Ministry of Commerce and Industries
And
Ministry of Mines and Petroleum
Implementing the SME Strategy:
An Updated Action Plan for
Developing Afghanistan’s Marble
Sector
October 2013- September 2016
Table of Contents
................................................................................................................................................................ 1
List of Acronyms .................................................................................................................................... 3
Executive Summary ................................................................................................................................ 4
Action plan objectives......................................................................................................................... 4
Recent developments and current status of the sector ............................................................................ 4
Priority problems and constraints ........................................................................................................... 5
Overview and Current Status of the marble sector ................................................................................. 5
Nature, scope and importance of the marble sector ............................................................................ 5
Table 1: Estimated marble reserves in Afghanistan ............................................................................ 6
Table 2: Number of marble and granite reserves per province ........................................................... 6
Extraction, Procession and retail price of Afghan Marble per Ton USD, 2014 AMA: ...................... 7
Royalty Rate Comparison: .................................................................................................................... 11
Principal markets .................................................................................................................................. 11
The Marble Sector Value Chain............................................................................................................ 11
Structure and performance ................................................................................................................ 12
SWOT analysis - Strengths and weaknesses or gaps in the marble sector value chain ....................... 13
Investment needs and opportunities ...................................................................................................... 13
Strategy and priorities for improving competitiveness ......................................................................... 14
Specific development priorities and actions ..................................................................................... 14
Stakeholder roles and sources of assistance .......................................................................................... 15
Recommendations for action plan implementation............................................................................... 17
Summary of priority problems and actions ........................................................................................... 18
2
List of Acronyms
ABADE
Assistance in Building Afghanistan by Developing Enterprises
ACCI
Afghanistan Chamber of Commerce and Industries
AISA
Afghanistan Investment Support Agency
AGF
Afghanistan Growth Finance
ANSA
Afghanistan National Standards Authority
AMIA
Afghanistan Marble Industries Association
AMGPA
Afghanistan Marble and Granite Processing Association
ASTM
American Society for Testing and Materials
COE
Center of Excellence - Marmaristan
CSO
Central Statistics Office
EPAA
Export Promotion Agency of Afghanistan
GoIRA
Government of the Islamic Republic of Afghanistan
IFC
International Finance Corporation
MAIL
Ministry of Agriculture, Irrigation and Livestock
MIDAS
Mining Investment and Development for Afghan Sustainability
MOF
Ministry of Finance
MOCI
Ministry of Commerce and Industries
MOEW
Ministry of Energy and Water
MOMP
Ministry of Mines and Petroleum
MOTCA
Ministry of Transport and Civil Aviation
NEPA
National Environment Protection Agency
OPIC
Overseas Private Investment Corporation
NRRCP
National and Regional Resource Corridors Program
USAID
United States Agency for International Development
USGS
United States Geological Survey
WB
World Bank
This action plan was prepared with the support of the American people through the United States
Agency for International Development (USAID). The contents of this action plan do not necessarily
reflect the views of USAID or the United States Government.
3
Executive Summary
Action plan objectives
The purpose of this action plan is to address the principal problems which still hinder the growth
potential of Afghanistan’s marble sector and to review the status of previously identified action
plan issues, - examining which ones are resolved, those that are not, and which ones still remain
as priority issues requiring immediate stakeholder attention. It aims to provide a means of
coordinating the efforts and resources of marble sector stakeholders – including GoIRA
ministries/agencies, international development agency programs, business associations and
private sector entrepreneurs to implement projects and initiatives to resolve the principal
problems that are inhibiting the growth and expansion of the marble sector.
The 2013-2106 marble sector action plan lists the principal priorities and activities that are needed
to stimulate the development of this sector. It also includes information on the resources that can
be mobilized to address these problems, secure stakeholder support to undertake systematic
efforts to remove constraints and provide the basis for developing detailed implementation plans
and procedures for achieving the objectives contained in the plan.
