ASSESSMENTS

The Future of Chinese Investment in Afghanistan

MIN READJan 12, 2023 | 22:48 GMT

Afghanistan's acting Deputy Prime Minister, Abdul Mullah Abdul Ghani Baradar, (L) and China's Ambassador to Afghanistan, Wang Yu, (R) attend a press conference to announce an oil extraction contract with a Chinese company in Kabul, Afghanistan, on Jan. 5, 2023.

Afghanistan's acting Deputy Prime Minister, Abdul Mullah Abdul Ghani Baradar, (L) and China's Ambassador to Afghanistan, Wang Yu, (R) attend a press conference to announce an oil extraction contract with a Chinese company in Kabul, Afghanistan, on Jan. 5, 2023.

(Photo by AHMAD SAHEL ARMAN/AFP via Getty Images)

China will explore low-risk economic opportunities in Afghanistan in the short-to-medium term, providing modest economic and humanitarian relief for the Taliban-led government. On Jan. 5, the Taliban-led government in Afghanistan announced the signing of an oil extraction deal with a Chinese company in the presence of the Chinese Ambassador to Afghanistan, Wang Yu, and Afghanistan's acting Minister of Mines and Petroleum, Shahbuddin Dilawa. Under the deal, Xinjiang Central Asia Petroleum and Gas Co. (CAPEIC) will extract oil from the Amu Darya basin in the northern provinces of Afghanistan. This is the first major investment in Afghanistan since the Taliban takeover in 2021, and it highlights China's economic interests in the country as the West continues to isolate Kabul in response to the Taliban's hardline policies, particularly with respect to women....

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