VZCZCXRO0738
RR RUEHLN RUEHVK RUEHYG
DE RUEHDBU #0860/01 1610745
ZNR UUUUU ZZH
R 100745Z JUN 07
FM AMEMBASSY DUSHANBE
TO RUEHC/SECSTATE WASHDC 0420
INFO RUCNCIS/CIS COLLECTIVE
RUEHBUL/AMEMBASSY KABUL 2117
RUEHNE/AMEMBASSY NEW DELHI 2118
RUEHBJ/AMEMBASSY BEIJING 1958
RUEHIL/AMEMBASSY ISLAMABAD 2152
RUEHPW/AMCONSUL PESHAWAR 0019
RHEHAAA/NATIONAL SECURITY COUNCIL WASHINGTON DC
RUEAIIA/CIA WASHINGTON DC
RHEFDIA/DIA WASHINGTON DC
RUEHDBU/AMEMBASSY DUSHANBE 2141

UNCLAS SECTION 01 OF 02 DUSHANBE 000860 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: ECON ETRD PGOV EAID TI AF
SUBJECT: AFGHANS IN TAJIKISTAN -- READY FOR BUSINESS 
 
DUSHANBE 00000860  001.2 OF 002 
 
 
¶1. (SBU) Summary: While a common perception amongst Tajik 
officials and academics is that the Afghans are all poor, coming 
from a war-torn country with little education and healthcare, 
Afghan businessmen are surprisingly successful and growing 
wealthy in Tajikistan, and they have an equally dim view of 
Tajiks.  Indeed, according to Afghan businessmen in Dushanbe, 
all the Tajik government needs to do to promote cross-border 
trade is stop being corrupt, open the border, and get out of 
their way.  End Summary. 
 
Afghans Dominate Wholesale Food 
-------------------------------------- 
¶2. (SBU) According to Dr. Ata Mohammad Ghaznawi, Commercial 
Attache of the Afghanistan embassy (and successful businessman 
in his own right), the Tajiks, "would not be able to eat without 
the Afghans."  According to Ghaznawi, besides the roughly 2000 
small Afghan businesses (legal and illegal), there are about one 
hundred Afghan wholesalers that dominate approximately 75 
percent of imported foodstuffs throughout Tajikistan.  A brief 
tour of the Afghan warehouses in downtown Dushanbe, re-stocked 
daily from larger warehouses outside the city, showed vast 
supplies of vegetable oils, rice, and sugar from Dubai, wheat 
from Kazakhstan, and tea, cookies, candies, soaps, and 
detergents from Iran.  Tajik middlemen buy their goods from the 
Afghan wholesalers around 4:00 AM, and then sell them to small 
retail traders in kiosks at local bazaars. 
 
¶3. (SBU) Besides food and some dry goods, there is a robust 
trade in contraband cigarettes from Dubai, Pakistan via 
Afghanistan to Tajikistan, Uzbekistan, Kyrgyzstan and 
Kazakhstan.  According to Dr. Ghaznawi, about 50,000 cartons of 
cigarettes a month pass through Tajikistan's contraband markets. 
 
Corruption and Diplomatic Fall-out 
------------------------------------------ 
¶4. (SBU) Afghan success seems to be resented and exploited by 
various levels of the Dushanbe city government.  The Afghan 
wholesalers settled in Tajikistan during the late Soviet Union 
and early 1990s and concentrated their businesses near a 
multi-story shopping complex called Sadbarq (now often called 
the "Afghan bazaar").  Sadbarq has often been a bone of 
contention with the Dushanbe city government.  Afghan 
businessmen made a deal in the 1990s where they could use the 
market after they refurbished it.  After it was remodeled, the 
city tried to take it back and it is still unclear who 
technically owns it. 
 
¶5. (SBU) While Tajik women run the kiosks in Sadbarq, the kiosks 
and their goods belong to Afghans.  A 2001 car bomb near the 
bazaar was believed to be connected to a commercial dispute with 
an Afghan, and the city government tried to evict many of the 
traders and move them to a remote outdoor bazaar on the 
outskirts of the city the same year.  Since then, Afghan 
wholesalers have complained of regular shake-downs by the 
police.  (Post will report septel on recent round-ups of Afghan 
refugees and asylum seekers, many of them picked up from the 
Afghan dominated markets.) 
 
¶6. (SBU) These shake-downs almost threatened Tajik-Afghan 
relations two years ago.  By the time Dr. Ghaznawi arrived as 
Commercial Attache in Dushanbe in 2005, extortions took place on 
a weekly basis.  Ghaznawi recounted one particularly grizzly 
tale which involved a Dushanbe police officer holding a 
tazer-gun to an Afghan wholesaler's genitals until the Afghan 
paid out $8,000 to the policeman.  Dr. Ghaznawi claims that he 
personally threatened the Tajik Minister of Interior that he 
would close the border between Afghanistan and Tajikistan and 
tell President Rahmon publicly how Afghan businessmen are abused 
if the Minister did not find a way to stop the weekly extortion. 
 The next week, according to Ghaznawi, the policeman returned 
the money to the Afghan wholesaler, apologized, and such 
large-scale extortions with impunity have declined. 
 