Recent developments and current status of the sector
 Delegation of authority by MOMP to some of the Provincial Directorates to administer the
“quarrying licence bidding process” and issue contracts
 The terms of extractive contracts awards to bidders have changed from being based only on
the ‘amount of proposed royalty payment’ to a more transparent evaluation incorporating
technical capability & experience, financial resources, and scope of the proposed
environmental plan
 Reduction in Royalty Fees to 10% of gross sale value, with a change from the advance royalty
payment, to payment in arrears - at end of quarter
 Amendments to the Minerals Bill 2010 and Mining Regulations have been drafted which
eliminate many of the onerous licensing processes and payments and allow for a more
transparent award process; it is currently before Parliament awaiting final approval
 Almost 40% of quarries have, or are in the process of converting to wire and saw extraction
 Improvement in time period for the granting of a mineral extraction licence by MOMP
 A major increase in the number of marble processing plants; since 2010up to 40 have
commenced business operations in Herat province
 Guidelines on ‘Health and Safety in Mining Operations’ and ‘Manufacturing, Transport,
Storage and Use of Explosives’ have been issued by MOMP
 MOMP has established an investment promotion department to promote the Afghan mining
sector with a specific focus to explore new markets
 MOMP is developing automated systems and procedures to manage all activities in the
resources sector from: research, mapping, geological surveys, exploration, extraction,
processing, health and safety and export shipment to attract investment in the sector
 MOMP is presently establishing a ‘state of art ’testing laboratory to certify Afghan marble
in accordance with ATSM standards
4
Priority problems and constraints
1. Lack of reliable pre-feasibility studies and geological surveys on the quantity and quality of
marble deposits
2. Shortage of quarried stone input supplies from a limited number of licensed quarries to the
processing companies
3. Lack of, and high cost of continuous “three-phase” high voltage power from the national
grid supply to operate processing plants; similar issues with water supplies
4. Improvements to the legal and regulatory framework to eliminate the culture of demands
for informal payments (illegal taxes) and spurious charges and fees throughout the value
chain (quarry to export)
5. Royalty rates are considerably higher than those assessed in competitor countries, in spite
of recent royalty rate reductions
6. Government needs to increase the collection of tariffs on imported marble tiles and support
the sector by insisting on use of Afghan produced and finished marble in all GoIRA
construction projects
7. High interest rates for short-term loans, lack of access to longer term financing for larger
capital investments ($100,000 to $8m) where the loan tenure should be up to 10 years, and
lack of commercial bank financing for lease purchase of cranes, gang saws and trucks(3-5
years)
8. Need to improve the capacity of local technical expertise (cutting, polishing, finishing) to
move Afghan marble up the value chain
9. Need for vocational training on mechanical and electrical trades to repair and maintain
quarrying and processing equipment
10. Need to change the present reluctant mind-set of the marble sector companies to adopt
modern mining and processing practices
11. Infrastructural deficiencies, poor quality of access roads to remote quarries
12. Security problems throughout the value chain – from quarries to customers
Overview and Current Status of the marble sector
Nature, scope and importance of the marble sector
Afghanistan is home to 60 known deposits with as many as 35 varieties of marble in 40 different
colors. With numerous high-quality deposits, the Afghanistan dimension stone industries has the
potential to become a significant player in the Afghan economy and provide thousands of rural
jobs at the quarries and in the downstream processing industries.
The quality and quantity of Afghan deposits provides a comparative advantage which the
industries can leverage to build a competitive advantage. Afghan white marble, primarily from
the Spin Ghar mountain range in Nangarhar Province, is well known internationally as a highquality stone, but is difficult to get to market. Also, the deposits in Chesht and Khogiani marble
from Herat are of top quality white marble very similar to Cararra marble from Italy.
Buyers in the Gulf Countries, U.S., Italy and neighbouring countries currently purchase this marble
and demand for it exceeds the available supply. Nine white cities are being created in
Turkmenistan using Afghanistan white marble which has replaced imports of Italian marble. As
perhaps the only source of high quality white marble in the region, Afghanistan enjoys a
5
comparative advantage with other regional competitors based on the availability of raw
materials, and with respect to Italy as a result of its proximity to market. The high value of the
marble covers the higher costs from inefficiencies within the marble sector’s value chain.
Besides Chesht and Khogiani, numerous other deposits with export potential have been
identified. The onyx deposit in Helmand is one of the few in the world and reputed to be of the
highest quality; onyx currently sells for multiples of 3 to 5 times the price of marble in global
markets. Principal areas of activity for marble are Herat, Kabul, Jalalabad and Kandahar and there
is a deposit of white onyx in Maymana.
