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Coca-Cola Goes to Afghanistan

The Kabul factory is the first major business to open in the five years since the Taliban's fall.

September 11, 2006|From Reuters

KABUL, Afghanistan — The haunting Arabic prayer chant echoed among the sterile plastic rows of Coke and Fanta, seeking Allah's blessing for the only major business to open in Afghanistan in more than a decade.

Coca-Cola, with its distinctive red-and-white logo, has come to Kabul in what is at once a sign of economic progress and a symbol of the failure of large businesses to open up in the five years since the fall of the hard-line Islamist Taliban.

On Sunday, President Hamid Karzai opened the $25-million bottling plant in the capital's industrial complex of Bagrami, which means sweet or fragrant.

Karzai's Western-backed government is desperate to kick-start an economy independent of the $3-billion-a-year illegal drug trade but has been unable to lure investors to one of the world's five poorest countries, where violence has hit a high since the 2001 war.

The plant, which Coca-Cola Co. goes out of its way to emphasize will produce only nonalcoholic beverages, is franchised to one of the country's richest men, Habib Gulzar, and will initially produce Coke, Fanta and Sprite and soon will bottle water, the company said in a statement.

During the Taliban's five-year rule, only a pirated version of Coca-Cola was available in the country.

"Afghanistan is a country promising a lot of growth opportunity for our company," Coke's Pakistan and Afghanistan manager, Rizwan Khan, said at the opening.

The ceremony began with the chanting of Qari Barakatullah Salim, Afghanistan's most famous Koran reciter, who despite being blind has memorized the entire Islamic holy book.

Karzai spoke only briefly and waved off an offer of a glass of Fanta.

Although Afghanistan is one of the world's five poorest countries, Coca-Cola's southern Eurasia head, Selcuk Erden, said the country of about 25 million was "the missing link" in the company's global business strategy.

But the country has no economy, and apart from thousands of United Nations personnel, foreign troops and aid workers, few people have money to spend.

The average income is about $200 a year. A small bottle of Coke costs about 20 cents in the shops.

"Nothing much has been done to develop the economy. There is no investment," academic, writer and former cabinet minister Hamidullah Tarzi told Reuters recently.

"We are living in a sort of artificial economy. This is completely false because there is no production and there is nothing you can call investment."

Any business looking at Afghanistan must invest heavily in security. By some estimates, 10 times as much money is spent on security as on development.

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