What is state failure? See my conceptualisation of state failure on the right flank below.

Wednesday, November 7, 2007

Terrorism hits Baghlan: Update II.

Here's some interesting, complementary reading related to yesterday's bloody terror attack in New Baghlan: an article on the New Baghlan Sugar Company, from 2005. In the process of setting up the Afghan-German joint venture, the company acquired the old Baghlan sugar factory.
They had a comprehensive plan to rehabilitate Afghanistan's traditionally Baghlan-based sugar production (and capture about a quarter of the Afghan market with that). Mostly German money got the project started, as well as German governmental backing and some development money coming in to aid the realisation of the project, plus the relentlessness of those behind it to push it through despite much obstruction from Afghan institutions.
Some relevant excerpts:
" The $12m project is funded by German seed company KWS SAAT AG, the German government and four Afghan investors, who each invested $2m. It aims to re-establish sugar beet cultivation in the Baghlan area, 250km north of Kabul, and rehabilitate local sugar refining facilities. Part of the deal was the acquisition of the “old” Baghlan Sugar Factory from the government, once the centre of Afghanistan’s small domestic sugar industry. "
" No precise data exists, but the best guess is that Afghanistan consumes 350,000–400,000 tons of sugar a year, all of it imported. Historically, some of this demand has been met locally, derived from sugar beet grown mainly in the area around Baghlan. First the Soviet invasion and then civil war brought production to a halt in 1991, when the Mujahideen forced farmers to give up cultivation of sugar beet. Since then, the old Baghlan Sugar Factory has remained idle.
In 2003, two German friends with links to Afghanistan – one the export director for KWS SAAT AG, a world leader in sugar beet seed, and the other a World Bank staffer – began investigations into rebuilding the domestic sugar industry and recapturing its sugar beet seed market for KWS. After a protracted process, the New Baghlan Sugar Company was registered in February this year. "
" “Investment in Afghanistan involving the public sector is not meant for the fainthearted,” says Alois Kühn of KWS. “Only those with sufficient stamina and commitment can prevail. But for those who do, an engagement in Afghanistan, where everything is needed, can be rewarding, both professionally and financially.”
The project has benefited from development finance and Mr Kühn admits that without the support of the German government, KWS would probably not have got involved. "
" Presently, three German sugar technologists, supported by 70 newly recruited local labourers and technicians, are rebuilding the plant. And a small team of international and local agronomists is working with local farmers advising them on growing beet. Encouragingly, trial plantings have produced yields of over 90 tons of sugar beet per hectare (t/ha), compared with minimum yield requirement of 35t/ha for project feasibility. "
The Afghan government made this statement back in 2005 on the NBSC project:
"Baghlan Farmers and Afghan Consumers Benefit from Privatization
In Baghlan in the North of Afghanistan, a new private-publicpartnership, The New Baghlan Sugar Company, Ltd., is gearing up to produce sugar in a country that currently has to import all the sugar it uses.
Four Afghan investors are providing EUR 8 million of capital and working capital to upgrade equipment and maintain operations. The Governmentof Afghanistan will provide the land and buildings from the old state-owned Baghlan Sugar Enterprise. German seed company, KWS SAAT AG will invest EUR 1 million and will supply seeds of high yielding sugar beet varieties together with technical assistance in modern sugar beet cultivation. The German Government, through the FAO trust and through an equity participation of the German finance and investment company DEG, will provide an additional EUR 2.5 million for the operation of the company, the procurement of farm inputs, management expertise and the recruitment and training of local extension officers. "
" After its refurbishment, the existing sugar factory at Baghlan will have the initial capacity to process 900 tons of sugar beets per day. An average hectare is expected to produce 50 to 70 tons of sugar beets if beet growers accept the inputs and technical assistance offered by KWS. Mid term plans foresee the expansion of the present production capacities. Once these plans have been realized the New Baghlan Sugar Company will be in a position to supply around 25% of Afghanistan’s total sugar consumption. "
I have yet to find out about what it implies that in December, 2006 the resumption of sugar production at the Baghlan factory was already announced. (At the time Xinhua found it important enough, too, to report on Afghanistan's only sugar plant recommencing production.) The first source I'm linking to notes that at the time there were plans to still expand and upgrade the factory, so I suppose the November 6 handing-over ceremony this year could have been held to mark the completion of some vital stage in that process (for which I guess work at the factory might have been suspended even, for a while). Regarding employment capacity, the article notes that at the time there were 120 people working in the factory, some 210 farmers involved in producing sugar beet for it, and about a thousand more involved in transporting the produce (fields to factory to market I guess).
(14:15, p.m., Budapest local time)
Update at 15:00: I checked Wikimapia for the location of the sugar factory, and there is a Russian tag attached to Baghlan city's area which suggests where it could possibly be. So according to this you find the Сахарный завод here:

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