carpets sector - itc · 2018. 10. 8. · terms of quality standards, food safety, packaging, buying...

Ministry ofIndustry and CommerceIslamic Republic of Afghanistan

AFGHANISTAN’SNATIONAL EXPORT STRATEGY 2018-2022

CARPETS SECTORA competitive sector blooming with looms

AFGH

ANISTAN

• NATIO

NAL EXPO

RT STRATEG

Y - CARPETS SECTOR •

2018-2022

ITC is the joint agency of the World Trade Organization and the United Nations. As part of ITC’s mandate of fostering sustainable development through increased trade opportunities, the Chief Economist and Export Strategy section offers a suite of trade-related strategy solu-tions to maximize the development pay-offs from trade. ITC-facilitated trade development strategies and roadmaps are oriented to the trade objectives of a country or region and can be tailored to high-level economic goals, specific development targets or particular sectors, allowing policymakers to choose their preferred level of engagement.

The views expressed herein do not reflect the official opinion of ITC. Mention of firms, prod-ucts and product brands does not imply the endorsement of ITC. This document has not been formally edited by ITC.

© International Trade Centre 2018ITC encourages reprints and translations for wider dissemination.

Short extracts may be freely reproduced, with due acknowledgement, using the suggestion citation.

For more extensive reprints or translations, please contact ITC, using the online permission request form:

http: / / www.intracen.org / Reproduction-Permission-Request /

The International Trade Centre ( ITC )

Street address : ITC, 54-56, rue de Montbrillant, 1202 Geneva, SwitzerlandPostal address : ITC Palais des Nations 1211 Geneva, SwitzerlandTelephone : + 41- 22 730 0111Postal address : ITC, Palais des Nations, 1211 Geneva, SwitzerlandEmail : [email protected] : http : / / www.intracen.org

Layout: Jesús Alés – www.sputnix.es

AFGHANISTANNATIONAL EXPORT STRATEGY2018-2022CARPETS SECTOR

This project is funded by the European Union

Ministry ofIndustry and CommerceIslamic Republic of Afghanistan

iii

ACKNOWLEDGEMENTS

The Carpets Strategy forms an integral part of Afghanistan’s National Export Strategy ( NES ). It was developed under the aegis of the Islamic Republic of Afghanistan and the leadership of the Ministry of Industry and Commerce ( MoIC ) and the Afghanistan Chamber of Commerce and Industry ( ACCI ), in close collaboration with the Afghanistan National Standards Authority ( ANSA ) and the Afghanistan Women Chamber of Commerce and Industry. The Strategy benefited from the contribu-tions of sector stakeholders and associations, who played an important role in the consultative process, particularly the Afghan Carpet Exporters Guild ( ACEG ) and the Afghanistan Rugs and Carpet Centre. This Strategy was elaborated thanks to the technical assistance of the International Trade Centre ( ITC ) and falls under the framework of the European Union ( EU )-funded ‘Advancing Afghan Trade: EU Trade Related Assistance’ project.

This document reflects the ambitions of the public and private stakeholders who defined the enhancements and future orientations for the sector with a view to in-creasing export performance and social dividends.

iv

NOTE TO THE READER

Afghanistan’s NES was developed based on a participatory approach during which over 500 Afghan industry leaders, small business owners, farmers and public sector representatives held consultations to reach consensus on key sector com-petitiveness issues and priority activities. These inclusive consultations were held throughout the country, including in Mazar-e-Sharif, Herat, Kandahar and Kabul, with participation of stakeholders coming from Nangarhar Province.

Besides in-depth research and value chain analysis, these consultations were com-plemented by:

� Factory visits through which supply chain assessments were carried out to gain further knowledge on key issues such as quality procedures, technical skills, lean management, quality of raw materials, access to market, etc.

� Interviews with domestic, regional and international buyers to guide the NES with strategic insights and market intelligence as well as buyers’ requirements in terms of quality standards, food safety, packaging, buying cycles, distribution channels, prices, etc.

� Donor coordination meetings to identify synergies with ongoing / planned ini-tiatives of development partners to eventually result in collaboration during the implementation phase.

