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Reconstruction Efforts in Afghanistan Receive Boost from MIGA

May 15, 2008—After more than two decades of conflict, Afghanistan has begun a political, economic, and social transformation. Reconstruction activities have been carried out at a fast pace, resulting in a doubling of demand for primary construction materials, such as bricks, in the last three years.

Kiln-fired mud bricks are typically used for the construction of public, commercial, and private buildings. But excessive demand, high energy consumption, transport costs, and the low quality of bricks is frustrating the construction industry, and the integrity of construction work is often compromised.

Supporting investments in conflict-affected countries is a strategic priority for the Multilateral Investment Guarantee Agency (MIGA). Since 2006, MIGA has issued more than $80 million in guarantees in support of investments in agribusiness, telecommunications, banking, and services in Afghanistan.

Among the investments supported is the Geo Building Technologies project, for which MIGA recently provided $0.87 million in guarantees. Another $0.87 million is being guaranteed by the MIGA-administered trust fund, Afghanistan Investment Guarantee Facility.

Geo Building Technologies is introducing "GreenMachine" and "GeoBricks" in Afghanistan. The GreenMachine is a portable, self-powered system designed to manufacture durable compressed-earth blocks called GeoBricks. The project is expected to provide builders in Afghanistan with a lower cost, higher quality, and more energy-efficient building material. If the experience is successful, operations will be expanded into neighboring countries.

"The MIGA guarantee helped us feel more at peace with making the investments in a country in conflict," says Rafaat Ludin, President and CEO of the project sponsor, International Home Finance & Development, LLC. "The process of approval by MIGA helped in directing some of our human resources, social and environmental policies and procedures towards greater responsibility."

The introduction of GeoBricks is expected to create significant employment opportunities. By offsetting carbon emissions, the project is expected to receive carbon credits for every GeoBrick manufactured.

See the project brief for more.

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