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Afghanistan Marble and Granite survey by USAID

 

Contrary to the statement made by Arnold Fields, the Special Inspector General for Afghanistan Reconstruction, to Congress, that Afghanistan has “no substantial natural resources.” Mining in Afghanistan has dated back for over 6,000 years and with proper management can continue for many generations to come. Afghanistan has abundant mineral resources, but they have not been successfully developed during the 20th century.

A recent study by USAID, OTF Group, a competitiveness consulting firm that specializes in helping to build prosperity in developing economies, and Commercial Competitiveness Commission of Afghanistan found that the dimension stone industry has great potential to become one of the leading industries in the Afghan economy. There is also compelling information that was done in 2007 by USGS http://pubs.usgs.gov/of/2007/1214/ that confirms this.

Difficulties begin at the quarry where black powder is used in blasting, which damages the rock by causing it to micro fracture resulting in material being wasted. Some dimension stone deposits have been effectively ruined by fracturing resulting from overuse of explosives. Blasting produces small (8 to 10 metric tons) irregular pieces; over 50 percent of which is wasted in processing.

At the present time numerous changes have taken place in the Afghanistan Marble Industry, but they still have a major challenge ahead of them. With the help of USAID and Afghanistan Small & Medium Enterprise Development (ASMED), some new investments have been made in upgrading the extraction of marble.

Afghanistan currently has two quarries that we are aware of using high tech equipment. Equity Capital Mining Co, and the Mir Brothers. Our understanding is that both companies are producing blocks and exporting to Turkmenistan, Dubai and also selling to the local market. The future is to build modern processing plants for all the varieties of marble, onyx and granite. Currently the Afghan White is the most used marble in the industry, very similar to the Carrere Marble from Italy, but there are also over 40 different types in Afghanistan.

AMGPA(Afghanistan marbles processor association )

The Afghanistan Marble and Granite Processor Association was formed in 2006 and have a little over 100 members. AMPGA is facing a critical junction at this time. The need to strengthen the association is critical in order for the Marble Industry in Afghanistan to grow. Consultant Bob Step and I feel the association needs to have a short and long term strategic plan in place that will help the members in specific areas of the industry.

Many of the problems in the industry start with Afghanistan’s mining laws. http://www.bgs.ac.uk/afghanminerals/docs/Minerals_law.pdf The initial start up cost is extremely high and severely limits the number of quarry investors. The tax revenue could be recovered at the export level after the VAT. The Mineral Laws of Afghanistan has a provision in article 89, that gives the Ministry of Finance, for the purpose of private investment, the right to defer, reduce, and deduct all or a portion of Mineral Royalties payable. This article also gives them rights to reduce taxes in other areas such as, value-added, assets and custom charges.



A two year tax break for companies that are willing to open new quarries with high tech equipment would serve a number of purposes. One would be to bring in new investors, build a market for high quality blocks for export and local use, encourage new and existing marble producers to expand and look for export markets, and the creation of many jobs on all levels. The tax revenue could be recovered at the export level after the VAT.

Recommendations:

ASMED(Afghanistan Small and Medium Enterprises Development) should work with AMPGA(Afghanistan Marble and Granite Processor Association) , Ministry of Finance, and the Ministry of Mines, to help reduce some of the taxes, that would go a long way in helping the private sector to get a foothold in the Afghanistan Marble Industry. This is just one of problems we hear from quarry owners and producers. The

fees and taxes are two to four times the normal rates than in their countries. and provide for them land in industrial park to start their operation in peace full environment to provide for them national and international customer .

Marble companies:

Many of the marble companies we have visited on our last two trips, have been small processing plants with limited production capabilities. At the processing plant, lack of adequate equipment and processing techniques applied to stone that was previously damaged leading to more inefficiency. It appears that many of the plant owners are forced to supplement their business by importing marble products from neighboring countries and selling on the local market.

Sahel Marble Company: On our last visit to Sahel Marble Co. we reported that they had a working quarry, but were blasting at the time. They were also installing new processing equipment and hoped to find funding for a quarry wire saw operation at the mine. sail Marble Co could become a major marble processing/quarry operation in the eastern region. It is our understanding that part of the grants they have received included an agreement that they would also supply raw Marble/Granite block to other local processing plants in Jalalabad. Not only will this help Sahel develop, this could also be a stepping-stone for other processing plants. The need for high quality marble blocks is the basic foundation needed to manufacture products for local use and export to other countries. Update: After returning to Sahel Marble Co, we were encouraged by the continuing progress that they are making to have a modern processing facility in place in Jalalabad. They also must have acquired additional funding for their quarry operation at Khogyani district, about 50km away from their processing plant. We were there last February when they were in the process of building the foundation for the overhead crane. The crane is now installed and waiting for finishing touches. They are also in the process of installing a Gang Saw to produce large slabs and a slab cutter. This type of equipment is a major step forward to improving the overall quality of the finished products. In addition to their major improvements at the processing plants, they have received their first shipment of quarry processing equipment that includes the following:

I. Diamond wire saw

II. Manual diamond wire saw

III. Two drill stands

IV. Nomadic drills

V. Hydraulic jack units

VI. This equipment will greatly improve their capability of producing quality marble blocks and reduce if not eliminate blasting.

 


Date: 2015-01-29; view: 720


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