Taliban Afghanistan
Will global businesses be tempted to be part of extracting Afghanistan's untold natural resources? Image Credit: AP

Major events are more often than not accompanied by wild speculations and exaggerated forecasts. While these do add excitement to what’s happening, they tend to obscure more important issues or only justify a specific course of action.

The developments in Afghanistan and the humiliating withdrawal of US forces has become the talk of the world. Social media chatter has responded with extreme flights of fancy about the size of the natural resources wealth in Afghanistan. It did not take long for them to conclude that there will be a conflict, especially between the US and China, over Afghan minerals.

They specifically refer to copper and lithium, which are vital for tech industries and electric vehicle batteries. Demand for copper and lithium is constantly on the rise with the expansion of clean energy plants, as well as the rapid spread of electric cars.

The World Bank expects that demand for lithium will double five times within the next 30 years. However, the exaggerated assessment of Afghanistan's resources of these two minerals among others is completely on the wrong track.

Yet, the talk was such that without Afghan minerals, there would be no technological progress or clean energy! This conveniently ignores the fact that progress in renewable energy in these past two decades developed without the need for Afghan minerals.

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Not one to fight over

It is true that Afghanistan contains great natural resources, estimated by some to be $1 trillion. Some American experts reckon the value to be $3 trillion, keeping in mind that the US has spent around $2 trillion on its 20-year war in Afghanistan.

Let’s assume that such estimates are true, but they cannot play a decisive role in any future conflict for the many reasons including, there are other countries and regions in the world with quantities of copper, lithium, silver, zinc and other minerals exceeding Afghanistan’s.

Chile, for example, is the largest copper-producing country in the world, followed by China, Peru, the US and Congo. As for lithium, Mexico is the top producing country, followed by China and Australia. This mineral is abundantly available in Canada, Congo and Russia.

In the Arab world, Sudan has one of the largest copper mines in the world, as well as important reserves in Oman. These facts do not negate the importance of Afghanistan's natural resources, but they place them in the right position without exaggerations and media sensationalism. Afghanistan's natural resources are complementary to the wealth of other countries.

No copper rush

We do not believe that international companies will rush to invest in the extraction of minerals in Afghanistan, due to the chaotic nature of the Taliban regime on the one hand, as well as the complete absence of regulations that protect foreign investments.

There are better alternatives in many regions of the world. The US knows this, which justifies its costly exit from a country where a lot of instability awaits new foreign investments.

As for the Chinese competition, what basically matters to China is not the minerals, but the importance of Afghanistan as an important logistical passage for its ‘Belt and Road’ project, through which it will connect East with the West.

Even in this case, other alternatives are still available to China in countries neighboring Afghanistan, such as Tajikistan and Turkmenistan. The question arises then why have all these exaggerations about Afghanistan’s wealth? Clearly, these have nothing to do with the country’s economy or supposed wealth.