The vision of the Government for the marble sector is to create an efficient, profitable, socially
and environmentally responsible marble quarrying and processing industry that benefits
Afghanistan as a whole, realizes economic and employment benefits for Afghan men and women,
without damaging the environment.
The US geological survey estimated the size of marble reserves in Afghanistan to be over 9 billion
tons – with an estimated value around $200 billion.
Table 1: Estimated marble reserves in Afghanistan
Province
Marble (million m3)
Granite (million m3)
Wardak
Jalalabad
Bamyan
Badakhshan
Herat
Helmand
1,500
3,500
/
1,300
30
300
/
/
2,400
Others
2,500
/
/
/
Table 2: Number of marble and granite reserves per province
Kabul
13 (M)
Parwan
4 (T)
1 (OX)
Nangarhar
5 (M)
2 (G)
Wardak
2 (M)
1 (G)
3 (TRA)
Bamyan
2 (M)
3 (G)
5 (TRA)
Panjshir
8 (M)
7 (G)
Laghman
2 (M)
1 (G)
Herat
4 (M)
1(OT)
Balkh
1 (M)
Source: USGS, GPS Survey 2009
M: marble; G: granite; TRA: travertine; OX: onyx; OT: others
Figures in front of the brackets are number of reserves
Afghanistan annual marble production is around 124,000 to 155,000 tons, with over 50% of
unprocessed marble going to Pakistan and Iran markets. Afghanistan consumption of finished
marble is around 270,000 tons with approximately 80% of the domestic market being dominated
by Pakistani finished marble. Currently the total value added of the Afghan marble industry is
around $105 million which makes 0.6 percent of GDP.
6
Marble Production over 2005-2011
Production (in thousand tons)
45
40
35
30
25
20
15
10
5
0
2004
2005
2006
2007
2008
2009
20120
2011
2012
(Years)
Source: Ministry of Mines and Petroleum
Extraction, Procession and retail price of Afghan Marble per Ton USD, 2014 AMA:
The following table was prepared based on the preliminary research in Kabul including a
detailed discussion with the Head of the Afghan Marble Association.
Mining
Location
Extraction
Cost per
Ton-USD
Royalty
Rate per
TonUSD
Transportation Processing # of Sq. Meters Retail
Cost from the & Cutting Produced from PriceQuarry to
Cost-USD One Ton
USD
Factory-USD
Unprocessed
Marble
Hirat
21
10-33%
35
55
7 Meter Square 31 USD
with 2CM
per
Width
Meter
Square
Ningarhar 21
10-33%
20
50
7 Meter Square 24 USD
with 2CM
per
Width
Meter
Square
Kabul
10-33%
8
45
7 Meter Square 21 USD
with 2CM
per
Width
Meter
Square
21
7
Notes:
1. The Transportation cost differs based on the location & distance of the Quarries from the
Factory.
2. The Processing & Cutting differs based on the design and clients demand.
3. Retail price of Marble depends on the shape, color, width and quality of the Marble.
4. The Extraction cost also differs from quarries to quarries depending on the basic facilities
provided.
8
No. Country
Mineral Type
% Royalty
Rate
1
Afghanistan
Marble
2
Turkey
Marble, granite, onyx and
other dimension stones
2%
Based on gross sales value
3
Vietnam
Marble, granite, onyx and
other dimension stones
2.5%
Based on gross sales value
4
India
Marble, granite, onyx and
other dimension stones
300 Rs =
Based on gross sales value
10 - 33 %
Royalty computation
method
Fixed amounts based on the
quality and type of stones
5 USD
5
China
Marble, granite, onyx and
other dimension stones
5%
Based on gross sales value
6
Oman
Marble, granite, onyx and
other dimension stones
2%
Based on gross sales value
7
Pakistan
Marble, granite, onyx and
other dimension stones
6% - 7.5%
Based on gross sales value
8
Iran
Marble, granite, onyx and
other dimension stones
5% - 7%
Based on gross sales value
9
Kazakhstan
Building materials, clay and
marble
10
Philippines
Salts, stones, sand and
similar minerals
1%
Based on the gross sales
value
11
Botswana
All minerals except for
precious metals and stones
3%
It is charged on the gross
market
3.5% - 4.5%
Computation based on sales
revenue payable on the
values of extracted mineral
resources
value payable on minerals
12
South Africa
Marble
3.5%
9
13
Tanzania
All minerals except for the
gemstones and diamonds
5%
Royalties are chargeable on
net
book value of minerals
produced
14
Australia
Marble
15
Namibia
Dimension stones
16
Zambia
Marble
$1 per ton
10
5%
Ad Valorem, market value
2.5%
Based on gross revenue of
minerals produced.