In spirit and in action: The NES is aligned with existing national and sector-specific plans and policies and builds on ongoing initiatives in areas related to private sector development, regional integration, investment, and youth and women’s economic empowerment.

Equally important, the NES initiative already accommodates budgeting to support implementation of critical pilot activities identified during the design process. This will ensure that impact and momentum are generated from early on, and support further resource mobilization and confidence-building.

v

The principal outputs of the NES Afghanistan design initiative are endorsed, coherent and comprehensive export Strategy documents with a five-year detailed plan of ac-tion ( PoA ) and implementation management framework. These documents include:

1. A main NES document, which contains Trade Support Functional strategies, offering critical support across value chains and acting as enablers for sector development.

2. Individual NES priority sector strategies packaged as separate documents but in alignment with the main NES findings and overarching strategic objectives.

NES Afghanistan

Main NES document comprising Trade Suppor t Functional Strategies:

� Quality management � Trade facilitation � Trade information and promotion � Skills development � Business and professional services � Access to finance

Individual NES priority sector documents:

� Saffron � Fresh fruits and vegetables � Dried fruits and nuts � Carpets � Marble and granite � Precious stones and jewellery

vi

CONTENTS

Acknowledgements v

Note to the reader vi

EXECUTIVE SUMMARY : AFGHAN CARPETS, WEAVING THE TRADITIONAL AND MODERN ERAS 1

STRATEGIC OPTIONS FOR REVIVING THE SECTOR 1

WHAT IS THE TRAJECTORY OF GLOBAL SUPPLY CHAIN ? 5

DEMAND TRENDS : STEADY GROWTH FOR BOTH CONTEMPORARY AND TRADITIONAL CARPETS SEGMENTS 5

SUPPLY TRENDS : REGIONAL POWERHOUSES POSE SIGNIFICANT COMPETITION 7

AFGHANISTAN CARPET VALUE CHAIN : KNOTTY PROBLEMS 9

VALUE CHAIN ANALYSIS 9

STRICT HIERARCHIES AND TRADITIONAL ARRANGEMENTS MARK SECTOR OPERATIONS 13

INPUTS AND PROCESSING STAGES MARKED BY SIGNIFICANT CROSS-BORDER ACTIVITY 14

EXPORT PERFORMANCE : A WINNER WITHIN A WEAK ECONOMY 15

UNSTEADY INSTITUTIONAL SUPPORT HAS LED TO A WEAKENED SECTOR 18

A SERIES OF CHALLENGES PREVENTING SECTOR GROWTH ( THE 3C’S ) 18

AFGHANISTAN’S DILEMMA : TO COPE OR THRIVE? 27

WHAT ARE THE OPTIONS? 27

Scenario 1 : ( baseline scenario ) 27

Scenario 2 : Focus on the traditional / contemporary machine-made segment 27

Scenario 3 : Focus on the traditional, hand-woven, high-end segment, with high differentiation 27

FINDING THE BALANCE THROUGH FOCUS ON TRADITIONAL, HAND-WOVEN, HIGH-END CARPETS 28

MARKETS : ULTIMATELY DEFINING THE STRATEGIC DIRECTION 29

Short-term priorities ( 1–3 years ) 29

Medium-to-long term ( +3 years ) 33

vii

STRATEGIC ORIENTATIONS FOR REVIVING THE AFGHAN CARPETS SECTOR 37

VISION 37

STRATEGIC OBJECTIVE 1 : PRESERVE / CAPTURE INCREASED VALUE AT THE INPUTS AND PROCESSING STAGES OF THE VALUE CHAIN. 37

STRATEGIC OBJECTIVE 2 : ENABLE PRODUCTIVITY ENHANCEMENT OF SECTOR OPERATIONS THROUGH INCREASED COORDINATION AND APPROPRIATE SKILLS UPGRADING. 39

