source of imports.

3.13. Central Asian Republics and Afghanistan Trade Scenario

(Tajikistan, Uzbekistan and Turkmenistan)

Afghanistan Shares approximately 2,140 km of border with Central Asian republics of Tajikistan,

Uzbekistan and Turkmenistan, those relations are much affected by suspicion and protectionist

policies of northern neighbors, sensitive water allocation issues from the river that flows from

Afghanistan and make up most of the border, and tensions between the republics themselves.

To facilitate the regional trade between Central Asian republics and Afghanistan some regional

economic and trade initiatives have been taken place, including New Silk Road (NSR) as well as

Central Asian Regional Economic Cooperation (CAREC).

The NSR was first articulated in September 2011 by the US Secretary of State Hillary Clinton with

the stated purpose of contribution to peace and stability in Afghanistan after 2014 through regional

economic cooperation as well as integration, especially off-setting the effects of the reduction in the

international community’s spending in the various construction, security and service sectors.

The most specific and crucial articulation of the US-led and German-backed socio-economic

initiatives include 81 proposed projects that totals USD 47.2 billion, most of which would

complement the extractive industries. Problems surrounding the initiatives sum interest in the

Central Asian States (CAS) and the private sector in making project investments, realism of the

analysis on which projects were formulated, total cohesion of the particular individual projects, the

role of Iran in these US-led initiatives, and, whatever there is sufficient stability to implement the

projects.



Page 45 of 87

This initiative is more vision than a sound and comprehensive and well implementable strategy.

Some analysts believe that the initiative is a less serious venture than political cover for the

international community’s withdrawal from Afghanistan.

Central Asia Regional Economic Cooperation (CAREC), Begun in 1996 under the guidance of the

Asian development Bank (ADB), putting emphasizes, (AREU “Afghanistan Study” 2013).

Expanding trade (Through operational priorities transport, trade facilitation, trade policy and

energy).

Improving competitiveness.

For Afghanistan, CAREC specifies master plan for each of three relevant corridors, and also

foresees the evolution of transport logistics and economic corridors.

CAREC also assumes that increased trade within each region would have more benefits than trade

with countries outside the region, an assumption that has been questioned by many political

economists around the world.

Exports by Countries (USD million)

Countries 2001 2002 2003 2004 2005 2006 2007 2008

Pakistan 52 26 26 99 258 298 265 301

India 8 10 27 11 20 23 79 81

Belgium 17 4 3 0 0 0 3 1

United States 3 1 4 0 1 2 2 1

France 0 0 0 0 0 0 0 0

Germany 5 7 6 2 1 7 4 7

Finland 1 6 9 1 0 5 8 2

Russia 5 3 3 8 4 13 29 22

United Kingdom 12 1 0 3 1 0 0 0

United Arab Emirates 4 5 5 0 0 2 3 5

Iran 0 0 1 2 4 3 5 9

Uzbekistan 0 1 4 5 5 1 2 2

Dubai 0 3 8 9 1 11 1 2

Other (Including Tajikistan) 30 1 4 4 10 19 15 21

TOTAL USD million 137 68 100 144 305 384 416 454

Countries 2001 2002 2003 2004 2005 2006 2007 2008

Pakistan -83 -131 -181 -82 -68 -96 -154 -130

India -23 -15 -9 -111 -63 -45 -46 -18

Belgium 17 4 3 0 0 0 1 0


Page 46 of 87

Source: Ministry of Commerce & Industries, International Trade Directorate

Afghanistan export basket to Tajikistan is not considerable as compared to Turkmenistan and

Uzbekistan. A very small fraction of exports of Afghanistan goes to Tajikistan due to trade barriers

and protections imposed by Central Asian countries.

3.14. Afghan-Turkey Trade Relation:

Turkey is both an important member of NATO as well as a key regional economic power in Central

Asia. Turkey has significant commercial interest in Afghanistan, especially in northern Afghanistan,

where turkey also ked the Provincial Reconstruction Team (PRT) in Sheberghan and Mazar-e-

Sharif to the west. Turkey has been involved in large number of reconstruction projects, including

roads, bridges, and schools. It has also supported education sector, building a series of well-

respected Afghan-Turk High Schools, and provided medical equipment. Turkey’s development

projects as well as activities are implemented through the Turkish International Cooperation and

Development Agency (TICDA), and many Turkish trade and construction companies. As of early

April 2013, Afghanistan and Turkey have both signed a strategic cooperation agreement that

include support to Afghan National Security Forces (ANSF) through equipment and training and

economic cooperation.

United States -1 0 3 -10 -23 -56 -45 -26

France -1 -18 -21 -7 -7 -41 -22 -6

Germany -11 -9 -43 -82 -181 -54 -44 -48

Finland 1 6 9 1 0.3 0 8 2

Russia 1 -100 -143 -174 -130 -214 -281 -337

United Kingdom 12 1 0 3 1 0 -10 -9

Japan -491 -594 -999 -299 -353 -414 -418 -495

Iran -5 -36 -112 -106 -119 -191 -184 -129

Korea -93 -105 -113 -22 -79 -64 -113 -101

Kenya -47 -52 -57 -55 -22 -34 -4 -28

Turkmenistan -42 -46 -50 -14 -26 -30 -29 -58

Uzbekistan 0 0 0 0 0 0 -122 -165

Singapore -7 -3 -2 -1 -1 -2 -4 -5

China -22 -35 -57 -382 -385 -316 -473 -611

Kazakhstan -64 -20 -22 -7 -12 -49 -85 -74

Others (Including Tajikistan) -180 -475 -567 -609 -404 -481 -303 -242

TOTAL BALANCE, USD million -1039 -1628 -2352 -1957 -1872 -2087 -2328 -2568



Page 47 of 87

3.15. International Trade Turnover of the Republic of Tajikistan

With the Islamic Republic of Afghanistan

According to the official information for 2014 the trade turnover of goods of the Republic of

Tajikistan with the Islamic Republic of Afghanistan reached to US 105,7 mln., it constitutes 2

percent of total foreign trade turnover of the Republic of Tajikistan.

The growth rate of foreign trade of the Republic of Tajikistan with the Islamic Republic of

Afghanistan for 2014 compare with previous year decreased to 10,8 percent, based on value US

12,9 mln.

As of 2014 in the structure of the bilateral trade relations between the Republic of Tajikistan

and the Islamic Republic of Afghanistan the export of goods consist of US 53,3 mln., and import

US 52,4 mln.

The most exporting products from the Republic of Tajikistan to the Islamic Republic of

Afghanistan are: electricity, plant goods and black metals. The main importing goods are: sugar,

mineral resources, cement and citrus fruits.

The main indicators of foreign trade turnover of the Republic of Tajikistan with

the Islamic Republic of Afghanistan for 2011-2014

(mln. US)

2011 2012 2013* 2014*

The foreign trade turnover

of Republic of Tajikistan

with Islamic Republic of

Afghanistan

133,9 232,0 118,6 105,7

- export 94,4 192,2 49,5 53,3

- import 39,5 39,8 69,1 52,4

*Note: the indicators for 2013 and 2014 are calculated based on the general customs methodology

of the foreign trade of the CIS member countries in new addition.


Page 48 of 87

Source; Ministry of Economic Development and Trade of the Republic of Tajikistan.

3.15. Challenges for Export Promotion

Lack Proper product promotion strategy

Lack of proper implantation trade agreements, like APTA SAFTA etc.,

Short-run trade strategies, this makes the trading counterparts uninterested

Unofficial exports, that is not included in export share in GDP

Lack of insurance strategy for exporters and their products

Security of transit channels

Lack of product brands for Afghan products

Afghanistan in various sectors, especially private-SME sector could not develop a proper policy as

well as a sound and well defined strategy to promote its products in international market to demand.

Some agreements on trade barriers are only papers in the ministries. They do not full implement and

thus make it very difficult for exporters. Agreements like APTA and SAFTA, was not fully

implemented, due to some misinterpretations and lack of proper introduction of it, to the exporters.

Almost all the enterprises vanish from the existing market in two to three years of operation. This is

due to short run strategies regularly adopted by SMEs. The Afghan product and SMEs do not have a

recognized brand in international market. Afghanistan carpet is exported from Pakistan with the

Pakistani brands to the international market. Almost half of the Afghan exports are not registered

and thus are not included in the official registry books of custom departments.

3.16. Policy Recommendations for Increasing Afghan Exports to

South and Central Asia and Beyond

As discussed earlier, the performance of Afghan exports (in value and volume terms) lags behind

the country’s rate of economic growth. The post-war reconstruction needs of Afghanistan for

intermediate material and a booming consumption demand have resulted in a skewed trade balance

toward imports.

Therefore, observing the persistent underperformance of exports together with a narrow export base

(undiversified market) the findings from this report suggest that the Ministry of Commerce and

Industries and its related government agencies should design a targeted trade strategy (with clear

policy roadmaps) to the SME’s and broader private sector development in Afghanistan. The need

for such a strategy stems from the fact that the previous and existing policy approaches are

fragmented and thus cannot be sufficient to solve Afghanistan’s fundamental economic problems.

A key focus of this strategic approach in particular should be the creation of a favorable

environment such that the private sector enterprises are able to procure inputs at low costs and

subsequently produce low cost but quality goods to satisfy domestic and foreign demand.




Page 49 of 87

1. Inputs which crucial for the domestic production in different sectors of the economy, are

found in scarce supply. The government should facilitate SME’s access to inputs (at low

costs). In the long run the success of such an approach can undeniably significantly help

Afghanistan substitute similar foreign products with domestic products. This can certainly

also positively affect Afghanistan’s competitiveness as production value chains are

developed and each and every sector reaches a higher ladder in the standard and quality

value chain.

2. Related to the above is the establishment of export development zones (EDZ) across the

country. From tax incentives to basic infrastructure, low cost and timely access to inputs

required for the production of goods, EDZ’s can make a big difference both to exports, job

creation and ultimately sustained eradication of rural and urban poverty through the creation

of positive externalities as a result.

3. Although CSO gathers and disseminates statistics on the performance of the economy

including international trade (exports and imports), developing a special database within

the MoCI to gather, feed and analyze domestic and global trade data as it relates to

Afghanistan’s engagement with its immediate, far and global trade partners.