Royalty Rate Comparison:
A study undertaken by the Ministry of Mines and Petroleum in 2011 on comparative rates of
royalty payments from a sample of sixteen countries, illustrates that Afghanistan has the highest
rate of royalty fee for the extraction of marble, granite, onyx and other base construction
aggregate materials.
Principal markets
Marble exports during 2011-2012
Principal export markets include: Pakistan, Iran and China
Marble Exports CSO - 2012
No.
1
2
3
4
5
6
7
8
9
10
11
12
USD
value
1,055,774
1,037,464
832,798
193,830
129,840
110,238
96,981
33,265
22,990
12,105
11,500
10,735
3,547,520
Country
Pakistan
Iran
China
Turkey
UAE
Italy
India
Turkmenistan
Canada
Azerbaijan
Iraq
Hong Kong
Quantity
Kgs
2,111,798
2,017,138
1,666,924
392,305
260,470
221,535
193,961
66,690
45,980
24,210
23,000
21,470
7,045,481
Source: EPAA-CSO
Note: Official export figures may under-estimate the actual value of exports by as much as
80%
The Marble Sector Value Chain
11
Structure and performance
There are more than 30 factories producing marble in Afghanistan, but the total output is
undocumented. Approximately 90% of marble quarried is exported as rough-hewn blocks to
Pakistan where it is processed and then transported back to Afghanistan. Most of the value in
production of marble is created in the final two steps which are typically carried out in Pakistan.
Finished marble products imported from Pakistan dominate the market as local producers are
unable to compete with the lower prices and higher quality of these products. The Afghanistan
marble industry suffers from a lack of adequate equipment, has little technical knowledge, and
uses poor extraction methods that often significantly reduce the value of the marble. Extraction
is by low tech, wasteful, explosive-based methods using ‘black powder’, typically imported from
Pakistan. This causes micro-fracturing throughout the entire quarry and results in 50% wastage at
the quarrying stage.
Further wastage occurs at the marble factory where blocks often break up during the cutting and
polishing stages of production. The result is a relatively poor quality polished marble with a
comparatively high unit cost of production.
Comparative Value Chain Analysis for Marble Sector in USD per ton in Afghanistan
Comparative Value Chain Analysis
241
201
161
121
81
41
1
Extraction Cost per Ton Royalty Rate per ton
Hirat
Transportation Cost
Ningarhar
Processing & Cutting
Cost
Kabul
Source: Afghan Marble Association, 2014
12
Retail Price
SWOT analysis - Strengths and weaknesses or gaps in the marble sector value
chain
Strengths
Weaknesses






Large deposits of superior quality marble
Well-known in regional markets for quality
marble
Proximity to major markets in Asia
Availability of low-cost labor
Ongoing investment in the Industries





Inconsistent supply and quality due to poor
quarrying practices
Poor infrastructure, security problems, and
corruption hinder access to quarries
Value-chain weaknesses – poor processing
and logistic facilities
High transportation and shipment costs to
export markets
Lack of diversified export buyers
Difficulties in securing commercial financing
Opportunities
Threats







Development of marble sector value chain
Marble sector offers most potential for SME
growth and rural employment in certain
provinces
Sourcing new buyers – regional &
international export markets
Strong import substitution potential
Handicraft and artisanal market potential to
recycle marble wastage from the quarries
Opportunities to access financial and
technical support from international donors
and investors



Failure to fulfil international quality
certification standards
High costs of sophisticated mining and
processing equipment
Continuing lack of high quality, affordable
technical training facilities
Continuing security threats in rural areas
Investment needs and opportunities
Expanding and improving quarrying: Introducing improved wire and saw extraction technology
and expanding quarrying through improving access to high-quality marble deposits should enable
the sector to grow quickly and result in increased productivity and improved profitability.