STRATEGIC OBJECTIVE 3 : IMPROVE REGULATORY AND INSTITUTIONAL SUPPORT FOR THE SECTOR. 41

STRATEGIC OBJECTIVE 4 : STRENGTHEN MARKET LINKS AND ENTERPRISE ABILITIES TO FORGE / SUSTAIN BUYER RELATIONSHIPS THROUGH IN-MARKET SUPPORT, BRANDING AND STREAMLINING CUSTOMS PROCEDURES. 43

MOVING TO ACTION 45

KEY REQUIREMENTS FOR EFFECTIVE IMPLEMENTATION 45

Establish and operationalize a public and private coordinating body and executive secretariat 45

STRATEGIC PLAN OF ACTION 47

REFERENCES 59

viii

FIGURES

Figure 1 : Carpet Sector Strategy - Theory of change 3

Figure 2 : Carpet Types, Traditional Afghan carpet type in blue 5

Figure 3 : Major importing countries of carpets worldwide for HS57 ( left ) and HS5701 ( right ) 6

Figure 4 : Price versus differentiation in the global carpet market 8

Figure 5: Main areas of carpet production in Afghanistan 11

Figure 6 : Current value chain 12

Figure 7 : Afghan carpet exports in value, 2005–2016 ( US $ thousands ) 16

Figure 8 : Export basket of Afghanistan ( 2006 ) 16

Figure 9 : Export basket of Afghanistan ( 2016 ) 16

Figure 10 : Classification of exported carpets from Afghanistan 17

Figure 11 : Afghan carpets export destinations, 2006 17

Figure 12 : Afghan carpets export destinations, 2016 17

Figure 13 : Problem tree – challenges to compete 20

Figure 14 : Problem tree – challenges to connect 22

Figure 15 : Problem tree – challenges to change 24

Figure 16 : Price versus differentiation for scenario three 28

Figure 17 : Export potential in Switzerland 32

Figure 18 : Export potential in the UAE 35

Figure 19 : Export potential in the Islamic Republic of Iran 35

Figure 20 : Export potential in Lebanon 35

Figure 21 : Future value chain – strategic objective 1 38




ix

TABLES

Table 1 : Buyers’ requirements for carpets in key markets 7

BOXES

Box 1: Types of carpets produced in Afghanistan 11

Box 2 : Export potential in selected European markets 32

Box 3 : Export potential in selected Middle Eastern markets 34

Box 4 : Export potential in selected Middle Eastern markets (cont.) 35

Source: ITC

xi

ACRONYMS

The following abbreviations are used :

ACCI Afghanistan Chamber of Commerce and Industries

ACEG Afghan Carpet Exporters Guild

ANSA Afghanistan National Standards Authority

ARAZI Afghanistan Independent Land Authority

EU European Union

HS Harmonized System

ITC International Trade Centre

MAIL Ministry of Agriculture, Irrigation and Livestock

MoCI Ministry of Commerce and Industries

MoE Ministry of Education

MoF Ministry of Finance

MoLSAMD Ministry of Labour, Social Affairs, Martyrs and Disabled

NEPA National Environmental Protection Agency

NES National Export Strategy

PoA Plan of action

SMEs Small and medium-sized enterprises

TVET Technical and vocational education and training

UAE United Arab Emirates

Source: ITC

[ EXECUTIVE SUMMARY : AFGHAN CARPETS, WEAVING THE TRADITIONAL AND MODERN ERAS ]

1

EXECUTIVE SUMMARY : AFGHAN CARPETS, WEAVING THE TRADITIONAL AND MODERN ERAS

Afghan carpets are symbolic of the country’s rich heritage, reflecting both the struggles experienced in contemporary times as well as optimism for the future. It is a storied and resilient sector, with industrial potential and a compelling brand proposition. It is one the country’s largest export sec-tors and an employer of more than 1 million Afghans, of which the majority are women.

Indigenous Afghan designs based on traditional weav-ing methods hold a comparative advantage when sold in international markets. Yet, the limited pre and post-weaving processing capacity currently hin ders gains. Foreign suppli-ers are frequently relied on for the provision of critical inputs whereas semi-finished Afghan carpets are sent to Pakistan for the final stages of production ( par ticularly, washing and cutting ) while losing their brand identity in the process.