Why Tajik Wholesale Traders Are Less Successful in Tajikistan 
--------------------------------------------- -------------- 
----------------------------------- 
¶7. (SBU) In discussing the difference in Tajik and Afghan 
traders with Ghaznawi, his deputy trade attache at the Afghan 
embassy Rangebar Samay, and later with two Afghan traders, they 
seemed to regard the Tajiks' minimal role in the wholesale 
market almost as a moral failing.  Despite the long civil war in 
Afghanistan, they claim the Afghans are still capable of 
trusting each other.  The informal hawala banking system works 
 
DUSHANBE 00000860  002.2 OF 002 
 
 
quickly and efficiently with little more than someone's good 
word and a phone call to a designated country to deliver the 
promised money, according to the Afghans.  The Tajiks, according 
to Ghaznawi, lack trust and know that they are unreliable even 
to each other.  "They are neither communist, nor Muslim, but 
something in between."  Lack of trust and ambiguous moral values 
have made Tajik society unable to function properly and impede 
business, he said.  The main difference between Afghans and 
Tajiks, according to Ghaznawi and Samay, is that Afghans 
understand risk and how to take care of themselves 
independently.  "War is risk and business is risk - this is 
life." 
 
¶8. (SBU) Moreover, according to Ghaznawi, Tajiks and Afghans 
differ in sales strategies as well. He explained that an Afghan 
will only mark up the price of a product by 20%, but hope to 
sell a lot of them.  A Tajik, however, will take the same good 
and mark up the price by 80%, but only sell a few of them.  It 
was generally agreed among the Afghans that Tajik businesses are 
greedy, do not know how to deal in large volumes, and lack 
management skills.  (Comment:  Post's observations support the 
lack of capacity and ability to handle supply chains or volume. 
End comment.) 
 
Outstanding Problems with Tajikistan Government 
--------------------------------------------- -------------- 
------------- 
¶9. (SBU) The commercial attache and his deputy both bemoaned 
that Tajikistan was not more accommodating to Afghan investors 
and businessmen.  Afghans were not included on the Ministry of 
Foreign Affairs' recently approved list of nations allowed to 
receive visas without invitations at the Dushanbe airport.  It 
chagrined them that they were the most important traders in 
Tajikistan to meet the Tajik population's daily needs and yet 
they were not welcome.  Moreover, getting a Tajik visa in Kunduz 
and Kabul not only takes a long time, it costs $200-$300 more 
than the $60 official rate, even after they show their official 
status as businessmen with business licenses, business 
passports, and proof they paid business taxes in Afghanistan. 
Once Afghan businessmen arrive in Dushanbe, registration costs 
$35 per month.  More than twenty Afghan companies have been 
waiting over a year to register at the Ministry of Justice, and 
have received no explanation for the delay.  They were not too 
concerned about Tajik regulations on imports by "Gosstandart" or 
the lack of a transit agreement between Tajikistan and Pakistan 
and its implications for transit in Afghanistan, since "a 
hundred dollars at the border will fix that." 
 
Brief Biography of Dr. Ata Mohammad Ghaznawi 
--------------------------------------------- -------------- 
------- 
¶10. (SBU) After high school in Afghanistan, Ghaznawi joined the 
Soviet-backed Afghan army and got a scholarship to obtain a 
Ph.D. in economics in Moscow.  He met his future wife at the 
same university.  He moved to Tajikistan in 1988, opened his 
first business in 1990 with $300 of jeans and goods from 
Thailand and Dubai.  Over the next couple of years he traded 
jeans for aluminum ingots from TadAZ (now Talco), among other 
barter transactions, and made a fortune -- so much that he has 
an outstanding business dispute with a Tajik office supply 
company on Rudaki for $7 million dating back to 1991 that has 
yet to be resolved.  (Comment: That's a lot of jeans and 
aluminum. End Comment.) 
 
¶11. (SBU) By 1992, when the Tajik civil war started, he moved 
his family to Almaty, Kazakhstan. He gained refugee status in 
the Netherlands and lived there four years, while keeping his 
businesses running in Tajikistan and Kazakhstan, and then 
finally moved to the United States when his company had a 
contract with the Pentagon.  He received a green card in 2001. 
He said he feels that he has two nationalities - Afghan and 
American - and what he likes most about America is having human 
rights, the freedom to have a business, and protection from the 
law. Still, as an Afghan from a war torn country, he claims that 
he fears nothing.  He is also opening a 240-room hotel in Kabul 
called the Sultan Palace Hotel in a few months. 
HUSHEK