4. The factual assessment of impacts of trade and investments agreements on macroeconomic

indicators and welfare of Afghan people is an area that demands serious attention. With the

availability of reliable and rich data, the policy analysts will be capable to carry out analysis

and inform the decision makers on key trends, evaluate the effects of trade agreements and

regularly produce top quality policy recommendations so that MoCI can take appropriate

policy measures in line with the rapidly evolving regional and global trade environment.

Using sound data and diagnosis tools, for instance an annual or bi-annual Assessment of

the Employment and Growth Effects of Trade can better guide the concerned policy

makers to anticipate and address any potential negative effects of Afghanistan’s bilateral

and multilateral ties.

5. The shortages of skilled labor have serious implications for the development of a

competitive export base in Afghanistan. Despite the existence of vocational training

programs labeled as TVET, the scarcity of and gaps observed in the skills of the labor force

demands scaling up and stretching such programs across the country. In this regard, MoCI

has to engage in discussions with the ministries of higher education and invite the donor

agencies to lend support for the creation of an educational and training center for

instance something in the form of Skills Development Institute for Trade Success

(SDITS). Executive Officers of SME’s and national investors should be encouraged to enter

into agreements with the institute to regularly train the workers, upgrade their skills level

and competence.

To put things into perspective, a focus on training the workers in emerging national

industries such as in Metal, Pharmaceuticals, Food and Garment sectors will pay

significantly higher dividends in terms of improved quality and expansion of exports of

made-in Afghanistan products. In this regard, a branch of the institute dedicated to provide

in-factory advice and counselling tailored to the needs of workforce (according to the type

of industry) to efficiently and effectively execute tasks can prove invaluable for improving

productivity.


Page 50 of 87

6. As a predominantly agricultural economy, Afghanistan has to develop its agri-business

sector. Developing this sector as regionally and globally competitive one demand efforts to

help national agricultural sector climb the value chain, provide cold storage facilities and

meet the packaging requirements. In addition, the supply of basic inputs such as water,

seeds, machinery and power should be placed at the top list of priorities.

7. While much remains to be done to place Afghanistan economic development on a solid

footing, focusing on agribusiness, natural and mineral sector in the medium term holds

the potential to change the structure of the economy. Therefore, the integrated trade

strategy should focus on the expansion of trade (exports to regional and international

markets) in agribusiness and natural and mineral resources.

8. Agribusiness: The Case for Cotton Exports

The cotton sub-sector is a major part of the agricultural sector. Afghanistan has great

potential for growth in the cotton sector. It also holds the potential to revive the textile

industry in Afghanistan while supply enough to meet international demand – earning foreign

exchange. But with low level of investments in technology, lack of improved seeds and

failure to adopt quality improvement measures, this sector has lagged behind. The figure

below depicts the evolution of cotton lint and seed production over the 2002 – 2011 periods.

The development of export oriented textile industries depends on the supply capacity of the

cotton. Encouraging investments in agricultural technology and giving incentives to private

producers and ginners will help expand cotton production in Afghanistan.

3.17. Afghanistan and Regional Integration

Regional interconnectedness and cooperation in the areas of trade, investment and transfer of

technical knowhow, between Afghanistan and Asia has experienced a positive shift since the new

Afghan administration came into existence.

in t

on

ne

s

Cotton lint and seed Production in Afghanistan

Cotton lint

Cotton seed



Page 51 of 87

From enhanced access to regional markets to low cost procurements of inputs and imports,

Afghanistan stands to benefit from regional cooperation. To reap maximum benefits from its unique

geostrategic location, Afghanistan should make every effort to be an active regional player

attracting regional investments in the road, electricity and health and education sectors.

The Asian economies in particular the Central Asian region in turn have high stakes in the

economic growth generated in Afghanistan. For instance, investment in and proper exploitation of

rare resources such as aluminum and copper, to name but a few rare earth resources found in

abundantly supply in Afghanistan, can contribute to build a resource-based manufacturing export

base in Afghanistan while at the same time satisfy the industrial growth demands of energy and raw

material scarce countries in the region.

However, the low share of investment allocated to the growth enhancing sectors has made it less

likely to exploit this potential. Therefore, given the regions needs for industrial growth and in light

of its evolving stage of economic development, major and new regional trade partners of

Afghanistan should come up with a regional investment and economic growth strategy backed by a

strong political commitment to enable the business sector investments in Afghanistan. Such

investments will most likely contribute to the achievement of development goals of Afghanistan

while at the same time provide an opportunity for the foreign investors to seize the untapped

opportunities and thereby reap higher profits not offered elsewhere in the region.

Regional investment projects in the energy and infrastructure sectors supported by strong political

commitment will certainly allow these countries to improve their economic performance and

overcome the broader set of challenges that impede their growth prospects and constrain their

ability to uplift their people out of abject poverty.

In recent past the blockages at the Pakistani border have caused serious hurdles to the Afghan

investors and consumers alike. Overcoming this problem Afghanistan should further deepen its

trade and transit ties with Central Asian countries.


Page 52 of 87

4.1. Formalization

The informal sector in any particular economy consists of branches of economies, where they do

not find it suitable to be registered due some economic, social and political reason with government

agencies. Thus informal sector refers to that employment-creating and income generating branch of

economy which is not controlled by formal arrangements. The informal sector also refers to the

activities of people who are self-employed at low levels and who lacks proper/formal organization

(ILO). The definition of informal sector for the first time appeared in a report of ILO in 1972, which

was an outcome of a joint employment mission by ILO/UNDP in Kenya.

The report defined informal sector as “labor intensive because of huge workers turnover, family

owned, small-scale, unregulated and easy to enter” branch of the economy (ILO, 1972). In this

informal segment of an economy, workers are “unprotected” in terms of fixed wages and other job

assurance such as paid leaves, sick leaves and even vacations (Herberger, 1971). Since the informal

sector was so encompassing and huge, many scholars contributed to narrowing it down to specific

aspects such as health, employment, socio-cultural and political relations which it appertained.

In economic context informal sector refers to the various economic and business activities which

escape official regulatory controls such as organization and registration. People and enterprises

engage in this sector of the economy are called informal workers and enterprises and comprise

domestic workers and non-agriculture business conducts.

Formalization of business enterprises is given high priority by the Government of Afghanistan. This

Strategy brings together the key issues and considerations that relate to accelerating the process of

formalization. It also includes strategies and an action plan for implementing those strategies.

Formalization refers to the process whereby informal enterprises become integrated into the formal

economy, which is regulated by state-sanctioned economic and legal processes and institutions. The

informal sector is a general market income sector where certain types of income and the means of

their generation are unregulated by the institutions of society, in a legal and social environment in

which similar activities are regulated (Porters and Haller, 2005).

Informal economic activities are those that are not subject to the regulation and control of the

government. They are not registered or listed in any government registries or databases.

In this report the cost and benefit analysis of formalization process is preceded so that Islamic

Republic of Afghanistan after adopting proper policy measures would be able to convince business

entities, micro, small and medium to register themselves with a proper recognized official

government agency. In Afghanistan the process of registry is far weak and not capable. A single

registry office does not exist for business entities. People of Afghanistan do not recognize the new

economic system of free market, where private sector plays a vital role in the development process.

And development process in such an economy is possible only when the number of operating

enterprise is correctly known. In rural Afghanistan most businesses are run by families and they do

not consider it important to get their businesses registered. They think business registry with a

particular government agency mean taxation.



Page 53 of 87

Based on unique data consisting of both formal and informal firms, this paper examined the

relationship between legal status and firm level outcomes in micro, small and medium enterprises

(SMEs) in Afghanistan. Using a matched double difference approach, we investigate whether

formalization is associated with a change in profits, investments, access to credit and the status of

workers, controlling for initial conditions or time-variant factors that may simultaneously influence

the decision to formalize and subsequent firm performance. We find causal evidence that becoming

officially registered leads to an increase in profits and investments, and a decrease in the use of

casual labor thereby improving contract conditions for

workers. Moreover, formal firms have better access to

credit. Thus, we conclude that formalizing is beneficial

both to firms and the workers in these firms.

Informality constitutes a growing feature of many

developing countries, and notwithstanding its

heterogeneity, the informal sector is generally associated

with low productivity, limited or no social security for

workers and poor working conditions. Existing work on

informality focuses mostly on its causes, characteristics

and consequences, while research devoted to exposing the

benefits of formalization is scarcer. This is partly due to a

lack of appropriate data, especially on micro (household)

firms, which ironically, are precisely the kinds of firms

that are most likely to be operating informally. Moreover,

in much of the literature, informality is perceived as an

involuntary condition brought about by excessive

regulation and weaknesses of the legal system (Dabla-

Norris et al., 2008). However, more recent work (Maloney, 2004) has revealed that remaining

unofficial is often a conscious choice based on the “degree of attractiveness” of informality versus

formality. Thus, efforts to unveil the potential gains of formalization could serve to incentivize

firms, as well as workers, to shift out of informality.

Our aim in this section is to study the issues on development of SMEs in Afghanistan related to

informality. The study in particular is aimed disseminating the policy directions/choices the Private

Sector and SME Directorate of the Ministry of Commerce and Industries on how and why the

informal enterprises/SMEs can be brought under the formal, legal structure.

Afghan SMEs are 80 percent, with no legal status. They are rarely registered with a legally

authorized government institution. This is partly due to trust-deficit between parties engaged.

Afghanistan SMEs consider short run business conduct more crucial than sustainable business

operation in the long run, and thus make them not to be partly or full registered with government.

Afghan SME owners partly are not aware of cost-benefits of registration of their businesses, say

Ahmad Rehsad (Name Changed). The public awareness regarding business registry strategy is far

weak to convince SME business holders in order to bring them under rules and regulations of

government.

The multiple registry bodies in Afghanistan have made it difficult, even impossible for SMEs to

make proper decision to be formalized. In Afghanistan various regulatory bodies are assigned to

give permit for business conduct. Registry bodies like, City Municipalities, Ministry of Commerce

and Industries and AISA etc., permits businesses to operate in various filed.

Key Problems of Formalization:

Higher costs of

registration

Multiple-authority for

business registration

Centralized Registry

authorities

Public, unaware of cost-

benefit of business

registration


Page 54 of 87

SME formalization will help government to generate extra revenue, as 80 percent of SME are not

fully or partly registered with governmental authorized bodies. SME registration will help the

businesses to access credit and finance and will also help businesses to reach the highest levels of

profits.

