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Impact on the scale of the Afghan economy

We’re thrilled to launch the Afghanistan Marketplace Impact Report.

Building Markets implemented the Afghanistan Marketplace initiative from January 2006 to March 2012.  A suite of market linkage services was provided in Balkh, Helmand, Kabul, Kandahar, and Nangarhar, to both international buyers operating in Afghanistan and Afghan SMEs.  These included:

–an online supplier directory listing over 8,200 detailed business profiles;

–business matchmaking services;

–tender distribution services; and,

–business training.

This was possible due to the generous funding of DfID, CIDA and other contributors.

A big thank you goes out to everyone that worked on this project since 2006.

Some of our team, minus our Afghan female staff. Thanks a million.

Impact on the scale of the Afghan economy

Over 400,000 data points about business in Afghanistan have been collected.  Over 50,000 phone calls have been made to survey Afghan businesses. Over 1,000 matchmaking reports were issued.  Over 1,400  Afghan businesses took part in events.

Since 2006, both buyers and suppliers have told us that they used the Marketplace services to confirm 1,364 contracts for 680 Afghan companies worth over $1 billion.  As a result, Afghan businesses created or sustained an estimated 130,000 six-month jobs or 65,000 full-time equivalent jobs through the implementation of these contracts.

Contracting has had a significant and positive impact on the Afghan economy. The information presented in this report is meaningful to understand the economic impact of local procurement in Afghanistan.  In 2010, the contract value confirmed by Afghan SMEs was equivalent to 1% of GDP, an impact on the scale of the national economy.

Local procurement should be at the heart of any future development and reconstruction strategy in Afghanistan to help the private sector create jobs and generate taxable revenue.

If you don’t want to read the report, just look at this graph. Graph by Kavya Raman.

Confidence in the numbers: Third-party assurance 

DfID’s mission is to help eradicate poverty in the world’s poorest countries.  In Afghanistan, DfID wanted to better understand how the private sector had created jobs, a key factor in developing prosperity and to verify the research conducted by Building Markets.  A non-financial audit of the Marketplace data was conducted by KPMG LLP.

In the context of Building Markets’ methodologies for gathering and analyzing data, KPMG LLP reviewed the number and value of contracts reported to Building Markets, the number of jobs estimated to have been created or sustained through these contracts, and the grant investment per job.  KPMG LLP prepared its limited assurance opinion in accordance with the International Standard on Assurance Engagements 3000: Assurance Engagements other than Audits or Reviews of Historical Information and in accordance with the requirements of the IFAC Code of Ethics for Professional Accountants.  KPMG LLP recommends that the full report and the full assurance opinion are read to understand the basis of its conclusions.

Learn more

The Building Markets Afghanistan Impact Report is available online at http://buildingmarkets.org/our-impact.  Additional economic research produced by Building Markets in Afghanistan can be at www.buildingmarkets.org/research.  Questions and comments can be sent to afghanistan@buildingmarkets.org.

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