The sector must capitalize on its unique offering and distinctive reputation to leverage established trade relation-ships with certain European countries and American buyers while exploiting existing ties in the Golf and Asian markets. Besides strengthening market linkages, this will require enabling appropriate skills-upgrading and productivity en-hancement in order to scale-up production capacity and retain value options domestically.

STRATEGIC OPTIONS FOR REVIVING THE SECTORThe Carpet Sector Strategy is driven by the following overall vision :

“ A competitive sector blooming with looms ”

To achieve this vision, the Strategy focuses on four strategic objectives.

Strategic objective 1 : Preserve / capture increased value at the inputs and processing stages of the value chain.

This strategic objective has the goal of repatriating value currently leaking out of the country ( specifically to Pakistan ).

Initial aims of the Strategy are to increase production of Afghan wool in the medium-to-long term, as well as the do-mestic supply of good quality scoured / spun / dyed yarn for traders and weavers. Upgrading existing and development of new cut / wash / dry facilities will be crucial to achieve the goals of retaining value and building a strong Afghan brand.

The Strategy will also support the Government’s ongo-ing efforts to establish industrial parks for the sector. This includes rectifying infrastructural and technical challenges faced in current initiatives.

Strategic objective 2 : Enable productivity enhancement of sector operations through increased coordination and appropriate skills upgrading.

This strategic objective is focused on improving the sector’s abilities through upgrading in-demand skills, as well as tech-nological enhancement of sector operations.

Sound links between the private sector and education and training institutions will facilitate innovation and growth in the industry. The sector will benefit from increased coop-eration among key stakeholders to foster skills upgrades across the value chain. While traditional weaving tech-niques will be preserved, the adoption of technology will spur improvements to sector competitiveness. Promotion of investment in the sector will be a key measure to achieve technological enhancement of sector operations.

Strategic objective 3 : Improve regulatory and institutional support for the sector.

This strategic objective aims to improve the socioeconomic conditions of the weaving community, reduce child labour in the sector, and provide crucial institutional support in the areas of quality management and land access, among other aspects.

2

[ AFGHANISTAN’S NATIONAL EXPORT STRATEGY / CARPETS SECTOR 2018-2022 ]

To gradually counter child labour, the Strategy will bring weaving communities out of isolation into weaving work-shops / centres with better working conditions. Efforts will also be made to increase ‘child labour free’ certifications in the country.

Upgrading the national quality infrastructure is a prerequi-site for the recognition and appreciation of the Afghan carpet brand in international markets. Easing burdensome land regu-lations and streamlining property ownership / leasing will be another focus area addressed by the Strategy. Increasing ac-cess to a more comprehensive range of financial services will also be emphasized, to support improvement of current pro-duction processes and the expansion of the carpet industry.

Strategic objective 4 : Strengthen market links and enterprise abilities to forge / sustain buyer relationships through in-market support, branding and streamlining Customs procedures.

To improve the carpet sector’s position in the global market, it is vital to strengthen market links and enterprise abilities to forge and maintain commercial relationships.

The Strategy aims to expand the export opportunities of Afghan carpet enterprises by improving in-market sup-port services and the dissemination of market intelligence. Strengthening the Afghan carpet brand will also play an es-sential role in this Strategy. The sector will also benefit from the streamlining of export clearance procedures and better communication and cooperation with Customs authorities of neighbouring countries.

Figure 1 captures the carpet sector vision and strategic objectives.

Photo: Carpets, FOX29775.jpg

[ EXECUTIVE SUMMARY : AFGHAN CARPETS, WEAVING THE TRADITIONAL AND MODERN ERAS ]

3

Figure 1 : Carpet Sector Strategy - Theory of change

Change Compete Connect

Vision

An organized and competitive sector with well articulated differentiation in terms of high-quality hand-made carpets catering to high-end markets and highly responsive to buyer requirement