4.2. Recommendations for Tackling Informality

For a majority of Afghans informal jobs are the main and only source of income. As such,

throughout the country, employment provided by the informal sector enterprises is widespread.

The problem, viewed from the perspective of the workers, with the informal economic activity is

that it entails low pay, poor working conditions, gender inequality, and offers no job security.

However, the challenge for the government is that revenue in the form of taxation and registration

fees are evaded. Moreover informal businesses do not invest in technology, offer no training and

skills development opportunities to their workers and finally fail to contribute to national

productivity. It is through the operation of these factors that the existence of informal business

entities causes serious constraints to Afghanistan’s sustained and long-term economic development.

Despite the fact that informal sector offers a major share of employment, concrete policy measures

targeted at facilitating the transition from informality to formality should be adopted by the

Ministry of Labor and Social Affairs in close

collaboration with MoCI and other government agencies.

In doing so the concerned authorities first need to find

convincing answers to the following and related

questions: how can the government ensure that a

transition from informality into legal self-employed work

proves viable?

An important part of answering the question requires a

thorough understanding of the extent, structure and key

drivers of informal trade and wider economic activity. To

do so, statistics on the actual size of the informality in the

private sector and household level should be gathered,

analyzed and made available to the decision making

authorities within the government structure.


Public awareness

program regarding cost-

benefit of business

registration in rural

Afghanistan

Establishment of a

singular business

registry authority and its

sub-offices across the

country

To lower the cost of

business registry

Giving government

incentives to the new

registered businesses in

terms of tax holidays

Some access to finance

benefits for the newly

registered businesses



Page 55 of 87

Annex

Annex 1.

Financial Institutions, currently engaged in credit business in Afghanistan. Chart below provides a

clear vision, on their gross loan portfolio, number of active borrowers, and total deposits. Figure in

USD million & business entities respectively. Figure 0, represents no data available.

Financial Institution Name Operation Currency

Period Gross Loan

Portfolio

Number of Active

Borrowers Deposits

Number of Depositors

Ariana Financial Services USD 2003 3,08,897 a 0 0

Ariana Financial Services USD 2004 2,43,110 1,911 0 0








Afghan Micro Finance Institution USD 2004 1,09,200 304 0 0

Afghan Micro Finance Institution USD 2005 5,31,623 1,736 0 0






Afghanistan Rural Micro Credir Program USD 2003 78,833 722 0 0

Afghanistan Rural Micro Credir Program USD 2004 30,72,903 4,907 0 0

Afghanistan Rural Micro Credir Program USD 2005 84,30,793 15,670 0 0

Afghanistan Rural Micro Credir Program USD 2006 1,68,89,524 30,346 0 30,346

Afghanistan Rural Micro Credir Program USD 2007 2,06,90,527 30,719 0 0


Page 56 of 87

Afghanistan Rural Micro Credir Program USD 2008 1,52,80,822 21,905 0 0

Afghanistan Rural Micro Credir Program USD 2009 0 0 0 0

Bangladesh Rural Advancement

Committee/BRAC-AFG USD 2002 44,470 264 0 0


Committee/BRAC-AFG USD 2003 7,86,975 15,710 0 0


Committee/BRAC-AFG USD 2004 35,85,947 55,572 8,91,195 0


Committee/BRAC-AFG USD 2005 74,63,597 87,153 22,62,429 72,804


Committee/BRAC-AFG USD 2006 2,07,80,335 1,38,625 50,50,069 1,08,573











Child Fund Afghanistan USD 2005 9,09,926 7,100 0

Child Fund Afghanistan USD 2006 17,43,375 10,430 1,06,782 10,430





Child Fund Afghanistan USD 2011 15,30,560 6,817 86,833 No Data

Foundation for International Cummunity Assistance (FINCA-AFG) USD 2004 2,77,890 2,864 0

Foundation for International Cummunity Assistance (FINCA-AFG) USD 2005 13,89,805 10,092 0 0



Page 57 of 87


Foundation for International Cummunity Assistance (FINCA-AFG) USD 2007 1,18,15,480 63,571 0 0

Foundation for International Cummunity Assistance (FINCA-AFG) USD 2008 47,98,254 33,289 0





Foundation for International Cummunity Assistance (FINCA-AFG) USD 2013 2,27,159 24,348 1,01,352 49

First Micro Finance Bank (FMFB) USD 2004 23,50,835 2,111 95,107 156

First Micro Finance Bank (FMFB) USD 2005 74,63,097 8,302 48,80,283 2,498

First Micro Finance Bank (FMFB) USD 2006 1,68,65,918 16,955 48,62,648 9,426

First Micro Finance Bank (FMFB) USD 2007 2,71,62,857 23,616 0 25,111






First Micro Finance Bank (FMFB) USD 2013 7,40,41,530 60,053 0 0

OXUS-Afghanistan USD 2005 84,437 616 0 0


Page 58 of 87

OXUS-Afghanistan USD 2006 8,02,440 5,621 0 0






OXUS-Afghanistan USD 2012 89,29,293 8,662 4,13,528 8,662


Mutahid USD 2011 1,16,523 222 75,734 2,341

Mutahid USD 2012 8,88,610 3,194 94,522 0

Mutahid USD 2013 14,31,590 3,648 0 0

MADRAC USD 2005 66,207 886 0 0

MADRAC USD 2006 11,95,027 8,249 34,136 11,152

MADRAC USD 2007 26,62,430 15,358 1,31,072 15,358

MADRAC USD 2008 26,67,526 15,452 1,78,927 15,452

MADRAC USD 2009 28,18,208 13,853 2,38,596 15,378

MADRAC USD 2010 2,20,120 780 0 0



Page 59 of 87

Annex 2.

Financial Institutions, currently engaged in credit business in Tajikistan. Chart below provides a



