Afghanistan seeks Chinese support to exploit vast mineral wealth

Three years after the Taliban took control of Afghanistan, the cash-strapped regime is intensifying efforts to tap into the country's rich mineral resources, particularly copper, which is crucial for electric vehicle batteries and semiconductors.

To achieve this, they are turning to China for crucial support. Afghanistan’s mineral wealth, potentially worth up to $1 trillion according to 2010 US estimates, includes what may be the world’s second-largest copper deposit. However, decades of conflict and instability have prevented the extraction of these resources, Caliber.Az reports, citing foreign media.

The Taliban are focusing on developing Mes Aynak, a massive copper deposit southeast of Kabul, which is estimated to contain around 4.4 billion metric tons of copper ore. China, a dominant player in global mineral supply chains, is essential to advancing this project. Michael Kugelman, director of the South Asia Institute at the Wilson Center, notes that the Taliban view this project as central to their broader goal of integrating Afghanistan into regional connectivity initiatives across South and Central Asia.

The push to develop Mes Aynak dates back to 2008, when China Metallurgical Group Corp. obtained a $3 billion, 30-year concession for the mine. After years of delays, the project has seen renewed interest, evidenced by a July ceremony marking the start of road construction to the site, which Chinese officials hailed as a significant advancement. Despite this progress, analysts highlight significant hurdles, including security concerns, regulatory and legal issues, financial constraints, and the potential impact on historic sites. 

Developing such a project is complex and requires long-term investment and commitment. “This is a complex undertaking, and investing in a mine like this demands not only substantial financial resources but also significant stability,” said Jennifer Brick Murtazashvili, founding director of the Center for Governance and Markets at the University of Pittsburgh. “China is not naive; they are unlikely to invest heavily in a venture that could fail if Afghanistan descends into further civil conflict.” China's involvement in the project mirrors its broader aim of ensuring regional security and reducing instability that could affect its own border with Afghanistan. “China’s main concern in Afghanistan is not the minerals, but rather stability and security,” Murtazashvili added. 

“The Taliban are acutely aware of this.” Following the US withdrawal from Afghanistan in 2021, experts have noted that China’s engagement with the Taliban is driven by pragmatic interests in maintaining strong relations with its neighbour and advancing its own security and political objectives. “China has been actively involved in Afghan diplomacy and has taken a pragmatic approach,” said Eric Olander, editor in chief of the China-Global South Project. “Beijing sees an opportunity in the US departure, knowing it won’t return.” China was the first country to appoint an ambassador to Afghanistan under Taliban rule and has made moves in oil extraction and explored the country’s lithium reserves, another key mineral. Since the Taliban’s takeover in August 2021, China has provided over 350 million yuan (approximately $49 million) in humanitarian aid, according to China’s Ministry of Foreign Affairs. “The Chinese believe that development leads to stability and peace,” Olander noted. “Part of their political strategy is to use economic engagement to foster stability and contribute to development, which in turn promotes peace.” 

Beyond political motivations, Beijing also has substantial commercial interests in the success of the Mes Aynak project. “China is keen to see progress on this project,” said Yun Sun, director of the China program at the Stimson Center. “The project has been stalled for a long time, and despite their investment, there has been little tangible progress.” For the Taliban, this focus on Mes Aynak is promising as they seek new sources of revenue and foreign investment. Since taking power, the Taliban have faced a severe drop in foreign aid due to international sanctions, leading to a devastated economy and worsening humanitarian crisis.

"Since the Taliban's takeover, Afghanistan has faced a severe economic downturn due to its heavy reliance on international aid for many years," said Kugelman. He highlighted the group's difficulty in attracting foreign investment, especially from wealthy nations. In search of increased funding and international recognition, the Taliban have actively pursued closer economic ties with China. 

Last year, they announced their intention to formally join Chinese President Xi Jinping’s Belt and Road Initiative (BRI) and the China-Pakistan Economic Corridor, which was established under the BRI. “The Taliban is working hard to demonstrate that it is not isolated,” Kugelman noted. “Partnering with China, a major global player, on economic projects sends a powerful message that the Taliban hopes will enhance its international standing.” However, numerous obstacles remain. 

Despite efforts to strengthen economic connections with China, advancing the Mes Aynak copper project faces significant challenges, including threats from Islamic State-Khorasan attacks, security issues, and substantial financial, legal, and regulatory uncertainties. Additionally, recent fluctuations in copper prices highlight the project's inherent difficulties. “There’s virtually no infrastructure in Afghanistan—no power, water, or railways,” said Olander of the China-Global South Project. “While Afghanistan may have significant reserves of lithium and copper, the complexities of extraction, transportation, and reaching port present considerable risks and costs, especially compared to more developed, less risky, and cost-efficient alternatives.”