Troilus Gold brings potential funding from ECAs to $1.3 billion
The company has signed an additional LOI with Export Development Canada worth $300 million.
Afghanistan’s Taliban has signed seven mining contracts that would bring roughly $6.5 billion in investments to the ruling government, the Associated Press reported on Thursday. This figure, AP says, represents the biggest round of deals made by Taliban since seizing power two years ago.
According to AP, the contracts are with locally based companies, many of whom have foreign partners in countries including China, Iran and Turkey. They include the extraction and processing of iron ore, lead, zinc, gold and copper in four provinces: Herat, Ghor, Logar and Takhar.
A separate report by Voice of America showed that a televised signing ceremony took place on Thursday, featuring Taliban’s minister of mines and petroleum Shahabuddin Dilawar and certain Chinese investors.
In an official statement, Dilawar said that the agreement with a Chinese company for gold extraction in Takhar would bring the Taliban government a 65% share of the earnings over five years.
He added that other contracts involving Turkish, Iranian and British investments related to mining and processing iron ore in Herat would earn the government a 13% share over 30 years. “It will eventually turn Afghanistan into an exporter of iron,” he said.
No further details were given by the Taliban on the contracts, only that “they would create thousands of jobs and significantly improve the economic situation of the country” and result in over $6.5 billion in foreign investments.
However, “any figures given for the deals could be misleading unless they lead to fully realized mining operations on the ground, which could take years,” Javed Noorani, an expert in Afghanistan’s mining sector, told the Associated Press.
Since reclaiming power in August 2021, the Taliban has been courting foreign investment to revitalize Afghanistan’s economy, leveraging the nation’s vast amount of mineral resources that remain largely untapped to date.
“The Taliban know Afghanistan has minerals and this is cash, but it’s not easy cash,” Noorani told AP. “Mineral mining is an incredibly complicated operation. It requires a proper framework, strategies, institutions and infrastructure. You open up the sector slowly and start with low-hanging fruit.”
Tamim Asey, a former official with the Afghan ministry of mines and petroleum, is more skeptical of the Taliban’s new dealings, calling the announcement “mere propaganda.”
“The Afghan financial and banking sector is almost paralyzed and dysfunctional. Hence, no financial transactions or valuations,” he wrote in a thread on X (Twitter).
“The legal-policy framework for the mining sector is not only vague but almost nonexistent. The regime doesn’t even have a constitution, let alone mining legal framework.”
Read More: How Afghanistan’s $1 trillion mining wealth sold the war