Financial Institution

Name Currency Fiscal Year

Gross Loan Portfolio

Number of active

borrowers Deposits Number of depositors

AccessBank Tajikistan USD 2010 38,67,500 1,369 1,47,045 0

AccessBank Tajikistan USD 2011 1,21,65,966 4,815 3,01,891 4

AccessBank Tajikistan USD 2012 2,11,04,587 6,411 2,98,550 336

AccessBank Tajikistan USD 2013 3,91,54,143 7,229 16,65,252 6,609

AccessBank Tajikistan USD 2014 4,24,87,513 7,776 14,94,059 8,291

Agroinvestbank USD 2002 1,44,51,908 0 0

Agroinvestbank USD 2003 1,69,06,088 850 0 0

Agroinvestbank USD 2004 3,02,69,312 1,577 0 33,941










Amlok USD 2008 1,38,838 0 18,913 0

Amlok USD 2009 2,14,946 389 25,789 5

Amlok USD 2010 5,25,594 365 1,61,263 17

Amlok USD 2012 12,65,982 501 2,26,636 0

Amlok USD 2013 13,28,037 0 0 0

Armon USD 2010 79,702 226 0 0

Armon USD 2013 40,576 0 0 0

ASTI USD 2002 20,938 343 0 0

ASTI USD 2003 30,694 375 0 0

ASTI USD 2004 64,622 683 0 0

ASTI USD 2005 1,00,333 529 0 0

ASTI USD 2006 1,84,420 601 0 0

ASTI USD 2007 2,49,844 714 0 0

ASTI USD 2008 3,11,205 670 0 0


Page 60 of 87

ASTI USD 2012 2,81,845 386 0 0

ASTI USD 2013 3,58,046 0 0 0

Bank Eskhata USD 2003 16,85,068 321 0 82

Bank Eskhata USD 2004 37,63,430 876 0 118

Bank Eskhata USD 2005 49,48,369 1,579 55,31,166 295

Bank Eskhata USD 2006 1,17,17,003 2,152 95,85,741 198

Bank Eskhata USD 2007 2,32,45,376 5,174 0 5,298

Bank Eskhata USD 2008 4,38,38,261 10,988 0 11,106

Bank Eskhata USD 2009 3,29,05,950 8,488 0 9,933

Bank Eskhata USD 2010 4,74,22,500 9,531 0 18,248

Bank Eskhata USD 2011 6,53,35,121 16,208 0 0

Bank Eskhata USD 2012 8,44,58,317 21,727 0 56,178

Bank Eskhata USD 2013 12,25,94,076 46,285 0 78,174

Bank Eskhata USD 2014 15,28,42,500 46,285 0 88,221

Borshud USD 2005 4,82,821 662 0 0

Borshud USD 2006 6,65,816 1,992 0 0

Borshud USD 2007 8,23,330 2,284 0 0

Borshud USD 2008 12,02,704 2,279 0 0

Borshud USD 2009 11,47,628 2,028 0 0

Borshud USD 2010 13,40,112 1,557 0 0

Borshud USD 2011 11,05,046 1,557 0 0

Borshud USD 2013 9,06,747 0 0 0

Credit-express USD 2006 2,93,012 203 0 0


Credit-express USD 2008 11,73,116 0 9,82,779 0




Dastras USD 2008 0 0 0 0

Dastras USD 2009 2,03,281 45 606 1

Dastras USD 2010 2,33,314 80 2,525 4

Dastras USD 2012 11,10,203 228 1,10,472 0

Ehyoi kuhiston USD 2006 0 0 0 0

Ehyoi kuhiston USD 2007 4,75,022 0 0 0

Ehyoi kuhiston USD 2008 5,58,282 1,700 0 0

Ehyoi kuhiston USD 2009 4,64,367 1,515 0 0



FINCA - TJK USD 2004 94,172 465 0 0

FINCA - TJK USD 2005 7,29,036 1,962 0 0

FINCA - TJK USD 2006 21,49,619 4,690 0 0

FINCA - TJK USD 2007 47,20,046 11,056 0 0

FINCA - TJK USD 2008 73,34,994 15,705 0 0

FINCA - TJK USD 2009 50,36,644 23,662 4,348 0

FINCA - TJK USD 2010 72,97,464 0 14,073 0

FINCA - TJK USD 2011 94,49,789 19,991 11,363 0

FINCA - TJK USD 2012 1,57,99,789 26,961 13,811 66



Page 61 of 87

FINCA - TJK USD 2013 2,12,01,020 0 0 0

FinDom USD 2006 1,21,243 32 0 3

FinDom USD 2007 5,92,781 132 0 23

FinDom USD 2008 8,77,054 175 0 15

FinDom USD 2010 3,92,631 121 0 0

FMFB - TJK USD 2004 5,65,578 430 0 388

FMFB - TJK USD 2005 35,94,699 2,740 2,47,431 2,468

FMFB - TJK USD 2006 74,50,793 6,755 6,22,902 3,805

FMFB - TJK USD 2007 2,00,36,299 17,778 33,65,564 3,027

FMFB - TJK USD 2008 3,25,50,227 13,153 0 7,077

FMFB - TJK USD 2009 2,05,41,969 11,546 0 7,547

FMFB - TJK USD 2010 2,53,87,338 12,597 0 7,854

FMFB - TJK USD 2011 2,39,79,412 12,892 0 9,850

FMFB - TJK USD 2012 2,83,69,134 14,155 0 11,946

FMFB - TJK USD 2013 4,18,39,119 16,634 0 29,918

FMFB - TJK USD 2014 4,57,63,540 17,589 0 35,968

Furuz USD 2004 1,15,942 205 0 0

Furuz USD 2005 1,60,213 269 0 0

Furuz USD 2006 3,26,461 497 0 0

Furuz USD 2007 5,33,557 806 0 0

Furuz USD 2008 9,15,432 1,464 0 0

Furuz USD 2009 2,44,175 552 0 0

Furuz USD 2010 3,45,896 683 0 0

Furuz USD 2012 7,47,651 831 0 0

Furuz USD 2013 8,88,705 0 0 0

GvT USD 2005 1,75,818 217 0 0

GvT USD 2013 2,48,155 0 0 0

Haqiq USD 2005 97,047 772 0 0

Haqiq USD 2006 2,69,503 1,061 0 0

Haqiq USD 2007 4,41,347 1,419 0 0

Haqiq USD 2013 2,39,935 0 0 0

Imdodi Rushd USD 2008 0 0 0 0

Imdodi Rushd USD 2009 1,40,565 229 0 0

Imdodi Rushd USD 2012 6,21,876 0 0 0

Imdodi Rushd USD 2013 2,93,898 0 0 0

Imkoniyat Hovar USD 2003 2,42,872 2,432 0 3,534

Imkoniyat Hovar USD 2004 2,80,510 1,867 0 215










Page 62 of 87

Imkoniyat Hovar USD 2013 16,78,494 0 0 0

Imodi Hutal USD 2006 0 0 0 0

Imodi Hutal USD 2007 4,14,972 0 0 0

Imodi Hutal USD 2008 5,05,584 2,157 0 0

Imodi Hutal USD 2009 4,63,814 2,085 0 0

Imodi Hutal USD 2011 6,84,456 2,445 0 0

Imodi Hutal USD 2013 7,68,158 0 0 0

IMON USD 2000 4,92,492 4,082 0 1,299

IMON USD 2001 8,23,177 5,342 0 1,813

IMON USD 2002 10,58,793 6,202 0 4,496

IMON USD 2003 12,82,402 5,316 4,331 464

IMON USD 2004 18,03,130 6,034 0 0

IMON USD 2005 37,19,936 10,173 0 0

IMON USD 2006 79,40,607 14,182 0 0

IMON USD 2007 1,48,60,228 19,696 0 0

IMON USD 2008 3,05,48,721 26,661 0 0

IMON USD 2009 2,89,80,142 26,602 0 0

IMON USD 2010 3,40,81,595 28,900 0 0

IMON USD 2011 4,52,16,421 42,503 0 0

IMON USD 2012 6,84,74,473 58,186 0 0

IMON USD 2013 10,14,00,238 70,363 36,60,344 1,015

IMON USD 2014 11,34,19,795 77,750 48,04,714 1,453

Ishkoshim USD 2007 68,410 174 0 0

Ishkoshim USD 2012 1,27,946 186 0 0

Ishkoshim USD 2013 1,26,223 0 0 0

JOVID USD 2004 1,15,143 510 0 0

JOVID USD 2005 1,68,986 569 0 0

JOVID USD 2006 2,61,344 783 0 0

JOVID USD 2007 3,83,871 660 0 0

JOVID USD 2008 5,45,334 633 0 0

JOVID USD 2009 4,64,485 795 0 0

JOVID USD 2010 5,12,297 768 0 0

JOVID USD 2012 5,19,944 770 0 0

JOVID USD 2013 6,14,470 0 0 0

Madina va Hamkoron USD 2005 21,543 192 0 0



Madina va Hamkoron USD 2008 1,49,703 328 0 0





Page 63 of 87


Maqsadi dasgiri USD 2008 29,334 107 0 0

Matin USD 2009 7,41,862 195 9,00,492 21

Matin USD 2010 27,59,572 1,017 23,64,322 142

Matin USD 2011 67,35,941 3,036 46,52,688 613

Matin USD 2012 1,08,52,513 5,951 65,73,983 697

Matin USD 2013 1,35,92,398 0 0 0

MDO 'Spitamen capital' USD 2009 12,86,285 221 3,40,914 11

MDO 'Spitamen capital' USD 2012 37,45,518 260 1,08,139 0

MDO Arvand USD 2002 50,584 425 0 0

MDO Arvand USD 2003 2,45,161 1,355 0 0

MDO Arvand USD 2004 6,03,681 2,317 0 0

MDO Arvand USD 2005 9,30,934 3,355 0 0

MDO Arvand USD 2006 21,76,305 5,849 0 0

MDO Arvand USD 2007 52,66,814 10,435 0 0

MDO Arvand USD 2008 81,81,026 13,098 0 0

MDO Arvand USD 2009 41,30,281 7,896 10,085 390

MDO Arvand USD 2010 85,37,114 12,218 1,52,464 593

MDO Arvand USD 2011 1,32,38,804 15,392 2,60,336 970

MDO Arvand USD 2012 2,06,72,269 19,356 5,89,496 2,507

MDO Arvand USD 2013 2,59,94,876 0 0 0

MDO Arvand USD 2013 3,05,43,924 24,800 28,97,043 6,407

MDO Nisor Fom USD 2008 4,48,426 0 15,421 0

MDO Nisor Fom USD 2009 6,68,133 185 2,86,720 19

MDO Nisor Fom USD 2010 7,53,707 136 0 0

MDO Nisor Fom USD 2012 4,49,313 69 4,36,606 0

MLF Baror USD 2005 5,850 50 0 0

MLF Baror USD 2006 5,699 55 0 0

MLF Baror USD 2007 5,447 8 0 0

MLF Baror USD 2012 50,397 41 0 0

MLF Baror USD 2013 60,039 0 0 0

MLF Chiluchor chashma USD 2006 0 0 0 0

MLF Chiluchor chashma USD 2007 1,11,112 0 0 0


MLF Chiluchor chashma USD 2009 96,678 153 0 0



Page 64 of 87


MLF Kiropol USD 2005 71,812 209 0 0

MLF Kiropol USD 2006 84,314 170 0 0

MLF Kiropol USD 2007 1,43,507 0 0 0

MLF Kiropol USD 2008 1,91,041 518 0 0

MLF Kiropol USD 2009 18,882 86 0 0

MLF Kiropol USD 2010 14,766 47 0 0

MLF Kiropol USD 2011 3,27,481 395 840 1

MLF Kiropol USD 2012 3,46,981 198 19,336 0

MLF Kiropol USD 2013 4,26,820 0 0 0

MLF Nasrin USD 2008 5,072 10 0 0

MLF Vahsh Microfin USD 2007 5,45,262 0 0 0

MLF Vahsh Microfin USD 2008 6,80,143 1,801 0 0






MLF ZAR USD 2003 8,308 49 0 0

