VZCZCXRO4639
PP RUEHDH RUEHDIR
DE RUEHDE #0300 2041248
ZNY SSSSS ZZH
P R 231248Z JUL 09
FM AMCONSUL DUBAI
TO RUEHC/SECSTATE WASHDC PRIORITY 6569
INFO RUEHAD/AMEMBASSY ABU DHABI 3608
RUEHZM/GULF COOPERATION COUNCIL COLLECTIVE
RUEHBUL/AMEMBASSY KABUL 0341
RUEHDE/AMCONSUL DUBAI 9858

S E C R E T DUBAI 000300 
 
SIPDIS 
 
DEPARTMENT FOR NEA/FO; NEA/ARP/BMASILKO 
 
E.O. 12958: DECL:  7/23/2019 
TAGS: ETRD EFIN ECON PREL AF AE
SUBJECT: DUBAI: AFGHANISTAN'S PRIVATE SECTOR IN EXILE 
 
REF: STATE 071311 
 
CLASSIFIED BY: Jennifer Gavito, Acting Principal Officer, 
Consulate General Dubai, UAE. 
REASON: 1.4 (b), (d) 
¶1. (C) Summary:  Acting Consul General, accompanied by PolOff, 
met with Afghan Business Council Chairman Haji Obaidullah Sader 
Khail on July 15. The Afghan Business Council in Dubai was 
established in April 2005 and its 160 members serve as 
Afghanistan's private sector in exile.  About 1000 of 
Afghanistan's 150,000 expatriates in the UAE work in the 
business sector; the remainder fall into the UAE's vast labor 
population.  Afghan businesses have invested USD 10 billion in 
the UAE and, of that, USD 2.5 billion are legally transferred 
from Afghanistan to the UAE. Khail acknowledged the significant 
cash flow from between Dubai and Afghanistan stemming from 
illicit activity, primarily narcotics, and criticized both 
Afghan and UAE efforts to curb the problem.  End Summary. 
 
 
 
-------------------------- 
 
Afghan Business Community 
 
-------------------------- 
 
 
 
¶2. (C) Khail told Acting Consul General that Afghan businesses 
have invested 10 billion dollars in the UAE.  With the lack of 
private security in Kabul (and particularly frequent kidnapping 
and ransom attempts),  Khail said that virtually all major 
Afghan business owners live outside of Afghanistan -- and the 
majority in Dubai.  As a result, Afghan businesses are 
represented in all of Dubai's major business sectors.  Many 
maintain operations in both countries, possible given nine 
flights between Dubai and Kabul daily. Khail, who was openly 
enthusiastic about recent USG efforts to stabilize Afghanistan, 
speculated that once security improves in Kabul, most 
businessmen will move home due to significantly lower operating 
costs than in Dubai. 
 
 
 
----------------------- 
 
Cash Flow and Narcotics 
 
----------------------- 
 
 
 
¶3. (S) Khail was critical of the ease with which cash flows 
between Dubai and Afghanistan, largely in support of narcotics 
trade.  He was dismissive of the UAE's requirement that 
significant cash transfers -- electronic or hand carried -- be 
reported, noting that hawalas, in particular, represent an easy 
workaround.  On the Afghan side, to avoid Central Bank controls 
or scrutiny at Afghanistan's airports, Khail explained that 
couriers drive from Afghanistan to Mashad, Iran and then fly to 
Dubai with their cash. 
 
 
 
¶4. (S) Khail referenced several meetings between the Afghan 
Business Council in Dubai and Afghan President Karzai.  During 
one such meeting, Khail reportedly challenged Karzai to crack 
down on the illicit money transfers as they were undermining the 
reputation of the legitimate private sector.  Khail indicated 
the Council has been less assertive in its advocacy with Dubai 
authorities, although it has encouraged the Dubai Police and 
Customs, particularly at the Dubai Airport, to be more vigilant 
in stopping illegal cash transfers.  Dubai Police remain most 
interested, however, in focusing on sources of illicit trade, 
rather than the relatively small sums of money brought in and 
out of the city by individuals. 
 
GAVITO