Moving the industries into more profitable parts of the value chain: The repatriation of key parts
of the value chain from neighbouring countries offers investment opportunities for establishing
cutting and polishing plants, as much of the downstream processing of Afghan marble is currently
done outside Afghanistan.
13
Strategy and priorities for improving competitiveness
Specific development priorities and actions
Information provided by stakeholders during the course of the development of this updated
action plan, together with a review of available reports and analyses of the Afghanistan
marble sector, provides a clear and consistent picture of the principal problems that need to
be addressed to support the development of Afghanistan’s marble sector.
1. Supply inputs – Existing licensed quarry operators need to provide more regular deliveries
and increased supplies of stone to processing companies.
2. Skill levels and training –Vocational skills training is required to improve the capacity of
local technical expertise in the areas of stone cutting, polishing and finishing to reduce
wastage and move the quality of Afghan marble for export up the value chain.
Mechanical/electrical skills training also required for extraction and processing machinery
maintenance and repairs.
3. Electricity cost – Electricity supply and coverage is limited and of poor quality from the
national grid. Dependence on diesel generated power is the norm and is expensive.
Ministry or Energy and Water needs to address this.
4. Availability of water – Poor access to regular water supplies to support the cutting,
washing and polishing processes is problematic and expensive, processors have to
purchase tanker quantities. MOEW to address this.
5. Increased import duties – Government to increase duty levels (or enforce collection of
duties at current rates) on imported finished marble from Pakistan to support domestic
industries.
6. Reduced export duties–Ministries of Finance and Mining and Petroleum to formally
reduce export duties on Afghan produced marble – (promised but not implemented).
7. Developing market awareness – Exporters with EPAA and AISA support, need to increase
direct contacts with end-market buyers through regular participation in trade shows and
market promotion events. A web portal for Afghanistan marble exporters should be
developed to promote product awareness.
8. Improving transportation and logistics --Marble sector firms need to collaborate with
shipping companies and MOTCA to develop lower cost transportation links through an
expanded array of trade corridors; the GoIRA should speed up efforts to remove
remaining barriers caused by inefficient, corrupt and improper customs operations and
work to fully implement new trade agreements and transportation treaties such as the
TIR (International Convention on Transport Routes).
9. Provision of land and infrastructure – MOCI and private sector firms and associations
should lobby AISA and other GoIRA ministries to speed up the availability and process of
14
acquiring serviced facilities in industrial parks and other locations. This would encourage
the development of marble sector clusters that offer better working conditions and
increased employment opportunities.
10. Improving access to finance— Entrepreneurs need access to longer term financing
($100,000 - $8 million) necessary for larger item capital investments, loan tenure should
be up to 10 years. Lease financing products for pneumatic steel drills, hammer drills, wire
and saw block equipment, derrick cranes, excavators, loaders and dump trucks.
Stakeholder roles and sources of assistance
The following table provides an illustrative summary of the roles that different groups of
stakeholders can play in implementing the marble sector action plan in order to promote the
growth of the sector. It includes current sources of assistance for various types of business
development activities:
Problem area
Stakeholder roles
Sources of
assistance1
Improving supply
of inputs
Marble sector associations and companies to develop MOMP, MOCI,
more streamlined licensing procedures for new quarry
AGMPA, AMIA
operators and identify existing licensed quarries that
ABADE
are not meeting local processor demands
Donor programs – help quarrying firms acquire
equipment (through PPAs or loans) to increase marble
extraction
Skills level and
training
Establish training centers– invest in skills training on
cutting, polishing, resource and waste management.
Specialist technical trainings on mechanical and
electrical trades to support extractive and processing
machinery maintenance
Electricity and
water supply and
cost
Ministry of Energy & Water, Da Afghanistan, Da
Brishna Shirkatand, AISA to provide adequate voltage
from the national grid at affordable cost as opposed
1
ABADE, ADF,
FAIDA, IFC,
OPIC, AGF
COE
AMIA
AMGPA
MOEW, AISA,
MOCI
The above list includes some of the projects and organizations that are currently supporting activities related to
the marble sector or potentially could contribute resources in the future to help improve performance in these
areas. Listing these organizations and projects does not imply a commitment to undertake specific marble sector
development initiatives. Specific roles for different organizations, projects, and other stakeholder groups will be
worked out over the course of implementing this action plan.