MLF ZAR USD 2004 21,638 74 0 0

MLF ZAR USD 2005 40,602 130 0 0

MLF ZAR USD 2006 59,289 136 0 0

MLF ZAR USD 2007 1,11,559 172 0 0

MLF ZAR USD 2008 1,08,006 126 0 0

MLF ZAR USD 2009 1,48,457 244 0 0

MLF ZAR USD 2010 1,83,796 270 0 0

MLF ZAR USD 2011 3,38,132 488 0 0

MLF ZAR USD 2012 4,84,183 589 0 0

MLF ZAR USD 2013 4,70,968 0 0 0

MLO 'Saodat Invest' USD 2005 0 0 0 0



MLO 'Saodat Invest' USD 2008 75,719 185 0 0




Page 65 of 87


MLO HUMO USD 2008 54,32,923 7,886 0 0

MLO HUMO USD 2009 32,67,173 7,750 0 0

MLO HUMO USD 2010 57,11,198 9,340 0 0

MLO HUMO USD 2011 99,21,862 14,646 0 0

MLO HUMO USD 2012 1,66,48,554 20,075 0 0

MLO HUMO USD 2013 2,80,05,629 30,683 0 0

MLO HUMO USD 2014 3,04,75,016 33,475 0 0

MLO Mehnatobod USD 2003 19,505 213 0 0




MLO Mehnatobod USD 2007 95,236 0 0

MLO Mehnatobod USD 2008 1,75,046 330 0 0






Nov Credit USD 2007 1,76,011 0 0 0

Nov Credit USD 2008 3,18,315 1,147 0 0

Nov Credit USD 2009 4,19,800 1,143 0 0

Nov Credit USD 2010 5,88,888 1,193 0 0

Nov Credit USD 2011 8,19,044 0 0 0

Nov Credit USD 2012 6,14,531 529 0 0

Nov Credit USD 2013 7,04,813 0 0 0

OXUS - TJK USD 2003 3,05,367 9,040 0 0

OXUS - TJK USD 2004 6,06,339 10,360 0 0

OXUS - TJK USD 2005 7,50,000 4,239 0 0

OXUS - TJK USD 2006 14,97,122 5,361 0 0

OXUS - TJK USD 2007 39,51,519 6,805 0 0

OXUS - TJK USD 2008 71,05,248 8,840 0 0

OXUS - TJK USD 2009 53,50,511 6,581 0 0

OXUS - TJK USD 2010 74,54,129 7,631 0 0

OXUS - TJK USD 2011 1,04,61,102 8,355 0 0


Page 66 of 87

OXUS - TJK USD 2012 1,54,02,382 10,847 0 0

OXUS - TJK USD 2013 1,90,92,793 0 0 0

Phoenix + USD 2007 3,69,685 0 0 0

Phoenix + USD 2008 5,52,971 0 0 0

Phoenix + USD 2009 5,49,807 594 0 0

Phoenix + USD 2010 7,69,366 963 0 0

Phoenix + USD 2011 10,16,465 1,325 0 0

Phoenix + USD 2012 12,73,201 1,692 0 0

Phoenix + USD 2013 14,04,466 0 0 0

SAS USD 2002 2,13,499 41 0 0

SAS USD 2003 5,27,053 75 0 0

SAS USD 2004 8,24,358 122 0 0

SAS USD 2005 9,89,172 149 0 0

SAS USD 2006 10,54,956 216 0 0

SAS USD 2012 4,73,612 109 0 0

Sugd Microfin USD 2006 0 0 0 0

Sugd Microfin USD 2007 4,30,405 2,890 0 0





Sugd Microfin USD 2013 6,44,855 0 0 0

Tavildara USD 2006 31,153 50 0 0

Tavildara USD 2007 33,815 84 0 0

Tojsodirotbonk USD 2003 1,15,32,870 487 0 3,697

Tojsodirotbonk USD 2004 1,41,42,477 1,251 0 4,764

Tojsodirotbonk USD 2005 1,76,30,378 3,134 0 5,220

Tojsodirotbonk USD 2006 2,66,43,996 2,859 0 848

Tojsodirotbonk USD 2007 5,06,37,283 0 0 0



Page 67 of 87

Annex 3.

Financial Institutions, currently engaged in credit business in Uzbekistan. Chart below provides a



Financial Institution Name Currency

Fiscal Year


Number of active

borrowers Deposits

Number of

depositors

Al-Barot USD 2008 45,147 0 0 0

Al-Barot USD 2009 96,887 1,000 0 0

Al-Barot USD 2010 1,74,627 800 0 0

Al-Barot USD 2011 2,28,127 0 0 0

Almaz USD 2008 0 0 0 0

Almaz USD 2009 2,28,249 57 2,45,153 83

Almaz USD 2010 13,57,047 504 0 177

ASR USD 2005 2,97,158 499 0 224

ASR USD 2006 6,83,176 742 0 569

ASR USD 2007 15,31,933 930 12,68,834 1,236

ASR USD 2008 34,21,073 1,360 28,58,896 2,287

ASR USD 2009 58,16,511 3,052 44,53,033 2,862

ASR USD 2010 66,37,382 2,670 53,04,322 3,462

Barakat USD 2009 1,05,994 145 0 0

Barakat USD 2010 77,541 122 0 0

Barakat USD 2011 1,31,738 129 0 0

Barakat USD 2012 2,45,711 182 0 0

Barakot USD 2002 3,08,599 3,251 0 0

Barakot USD 2003 6,44,360 5,210 49,204 4,931

Barakot USD 2004 9,62,923 8,573 1,293 71

Barakot USD 2005 11,07,094 10,195 0 0

Barakot USD 2006 10,79,151 9,542 0 0

BV Finans Invest USD 2008 0 0 0 0

BV Finans Invest USD 2009 89,030 63 0 0

BV Finans Invest USD 2010 1,26,761 143 0 0

BV Finans Invest USD 2011 1,48,416 0 0 0

BWA Kashkadarya USD 2003 1,10,271 1,129 0 0




Daulet USD 2001 56,876 1,130 0 0

Daulet USD 2002 87,226 1,275 0 0

Daulet USD 2003 1,27,806 1,475 0 0

Daulet USD 2004 2,26,548 3,239 0 0

Daulet USD 2005 3,84,268 4,991 0 0

Daulet USD 2006 5,59,373 5,986 0 0


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Daulet USD 2007 6,510 227 0 0

Ehtirom Plus USD 2008 84,834 0 0 0

Ehtirom Plus USD 2009 1,50,382 566 0 0

Ehtirom Plus USD 2010 4,22,518 1,387 0 0

FINCA - UZB USD 2003 48,946 264 0 0

FINCA - UZB USD 2004 2,14,003 1,322 0 0

FINCA - UZB USD 2005 5,30,166 2,728 0 0

FINCA - UZB USD 2006 5,67,922 4,226 0 0

FVRM USD 2003 2,32,377 1,093 0 0

FVRM USD 2004 6,98,139 3,285 0 0

FVRM USD 2005 10,59,692 4,439 0 0

FVRM USD 2006 7,72,991 2,594 0 0

Garant-Invest USD 2006 0 0 0 0

Garant-Invest USD 2007 0 0 0 0

Garant-Invest USD 2008 92,597 248 0 0

Garant-Invest USD 2009 2,68,369 524 0 0



HamkorBank USD 2008 0 22,718 0 0

HamkorBank USD 2009 0 25,652 84,29,892 0

HamkorBank USD 2010 0 23,181 0 31,728

HamkorBank USD 2011 0 22,021 0 0

HamkorBank USD 2012 0 27,470 0 1,24,361

Hilola Invest USD 2007 0 0 0 0

Hilola Invest USD 2008 42,801 41 0 0



IMKON USD 2004 43,631 0 0 4

IMKON USD 2005 4,60,293 900 0 232

IMKON USD 2007 1,06,142 336 0 0

Imkon Express Invest USD 2008 2,33,474 0 0 0



Izzat Ravshan USD 2009 1,30,975 85 84,429 0

Izzat Ravshan USD 2010 4,24,302 127 2,27,815 87

Kafolatli Sarmoya USD 2007 0 0 0 0



Kafolatli Sarmoya USD 2010 1,17,816 105 0 0



Kapital Plus USD 2007 0 0 0 0

Kapital Plus USD 2008 5,15,788 1,693 0 0

Kapital Plus USD 2009 7,94,878 2,409 0 0

Kapital Plus USD 2010 9,68,990 1,871 0 0

Kapital Plus USD 2011 11,57,994 0 0 0

KKBWA USD 2003 56,705 1,905 0 0



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KKBWA USD 2004 2,00,873 2,507 0 0

KKBWA USD 2005 3,05,824 3,775 0 0

KKBWA USD 2006 2,25,499 3,750 0 0

Konstanta Kapital USD 2007 0 0 0 0

Konstanta Kapital USD 2008 46,390 101 0 0




MCO Zamon USD 2008 0 0 0 0

MCO Zamon USD 2009 23,562 88 0 0

MCO Zamon USD 2010 38,763 188 0 0

MCO Zamon USD 2011 58,074 241 0 0

Mikrokredit Bank USD 2006 0 22,807 0 28,304


Mikrokredit Bank USD 2008 0 60,515 0 1,69,863




Mikrokredit Bank USD 2012 0 0 0 0

Oltin Yulduz Plus USD 2007 0 0 0 0

Oltin Yulduz Plus USD 2008 55,102 226 0 0

Oltin Yulduz Plus USD 2009 0 1,141 0 0

Renesans USD 2007 0 0 0 0

Renesans USD 2008 3,09,872 0 0 0

Renesans USD 2009 4,43,680 1,019 0 0

Renesans USD 2010 5,06,760 1,018 0 0

Rivoj Invest USD 2007 3,83,972 221 0 68

Roshidon Imkon USD 2010 8,13,134 768 6,78,257 0

SABR USD 2002 16,641 348 0 0

SABR USD 2003 78,796 710 0 0

SABR USD 2004 1,03,592 660 0 0

SABR USD 2005 1,02,989 653 0 0

SABR USD 2006 57,429 140 0 0

SABR USD 2007 25,094 139 0 0

SABR USD 2008 1,17,262 536 0 0

SABR USD 2009 1,25,432 452 0 0

SABR USD 2010 1,45,053 487 0 0

SABR USD 2011 2,19,499 706 0 0

SABR USD 2012 1,58,235 483 0 0

Sarbon USD 2008 73,563 0 1,21,428 0

Sarbon USD 2009 5,56,203 200 5,21,833 97

Sarbon USD 2010 13,39,926 397 10,61,025 486

Sherdor USD 2008 11,45,300 0 9,93,170 0

Sherdor USD 2009 12,56,262 254 11,19,886 592

Sherdor USD 2010 16,94,511 278 13,84,386 1,050


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Tadbirkor Invest USD 2008 1,75,469 0 0 0

Tadbirkor Invest USD 2009 2,73,294 2,003 0 0



Tadbirkor Invest USD 2012 1,91,407 934 0 0

Trust Invest USD 2008 0 0 0 0

Trust Invest USD 2009 72,815 48 0 0

Trust Invest USD 2010 2,93,033 325 0 0

Umid USD 2007 10,63,270 0 9,92,993 0

Umid USD 2008 15,61,441 630 14,97,968 1,047

Yengil Kredit USD 2008 0 0 0 0

Yengil Kredit USD 2009 1,12,150 0 0 0

Yengil Kredit USD 2010 3,08,491 313 0 0



Page 71 of 87

Annex 4.

Financial Institutions, currently engaged in credit business in Pakistan. Chart below provides a clear

vision, on their gross loan portfolio, number of active borrowers, and total deposits. Figure in USD

million & business entities respectively. Figure 0, represents no data available.

Financial Institution Name Currency

Fiscal Year


Number of active

borrowers Deposits

Number of

depositors

Akhuwat USD 2003 85,052 0 0

Akhuwat USD 2004 3,04,844 3,023 0 0

Akhuwat USD 2005 6,37,195 6,069 0 0

Akhuwat USD 2006 8,41,921 8,734 0 0

Akhuwat USD 2007 0 0

Akhuwat USD 2008 11,86,606 15,013 0 0

Akhuwat USD 2009 17,52,586 20,158 0 0

Akhuwat USD 2010 28,41,499 31,543 0 0

Akhuwat USD 2011 80,59,842 63,085 0 0

Akhuwat USD 2013 2,20,09,004 2,14,550 0

AKRSP USD 1997 6,229 0 0

AKRSP USD 1998 5,043 35,911 0 0

AKRSP USD 1999 3,880 26,716 0 0

AKRSP USD 2000 2,441 21,717 0 0

AKRSP USD 2001 1,722 12,288 0 0

Apna Microfinance Bank (Formerly NMFB) USD 2005 6,50,049 2,211 60,117 3,344

Apna Microfinance Bank (Formerly NMFB) USD 2006 8,46,628 2,454 54,048 4,487

Apna Microfinance Bank (Formerly NMFB) USD 2007 7,44,378 2,303 3,75,123 5,451





ASA Pakistan USD 2008 1,37,967 1,195 0

ASA Pakistan USD 2009 14,25,359 18,283 0 0

ASA Pakistan USD 2010 85,98,579 85,380 0 0

ASA Pakistan USD 2011 1,51,18,942 1,42,814 0 0

ASA Pakistan USD 2012 1,54,39,597 1,47,437 0 0

ASA Pakistan USD 2014 2,44,15,074 1,88,313 0 0


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Asasah USD 2003 4,09,521 4,588 16,026 4,196

Asasah USD 2004 8,15,903 8,492 25,131 7,163

Asasah USD 2005 18,37,256 12,512 41,283 11,884

Asasah USD 2006 36,75,656 27,711 79,481 26,609

Asasah USD 2007 33,05,054 23,730 78,730 0

Asasah USD 2008 31,99,254 28,732 69,716 30,077

Asasah USD 2009 0 0 0 0

Asasah USD 2010 0 18,941 45,23,105 0

Asasah USD 2011 13,66,240 13,662 35,905 12,215

Asasah USD 2012 13,27,052 13,662 34,875 12,215

Asasah USD 2013 5,06,390 4,194 1,643 1,297

Bank of Khyber USD 2002 39,81,232 7,761 0 0




BRAC - PAK USD 2008 29,10,919 29,200 4,60,710 0

BRAC - PAK USD 2009 43,03,119 45,011 7,37,302 0

BRAC - PAK USD 2010 82,07,021 83,797 14,05,327 83,797

BRAC - PAK USD 2011 1,08,93,395 98,095 18,24,827 98,095

BRAC - PAK USD 2012 84,32,191 68,192 14,67,407 68,192

BRAC - PAK USD 2014 94,96,423 57,027 0 0

Buksh Foundation USD 2008 9,733 39 0 0



Buksh Foundation USD 2011 1,07,657 615 0 0

CSC USD 2005 10,43,105 5,808 0 0

CSC USD 2006 24,01,222 15,254 77,001 15,254

CSC USD 2007 22,44,349 0 0 0

CSC USD 2008 24,19,425 15,241 0 0

CSC USD 2009 19,91,431 11,975 0 0

CSC USD 2010 22,42,015 12,828 0 0

CSC USD 2011 22,01,138 13,822 0 0

CSC USD 2012 29,51,158 18,578 0 0

CSC USD 2013 38,37,458 19,657 0 0

CWCD USD 2007 17,22,195 0 0 0

CWCD USD 2008 14,77,271 6,193 0 0

CWCD USD 2009 18,33,251 8,910 0 0

CWCD USD 2010 15,36,412 12,897 0 0

CWCD USD 2011 13,90,904 7,257 0 0

CWCD USD 2014 13,84,853 5,280 0 0

DAMEN USD 2002 3,16,328 5,956 0 0

DAMEN USD 2003 5,94,557 10,140 0 0

DAMEN USD 2004 5,31,374 6,980 0 0

DAMEN USD 2005 15,56,614 15,568 0 0

DAMEN USD 2006 27,87,357 25,478 0 0

DAMEN USD 2007 40,65,393 32,623 0 0

DAMEN USD 2008 41,31,846 36,897 0 0



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DAMEN USD 2009 50,08,343 44,912 0 0

DAMEN USD 2010 43,08,699 38,145 0 0

DAMEN USD 2011 51,06,326 31,036 0 0

DAMEN USD 2012 68,29,246 35,065 0 0

DAMEN USD 2014 80,12,833 35,985 0 0

Farz Foundation USD 2008 0 0 0 0

Farz Foundation USD 2009 8,221 84 0 0

Farz Foundation USD 2010 13,641 0 0 0

FFO USD 2009 1,83,785 2,963 0 0

FFO USD 2010 5,61,600 5,598 0 0

FFO USD 2011 9,20,059 8,552 0 0

FFO USD 2012 12,60,258 10,753 0 0

FFO USD 2013 25,91,665 18,049 1,47,549 8,568

FMFB - Pakistan USD 2002 2,96,068 713 0 2,773

FMFB - Pakistan USD 2003 11,08,948 3,558 39,87,596 9,919

FMFB - Pakistan USD 2004 35,73,861 9,543 59,67,425 18,187

FMFB - Pakistan USD 2005 60,68,138 16,931 0 18,589

FMFB - Pakistan USD 2006 1,13,07,140 52,308 0 38,852

FMFB - Pakistan USD 2007 1,98,30,507 1,01,394 0 79,827

FMFB - Pakistan USD 2008 2,68,11,464 1,68,191 0 1,44,898






GBTI USD 2010 7,18,284 0 0 0

GBTI USD 2011 9,46,482 3,975 0 0

GBTI USD 2013 7,73,515 6,994 3,105 3,114

JWS USD 2008 12,73,594 0 0 0

JWS USD 2009 19,29,970 13,019 0 0

JWS USD 2010 24,45,272 14,020 0 0

JWS USD 2011 32,32,967 20,178 0 0

JWS USD 2013 42,77,179 25,729 0 0

Kashf Bank USD 2007 0 0 0

Kashf Bank USD 2008 70,16,887 18,221 0 0

Kashf Bank USD 2009 50,25,174 14,192 37,73,376 42,073

Kashf Bank USD 2010 52,93,246 17,445 90,70,106 78,476

Kashf Bank USD 2011 78,25,944 20,014 0 1,21,423

Kashf Bank USD 2012 1,18,46,400 24,401 0 1,80,266

Kashf Bank USD 2014 2,44,41,450 46,978 0 2,14,867

Kashf Foundation USD 2002 22,63,536 29,655 0 26,791

Kashf Foundation USD 2003 58,49,770 59,389 0 57,058

Kashf Foundation USD 2004 80,68,394 67,552 1,28,173 54,042

Kashf Foundation USD 2005 1,29,56,833 75,520 1,06,983 63,627

Kashf Foundation USD 2006 2,51,90,461 1,33,690 1,32,740 1,06,952


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Kashf Foundation USD 2007 5,16,03,641 2,95,396 2,06,155 2,66,896

Kashf Foundation USD 2008 4,42,30,466 3,13,512 2,04,193 0

Kashf Foundation USD 2008 68,90,838 0 44,173 0

Kashf Foundation USD 2009 1,72,26,943 3,17,299 0 0

Kashf Foundation USD 2010 2,46,12,129 2,24,140 63,941 0

Kashf Foundation USD 2012 3,56,27,499 3,12,182 62,252 81,448

Kashf Foundation USD 2013 3,81,61,656 3,24,139 0 0

Khushhali Bank USD 2003 1,19,24,316 91,532 0 0

Khushhali Bank USD 2004 2,35,42,172 1,68,105 0 0




Khushhali Bank USD 2008 3,92,80,453 3,12,851 2,30,711 0

Khushhali Bank USD 2009 4,30,11,904 3,29,421 22,51,571 74,995

Khushhali Bank USD 2010 4,34,83,093 3,25,523 0 2,05,962




NLCL USD 1997 40,69,887 1,295 0 0

NLCL USD 1998 50,22,632 1,501 0 0

NLCL USD 1999 68,18,651 2,789 0 0

NLCL USD 2000 71,96,899 3,038 0 0

NLCL USD 2001 86,35,255 3,768 0 0

NRSP USD 2002 1,05,40,722 70,375 0 0

NRSP USD 2003 1,42,97,666 88,401 0 23,995

NRSP USD 2004 2,06,53,666 1,26,034 0 0

NRSP USD 2005 3,31,70,935 1,90,846 0 0

NRSP USD 2006 5,36,18,494 2,92,456 0 0

NRSP USD 2007 0 5,65,863 0 0

NRSP USD 2008 5,64,86,713 3,99,969 0 0

NRSP USD 2009 6,58,62,911 4,31,027 0 0

NRSP USD 2010 4,25,57,829 3,17,381 0 0

NRSP USD 2011 4,70,66,327 3,45,295 0 0

NRSP USD 2012 5,61,52,887 3,90,995 0 0

NRSP USD 2013 7,12,31,908 4,73,966 0 23,94,74

7

NRSP Bank USD 2010 0 0 0 0

NRSP Bank USD 2011 2,32,23,470 1,01,870 70,32,185 14,683

NRSP Bank USD 2012 3,14,87,252 1,27,005 0 80,612

NRSP Bank USD 2014 6,54,43,604 2,24,835 0 1,24,678

Orangi USD 2002 5,82,148 2,481 0 0

Orangi USD 2003 7,77,218 3,895 0 0

Orangi USD 2004 10,73,190 6,986 0 0

Orangi USD 2005 15,94,106 12,002 0 0

Orangi USD 2006 23,76,424 20,987 0 0

Orangi USD 2007 28,31,639 23,896 0 0

Orangi USD 2008 42,79,473 34,874 0 0



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Orangi USD 2009 59,01,352 49,155 0 0