15
to diesel generator supplies. Similarly for water
supplies
Amending export
and import duties
Ministries of: Finance, Commerce & Industries and
Mining & Petroleum to lobby Government to increase
duty levels and collections on finished marble imports
from Pakistan, and reduce export duties on Afghan
marble exports
Developing
Marble associations, exporters and companies –
market awareness arrange regular participation in regional/international
trade shows and marketing events; facilitation of visas
for travel, development of a websites to promote the
Afghan marble brand
MOCI, MOF,
MOMP,
MIDAS
EPAA, AISA, COE
NMDP-WB
AMIA, AMGPA
Future:
Donor programs: provide technical and financial
support to help organize and conduct market
promotion events and provide market promotion
training
Improving
transportation
and logistics
MOCI – reactivate Afghanistan’s membership of TIR,
renegotiate more favorable terms of existing bi-lateral
transport agreements, including the Afghan-Pakistan
trade transport agreement.
Marble sector associations and companies –Negotiate
with freight forwarders and shipping companies to
obtain more favorable rates.
MOTCA—facilitate negotiations with shipping
companies and offer incentives to help exporters
obtain more favorable rates.
Donor support
TBD
ACCI, AISA,
AMIA,
AMGPA
MOTCA, AISA
AMIA, AMGPA
Future:
Donor support
TBD
Future:
Donor support
TBD
Provision of land,
infrastructure for
processing /value
chain activities
Speed up the process of making land and supporting MAIL, AISA,
infrastructure available in industrial parks and other MOCI, AMIA,
locations, to marble sector companies to upgrade
AMGPA
processing capabilities.
Improved access
to finance
Donor programs – provide funds/credit lines to ADF, IFC,
financial institutions to introduce new long term
OPIC, AGF,
financing products (up to 10 years) to fund larger
capital investments.
MOCI– encourage the commercial banks to develop MOF,
new financing products (e.g. lease financing) to meet ADF, FAIDA
16
the real financing needs of the marble sector
companies.
Recommendations for action plan implementation
Implementing the activities included in this action plan will require cooperation, active
participation and support from the full range of stakeholders in the marble sector, including
Government ministries and agencies, companies, business associations, individuals, NGOs,
International development agencies and project implementers.
A Working Group will need to be formed with representatives from the various groups of
stakeholders to manage the way forward. The group will need to work out methods for
undertaking cooperative initiatives to address and solve the priority problems highlighted in this
action plan. This will entail:
 Organizing specialised Task Force Groups that include participants willing to take an active
role in dealing with the specific challenges outlined in the action plan
 Sharing information
 Actively collaborating to develop specific implementation plans, systems and schedules
to deal with constraints and problems outlined in this action plan
 Developing linkages with handicraft and artisanal manufacturers to utilize quarrying ‘offcuts’ to eliminate product wastage
 Assigning responsibilities to different groups and individuals and establishing schedules
and deadlines for carrying out various tasks
 Monitoring progress in achieving performance targets and meeting deadlines
17
Action Plan for Afghanistan’s Marble Sector
Sept 2013
Summary of priority problems and actions
Main problems
Main priorities
Possible tasks/activities
Possible Sources
of support2
Priority (high,
medium, low)
MOCI SME Directorate and Marble Associations to lobby Ministry of
Mining & Petroleum to:
MOMP, AGMPA,
AMIA
High
MOMP, MOCI,
AISA, ANSA, COE
High
Stone supplies from licensed quarries
Lack of regular
supplies of
quarried marble
to downstream
companies
MOMP to increase the
number of licenses
awarded to
companies to operate
quarries
Exploration and
testing
Support mining
/quarrying companies
to assess size and
quality of deposits
-
Increase the number of licensed quarry operators,
Develop streamlined procedures for license approval to new quarries,
and
- Increase the areas to be explored to facilitate increased stone
extraction to meet market demand.
MOMP to arrange for samples to be taken from new deposits for testing.