Orangi USD 2010 51,42,567 41,005 0 0

Orangi USD 2011 49,78,751 0 0 0

Orangi USD 2012 51,06,787 42,224 0 0

Orangi USD 2013 57,29,823 46,275 0 0

Orix Leasing USD 2003 8,62,437 2,280 0 0

Orix Leasing USD 2004 12,55,572 4,013 0 0

Orix Leasing USD 2005 12,27,588 3,630 0 0

Orix Leasing USD 2006 21,00,330 8,900 0 0

Orix Leasing USD 2007 22,90,995 15,177 0 0

Orix Leasing USD 2008 23,97,887 16,326 0 0

Orix Leasing USD 2009 24,86,131 15,553 0 0

Orix Leasing USD 2010 23,00,178 18,125 0 0

Orix Leasing USD 2011 20,18,466 16,231 0 0

Orix Leasing USD 2012 23,50,078 16,322 0 0

Orix Leasing USD 2013 28,67,841 19,553 0 0

POMFB USD 2006 14,03,978 10,418 0 0

POMFB USD 2007 64,56,263 14,397 3,76,447 14,397

POMFB USD 2008 15,90,360 10,853 3,02,968 16,859

POMFB USD 2009 11,91,595 8,092 2,90,843 15,971

POMFB USD 2010 10,32,103 7,045 3,23,882 17,082

POMFB USD 2011 11,25,411 6,569 2,81,730 18,701

POMFB USD 2012 12,25,094 6,127 2,75,580 16,020

POMFB USD 2014 12,37,114 4,553 3,04,997 19,236

PRSP USD 2002 68,02,376 60,464 0 0

PRSP USD 2003 60,57,096 54,555 0 2,24,543

PRSP USD 2004 47,22,403 47,855 0 0

PRSP USD 2005 43,32,601 41,860 0 2,70,000

PRSP USD 2006 70,65,567 67,285 0 0

PRSP USD 2007 95,68,557 74,172 0 0

PRSP USD 2008 94,47,825 81,754 0 0

PRSP USD 2009 77,39,894 78,091 0 0

PRSP USD 2010 69,69,248 57,200 0 0

PRSP USD 2011 82,62,063 63,323 0 0

PRSP USD 2013 1,10,52,931 74,382 20,92,454 2,05,117

RCDS USD 2004 0 0 0

RCDS USD 2005 5,93,535 0 0 0

RCDS USD 2006 7,89,995 0 0 0

RCDS USD 2007 12,47,393 0 0 0

RCDS USD 2008 15,32,664 0 0 0

RCDS USD 2009 22,66,697 19,240 0 0

RCDS USD 2010 22,61,566 0 0 0

RCDS USD 2010 30,42,724 19,388 0 0

RCDS USD 2011 35,59,483 23,951 0 0

RCDS USD 2013 54,24,307 37,166 0 0


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Rozgar USD 2005 3,28,300 1,777 2,99,269 1,204

Rozgar USD 2006 6,66,501 4,363 2,56,564 2,778

Rozgar USD 2007 5,45,944 2,337 4,96,268 4,224

Rozgar USD 2008 3,58,544 1,601 3,07,047 4,849

Rozgar USD 2009 86,367 613 3,86,312 5,027

Rozgar USD 2009 10,469 52 3,65,384 5,178

Rozgar USD 2012 7,847 0 57,302 0

Rozgar USD 2013 3,92,236 1,220 19,44,817 20,502

SAFWCO USD 2002 1,19,262 2,027 0 0

SAFWCO USD 2003 1,92,702 2,973 0 0

SAFWCO USD 2004 2,83,288 3,569 0 0

SAFWCO USD 2005 7,22,615 8,965 0 0

SAFWCO USD 2006 18,54,756 17,529 0 0

SAFWCO USD 2007 20,72,934 18,043 0 0

SAFWCO USD 2008 26,13,898 23,430 0 0

SAFWCO USD 2009 27,02,345 23,123 0 0

SAFWCO USD 2010 36,35,078 30,856 0 0

SAFWCO USD 2011 36,51,674 32,599 0 0

SAFWCO USD 2012 41,61,636 38,762 0 0

SAFWCO USD 2013 39,61,667 37,221 0 0

Save the Poor USD 2003 337 400 0 1,560

Save the Poor USD 2004 573 1,000 0 3,710

Save the Poor USD 2005 1,004 2,000 0 4,650

SRSO USD 2009 44,27,092 31,250 0 0

SRSO USD 2010 69,65,510 44,268 0 0

SRSO USD 2011 1,00,28,285 63,063 0 0

SRSO USD 2012 1,08,39,343 66,315 0 0

SRSO USD 2013 78,85,602 49,437 29,144 19,099

SRSP USD 2002 7,29,071 6,389 0 0

SRSP USD 2003 5,04,849 5,077 0 1,62,453

SRSP USD 2004 4,64,304 6,703 0 1,79,078

SRSP USD 2006 7,09,193 7,174 0 0

SRSP USD 2007 10,53,500 10,847 0 0

SRSP USD 2008 3,98,368 7,218 0 0

SRSP USD 2009 98,435 1,121 0 0

SRSP USD 2010 1,72,193 2,153 0 0

SRSP USD 2011 2,42,670 3,179 0 0

SRSP USD 2012 3,23,715 3,838 0 0

SRSP USD 2013 3,37,177 4,289 46,887 7,289

Sungi USD 2003 72,697 1,033 0 0

Sungi USD 2004 81,257 725 0 17,845

Sungi USD 2005 1,00,479 852 0 0

Sungi USD 2008 1,11,115 1,039 0 0

Sungi USD 2009 2,52,761 3,653 0 0

Sungi USD 2010 4,31,768 5,512 0 0

Sungi USD 2014 9,52,009 10,714 0 0

Taraqee USD 2002 11,85,849 10,078 0 0



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Taraqee USD 2003 25,92,983 18,194 67,320 22,281

Taraqee USD 2004 47,26,233 25,217 1,59,153 28,994

Taraqee USD 2005 16,23,518 12,203 2,16,539 27,088

TMFB USD 2006 86,60,033 20,038 61,75,654 24,434

TMFB USD 2007 66,36,477 31,011 50,01,981 44,507

TMFB USD 2008 1,15,15,581 43,791 81,20,952 0

TMFB USD 2009 1,82,44,562 70,671 0 1,22,538

TMFB USD 2010 3,61,68,738 1,11,153 0 2,28,634

TMFB USD 2011 5,63,69,339 1,32,728 0 6,41,386

TMFB USD 2012 6,88,82,800 1,54,973 0 9,23,963

TMFB USD 2014 8,82,58,374 2,08,080 0 13,37,95

4

TRDP USD 2001 4,62,583 4,042 0 0

TRDP USD 2002 6,39,647 5,488 0 0

TRDP USD 2003 12,67,604 8,421 0 66,633

TRDP USD 2004 48,57,958 32,549 0 1,34,058

TRDP USD 2005 56,48,947 42,932 0 0

TRDP USD 2006 56,49,762 37,264 0 0

TRDP USD 2007 57,56,071 30,751 0 0

TRDP USD 2008 36,03,963 27,010 0 0

TRDP USD 2009 33,26,817 31,647 0 0

TRDP USD 2010 45,49,398 41,645 0 0

TRDP USD 2011 57,94,029 55,404 0 0

TRDP USD 2013 1,17,11,620 1,00,604 23,18,490 4,36,168


Page 78 of 87

Annex 5.

AIB – Survey Questionnaire

1. What major programs and or projects AIB has put in place in regards to access to finance for SMEs?

2. What are the main activities of AIB in relation to SME’s in Afghanistan?

3. Within the rural, sectors what criteria determine your decision to disburse funds? Among other

things, do you consider the size (number of employees and existing physical assets) of the firm as

one of the determining factors? Please specify the Process of loan disbursement.

4. Under what terms and conditions your program makes finance available to SME’s intending to

target their products to the export market?

5. Apart from the rural sector what other sectors have you targeted?

6. Over the past few years how has your financing approach changed? Has its availability and reach

expanded, remained unchanged or reduced?

7. Number of loan applications yearly since AIB’s establishment? Please also specify the amount USD

yearly applied for.

8. Amount of USD disbursed yearly since AIB’s establishment

9. Is there any statistical review or a periodic report to highlight the achievements, problems and

challenges faced by rural enterprises across the country? If not please do not hesitate writing the

challenges, opportunities and recommendations of financial institutions regarding access to finance

for SMEs in Afghanistan (AIB in particular).



Page 79 of 87

Annex 6.

Survey Questionnaires for Export Promotion, Access to finance &

Formalization:

1- Export Promotion Potential Survey Questionnaire;

وزارت تجارت و صنایع جمهوری اسالمی افغانستان سازمان همکاری اسالمی

عنوان: پرسشنامه

ظرفیت صادرات، دسترسی به منابع مالی و رسمی سازی متشبثین کوچک و متوسط افغانستان توسعهع: موضو

محترما !

ی ریاست های مجترم پالیسی و پالن و تنظیم و انکشاف متشبثین کوچک و متوسط وزارت تجارت و صنایع جمهوری اسالمی افغانستان با همکاری مال

ظرفیت صادرات، دسترسی به منابع مالی و رسمی سازی متشبثین کوچک و توسعه هدف آن بررسیسازمان همکاری اسالمی یک سروی تحقیقی که

متوسط افغانستان میباشد به راه انداخته است.

. ن سازیدبناً از شما احترامانه تقاضا به عمل می آوریم تا سُواالتی که در این پرسشنامه گنجانیده شده اند با دقت کامل جواب ارائه نموده ممنو

قابل یاد آوریست معلومات که شما دراین پرسشنامه ارائه میدارید فقط و فقط جهت اکمال این تحقیق استفاده میشود.

اسم و معلومات شخصی شما همه نزد ما محفوظ و محرم خواهند بود.

و در نمیشودپرسشنامه هذا دارای دو بخش بوده که بخش اول آن شامل معلومات شخصی َشما بوده که به هیچ صورت با کسی شریک -

.به عمل نمی آیدذکر به هیچ وجه راپور نهائی از آن

ه میدارید. سواالت چهار جواب درست ارائ ،که شما به سواالت میباشدسواالت این تحقیق در موارد خاص شاملبخش دوم این پرسشنامه -

جوابه و یا هم )بلی و نخیر( جهت سهولت به شما ترتیب شده اند.

. بنویسید√ ( در مقابل جواب دلخواه تان فقط یک ) -

بااحترام

محمد صابر "صدیقی" محمد طارق "نعیم"


Page 80 of 87

همکار تخنیکی و کارشناس تحقیق همکار تخنیکی و کارشناس تحقیق

SPPD/SMED-MoCI SPPD/SMED-MoCI

:بخش اول

معلومات شخصی

بخش دوم:

تولیدات ساالنه شرکت شما چی قدر است؟ (1)

افعانی

فروشات داخلی شرکت تان چه قدر است؟ (2)

افغانی

تولیدات تان را به خارج از کشور هم صادر میکنید؟ (1)

نخیر بلی

تعداد پرسونل/کارمندان شرکت به چند تن/فرد میرسد؟ تعداد مرد و زن؟ درجه تحصیلی آنها به چه سطح است؟ (2)

آیا شرکت، پالن بازاریابی داخلی و خارجی دارد؟ (3)

اگر بلی، نکات عمده این پالن در قسمت صادرات به خارج چی ا ست؟ (4)

آیا مدیریت و یا ریاست تحت عنوان "بازاریابی" دارید؟ اگر بلی، تعداد افراد و درجه تحصیلی آنها را تذکر دهید؟ (5)

به کدام کشور های زیر صادرات دارید؟ (6)

پاکستان

ایران

امارات متحده عربی

ترکیه

ازبکستان

قزاقستان

تاجیکستان

روسیه

همه اینها

اسم

فهوظی والیت

سکتور نوع

Survey ID Number

Date of Interview

Time of Interview



Page 81 of 87

این تولیدات شما را کی صادر میکند؟ (7)

شخص سوم خود مان

مشکل اساسی در توسعه صادرات شما چی است؟ (8)

از قبیل دخالت های دولت

نداشتن یک براند، ظرفیت پاین تولیدی

، کیفیت پاین تولیدات

چی چیزی روی کیفیت تولید تاسیر

دارد اف: ب: ج:

موانع از طرف کشور وارد کننده ) تعرفه ای وارداتی(

مشکالت برای دسترسی به قرضه

برای صادرات

نداشتن راه های مواصالتی

همه اینها

خارجی صادر نمیکنید؟ چرا تولیدات خود را در مارکیت های (9)

ستندرد نبودن تولید

نداشتن سرتفیکیت های بین المللی

ضرورت ندارم

همه اینها


Page 82 of 87

2- Survey Questionnaire, Access to Finance;



ظرفیت صادرات، دسترسی به منابع مالی و رسمی سازی متشبثین کوچک و متوسط افغانستان توسعهوع: ضمو

محترما !

ی ریاست های مجترم پالیسی و پالن و تنظیم و انکشاف متشبثین کوچک و متوسط وزارت تجارت و صنایع جمهوری اسالمی افغانستان با همکاری مال

هدف آن بررسی ترقی ظرفیت صادرات، دسترسی به منابع مالی و رسمی سازی متشبثین کوچک و سازمان همکاری اسالمی یک سروی تحقیقی که


ن سازید.بناً از شما احترامانه تقاضا به عمل می آوریم تا سُواالتی که در این پرسشنامه گنجانیده شده اند با دقت کامل جواب ارائه نموده ممنو

معلومات که شما دراین پرسشنامه ارائه میدارید فقط و فقط جهت اکمال این تحقیق استفاده میشود. ،قابل یاد آوریست

اسم و معلومات شخصی شما همه نزد ما محفوظ و محرم خواهند بود.

با کسی شریک نشده و در پرسشنامه هذا دارای دو بخش بوده که بخش اول آن شامل معلومات شخصی َشما بوده که به هیچ صورت -

.به عمل نمی آید از آن ذکر به هیچ وجه راپور نهائی

جواب درست ارائه میدارید. ،بخش دوم این پرسشنامه شمامل محتوا یا سواالت این تحقیق در موارد خاص بوده که شما به سواالت -

رتیب شده اند. و یا هم )بلی و نخیر( جهت سهولت به شما ت ، چندین جوابهجوابه سواالت چهار

( بنویسید √در مقابل جواب دلخواه تان فقط یک ) -

بااحترام


همکار تخنیکی و کارشناس تحقیق همکار تخنیکی و کارشناس تحقیق




Page 83 of 87

بخش اول:


بخش دوم:

چیست؟ شما شرکت منابع مالیدر صورت ضرورت (1)

بانک ها

موسسه های مالی

شرکت های سهامی

پول شخصی

هیچکدام

کدام منابع تمویل می گردد؟داد و ستد روزمرهء کارخانه و یا شرکت شما از (2)

بودجه شخصی

پول قرضه

مفاد خالص شرکت

از همه اینها

از پول قرضه ایکه به شما داده شد، کدام یکی از دارائی های زیر را خریداری نمودید؟ (3)

ماشین آالت برای شرکت

موتر برای شرکت

زمین برای شرکت

هیچکدام

تاسیسات مالی زیر مفید است؟گرفتن قرضه از کدام یکی از (4)

بانک های دولتی

بانک های تجارتی

تاسیسات مالی غیر رسمی

نمیدانم

دلیل عمدهء که شما به گرفتن قرضه اقدام نمی کنید چیست؟ (5)

حرام بودن سود

نرخ بند سود

فساد اداری

همهء اینها

اسم

وظیفه والیت

نوع سکتور

Survey ID Number

Date of Interview

Time of Interview


Page 84 of 87

3- Survey Questionnaire, Formalization;



ظرفیت صادرات، دسترسی به منابع مالی و رسمی سازی متشبثین کوچک و متوسط افغانستان توسعهوع: ضمو

محترما !

متشبثین کوچک و متوسط وزارت تجارت و صنایع جمهوری اسالمی افغانستان با همکاری مالی ریاست های مجترم پالیسی و پالن و تنظیم و انکشاف

ظرفیت صادرات، دسترسی به منابع مالی و رسمی سازی متشبثین کوچک و توسعه سازمان همکاری اسالمی یک سروی تحقیقی که هدف آن بررسی


حترامانه تقاضا به عمل می آوریم تا سُواالتی که در این پرسشنامه گنجانیده شده اند با دقت کامل جواب ارائه نموده ممنون سازید. بناً از شما ا

قابل یاد آوریست معلومات که شما دراین پرسشنامه ارائه میدارید فقط و فقط جهت اکمال این تحقیق استفاده میشود.

زد ما محفوظ و محرم خواهند بود.اسم و معلومات شخصی شما همه ن

پرسشنامه هذا دارای دو بخش بوده که بخش اول آن شامل معلومات شخصی َشما بوده که به هیچ صورت با کسی شریک نشده و در -

.به عمل نمی آیدذکر به هیچ وجه راپور نهائی از آن

جواب درست ارائه میدارید. ،بوده که شما به سواالتبخش دوم این پرسشنامه شمامل محتوا یا سواالت این تحقیق در موارد خاص -

و یا هم )بلی و نخیر( جهت سهولت به شما ترتیب شده اند. ، چندین جوابهسواالت چهار جوابه

بنویسید√ ( در مقابل جواب دلخواه تان فقط یک ) -

بااحترام


همکار تخنیکی و کارشناس تحقیق کارشناس تحقیق همکار تخنیکی و



Page 85 of 87


بخش اول:


بخش دوم:

راجستر است؟آیا کار و بار شما در کدام مرجع رسمی (1)

نخیر بلی

شرکت تان را چه وقت راجستر ساختید؟ (2)

در آغاز کار شرکت

بعد از آغاز کار شرکت

قبل از آغاز کار شرکت

تا حال راجستر نمی باشد

چه باعث شد تا شرکت تان را راجستر ساختید؟ (3)

قانون

تشویق دولت

اعتماد به دولت

نمیدانم

راجستر نمی سازید؟چرا شرکت تان را (4)

طی مراحل پیچیده

فساد اداری

نبودن یک مرجع مشخص

همه اینها

شرکت تان در کدام یکی از مراجع زیر راجستر است؟ (5)

آیسا )ادره حمایت از سرمایه گزاری(

شاروالی

وزارت تجارت

اسم

وظیفه والیت

نوع سکتور

Survey ID Number

Date of Interview

Time of Interview


Page 86 of 87

همه اینها

آیا جواز های که از مراجع مختلف صادر میشوند فرق دارند؟ (6)

نخیر بلی

تشکر!



Page 87 of 87

List of References:

1- Afghanistan Statistical Year Book, Central Statistical Organization-Afghanistan. 2003-2013

Kabul. 2- Policy Hand Book, Private Sector Development Report; OECD 2013. 3- Afghanistan Economic Update, World Bank Report, 2010. 4- Credit Reporting Regulation, Da Afghanistan Bank, 2010. 5- Afghanistan Banking Association Newsletter, Afghanistan Banking Association, 2013. 6- Doing Business 2013, World Bank & International Financial Cooperation, 2013. 7- Doing Business 2014, World Bank & International Financial Cooperation, 2014. 8- Strategy for Turkmenistan, European Bank for Reconstruction & Development, 2010. 9- Access to Finance in Afghanistan, Afghanistan Investment Support Agency, 2012. 10- Afghanistan Banking Association Newsletter, Afghanistan Banking Association, 2014. 11- Access to Finance and credit Conference Report, MISFA, 2012. 12- Best Practice on Export Promotion, A Technical report, NATHAN Associates Inc. 2004. 13- Stories of Impact-Small & Medium Enterprises South Asia Report, International Finance

Corporation, 2011. 14- Small to Medium Enterprise Paper, Fourth Regional Economic Cooperation Conference on

Afghanistan Report, November 2010-Istanbul. 15- Turkmenistan Project Report, UNDP, 2010-2015. 16- Strategic Plan 2009-2014, Da Afghanistan Bank, 2009. 17- Tajikistan Partnership Program, the World Bank Group, 2014. 18- Afghanistan & Regional Trade, University of Central Asia, 2012. 19- A Guide to Government in Afghanistan, AREU & World Bank. (Websites) 20- Export Promotion in Developing Countries, JICA’s Experience, a Country Report, 2012. 21- THE SOCIAL IMPACT OF IMPROVED MARKET ACCESS AND EXPORT PROMOTION IN

AGRICULTURE, Edward Anderson, Fransisco Ayala and Kate Bird, odi-London, 2005. 22- Promoting SMEs for Development, Organization for Economic Co-operation and Development,

2004, Turkey-Istanbul. 23- Small and Medium Enterprises and Employment Generation in Nigeria-A Case Study, Dr. Ismaila

Bolarinwa Kadiri, Department of Business Administration of Ilorin, Nigeria, 2012. 24- Small & Medium Enterprises Action Plan, Ministry Of Commerce and Industries, Islamic republic

of Afghanistan, 2009. 25- Agriculture Market Research for Microfinance and SME interventions, Mennonite Economic

Development Associates, 2009. 26- SME, Past, Present and Future-A Country Report, Mennonite Economic Development Associates,

2010.

Documents

Small \u0026 Medium Enterprises Export Promotion Potential, Access to Finance and Formalization in Afghanistan