Samples to be sent outside the country for testing to meet ASTM
standards
Electricity and Water supplies
2
This list includes some of the projects and organizations that are currently supporting activities related to the marble sector or potentially could contribute resources in the
future to help improve performance in these areas. Listing these organizations and projects does not imply a commitment to undertake specific marble sector development
initiatives. Specific roles for different organizations, projects, and other stakeholder groups will be worked out over the course of implementing this action plan.
18
Action Plan for Afghanistan’s Marble Sector
Access to high
voltage electricity
from the National
grid
Provide continuous
level of high voltage
power at reasonable
cost. Similar for access
to regular water
supplies
Sept 2013
Ministry of Energy and Water to provide “three-phase” power to the
marble sector companies.
MOMP, MOCI,
High
AMIA, AMGPA
Da Brishna Shirkat
Improvements to the legal and regulatory framework
Informal
payments being
demanded
throughout the
value chain
Government action is
required to eliminate
this culture which
hinders the price
competitiveness of
Afghan marble
MOCI and the sector associations to work with Customs Commission and
the Ministry of Interior to develop a strategy to address the problem of
informal payments.
MOCI, AMIA,
AMGPA, MOI
High
Lack of protection
of domestic
market
Government to
mandate the use of
Afghan marble on all
Government funded
construction projects;
Customs needs to
improve collection of
customs duties for
imported products
Better enforcement of customs requirements for importing finished
marble products from Pakistan to ensure the correct amounts of import
duties are being collected.
MOF, MOMP,
Medium
Government procurements for construction contracts should include local
content requirements for marble and stone products
19
MOCI,
Action Plan for Afghanistan’s Marble Sector
High royalty rates
and export duties;
poor enforcement
of import duties
for marble tiles
from regional
competitors
Government action is
needed to further
reduce royalty rates
and eliminate export
duties on processed
products
Sept 2013
Marble associations need to lobby the government to eliminate import
duties on processed marble products (as was previously agreed upon) and
reduce royalty rates to more competitive levels more closely aligned to
rates charged by regional competitors
MOCI, ACD, MOF
High
The Customs Department needs to conduct review of import duties
assessed on imports of marble tiles from Pakistan to eliminate
undervaluation of imports and customs charges
Transportation and logistics
High
transportation
costs
Negotiation of
favorable cargo rates
with trucking
companies
MOCI to support exporters in efforts to negotiated competitive shipping
rates
MOCI, AGMPA,
AMIA, AISA, ACCI,
High
Transport and
trade agreements
Renegotiation of
existing bi-lateral and
regional trade
transport agreements
Reactivation of Afghanistan’s membership of TIR and renegotiation of the
terms and conditions of the Afghanistan/Pakistan trade transport
agreement
MOTCA, ACCI,
High
20
Action Plan for Afghanistan’s Marble Sector
Sept 2013
Developing market awareness
Poor market
linkages
Develop increased
market opportunities
for Afghan finished
marble
MOCI to support the development of a consistent marketing strategy and EPAA, ACCI, COE,
engage in joint activities that support international marketing programs for
AMIA, AMGPA,
Afghan producers, processors and exporters. Development of a marble
sector website to promote the Afghan marble brand.
NMDP
Medium
MOCI to work with the associations, companies and donors to define
training needs and develop training programs for best quarrying
techniques and quarry safety and improved methods of cutting, carving,
polishing and finishing.
MOCI, MOMP,
COE, MIDAS,
AMIA, AMGPA
Medium
Finance required by larger companies for purchase of quarrying rights.
Financing in the range from $100,000 to $8 million is unavailable in the
market due to the loan risk for Afghanistan
MOF, IFC, ADF,
ARFC, AGF, OPIC,
AISA
High
Skill levels and technical expertise
Poor levels of
skills modern
mining and value
chain
cutting/polishing
practices
Undertake a needs
assessment to define
a sector training
strategy to raise local
skills standards
Improving access to finance
Lack of sources of
finance for capital
expenditure and
equipment leasing
Identify provider/s of
long term financing
(7-10 year loan
tenures) or equity
capital
Financing for purchase /leasing of processing plant and machinery is
required (up to 5 year loan tenures)
21
MOF, Afghan
commercial banks
Action Plan for Afghanistan’s Marble Sector
Sept 2013
22