1. Preserve/capture increased value at the inputs and the processing stages of

the value chain

2. Enable productivity enhancement of sector

operations through increased coordination

3. Improve the regulatory and institutional support for

the sector

A competitive sectorblooming with looms

4. Strengthen market links and enterprise capabilities to

forge/sustain buyer relationships through in- market support, branding

and streamlining of Customs procedures

Mitigate value

leakage outside the

country

Incentivize collaboration, facilitate skills development,

enhance productivity

Improveworking

capital and investment

needs

Improve socio-

economic conditions

Enable buyer connectivity and respon-

siveness

Differentiation via high-end hand-made

segment

A stagnant sector facing intense competition and eroding competitiveness and brand equity, despite inherit strengths, specially in weaving and design

• Weak ability to add value in country

• Insufficientpre-and post-weaving facilities to meet industry demands

• Scarce domestic supply ofhigh- quality wool and other critical inputs

• Weak capacity to adapt production to buyer require-ments

• Lack of standardization/irreg-ular quality

• Negative image internationally related to child labour and health issues

• Challenges to connect directly with international buyers

• High dependence of Afghan producers and traders on foreign service providers and merchants

• Afghan carpets labelled as foreign

• Weak organization among producers to initiate direct marketing

• Lack of business/marketing skills

• Institutional support neededon market intelligence, in-market support and branding, transport and logistics

• Insufficient access to credit and land result in low levels of investment

• Weak offer offinancial services

• Skills to innovate,such as design skills, are critically needed

• Lack of links between the private sector and education-al institutionst.

IMPA

CTST

RATE

GIC

OBJE

CTIV

ESSI

TUAT

ION

ANAL

YSIS

STRA

TEGI

C TH

RUST

SIM

PACT

Source: ITC

[ WHAT IS THE TRAJECTORY OF GLOBAL SUPPLY CHAIN ]

5

WHAT IS THE TRAJECTORY OF GLOBAL SUPPLY CHAIN ?

Figure 2 captures the main types of carpets produced glob-ally, segmented by mode of production, fabrication, dye type and material. Afghan carpets fall primarily under the hand-made, knotted, vegetable dye and natural fibre cat-egories ( Harmonized System ( HS ) 5701 ).

Figure 2 : Carpet Types, Traditional Afghan carpet type in blue

Carpets (HS57)

Production

Hand-made

Machine-made

Fabrication

Knotted (HS5701)

Woven (HS5702)

Needle-Punched (HS5703)

Felt-based (HS5704)

Dye

Vegetable-dye

Chemical dye

Material

Synthetic Fibre

Natural Fibre

DEMAND TRENDS : STEADY GROWTH FOR BOTH CONTEMPORARY AND TRADITIONAL CARPETS SEGMENTS

The global carpets sector is exhibiting steady growth, primarily among developed countries. In 2016, world carpet imports stood at US $ 13.6 billion. World imports of woven, decorative carpets ( relevant to types produced in Afghanistan ) were valued at US $ 1 billion in the same year.

6


Figure 3 : Major importing countries of carpets worldwide for HS57 ( left ) and HS5701 ( right )

United States US$2.8 billion

Germany US$1.2 billion

United Kingdom US$1.2 billion

Canada US$741 million

Japan US$569 million

France US$450 million

Australia US$432 million

United States US$324 million

Germany US$80 million

Japan US$24 million

Italy US$20 million

United Arab Emirates US$20 million

Canada US$19 million

United Kingdom US$18 million

Negative growth 2012–2016 ( - ); Medium growth 2012-2016 ( + 0-5 % ); High growth 2012–2016 ( + >5 % )

Source : Trade Map ( 2017 ).

The following key trends have been observed in interna-tional markets :

1. Distributors and retailers are stocking multiple carpet types ( hand-made and machine-made, traditional and modern designs ).

Market demand is not skewed towards a particular segment, especially in the United States of America and EU markets, where the market is large enough to accom-modate different consumer tastes. For this reason, dis-tributors and retailers are increasingly stocking a variety of carpets from different sources.

2. In spite of the rising popularity of modern designs, traditional designs are still in demand.

Modern designs are popular but demand in Western countries for antique and traditional carpets – including traditional, hand-woven high-quality Afghan carpets – has remained stable. Buyers in international markets also appreciate carefully selected materials and up-dated designs inspired by elegant, traditional patterns. This bodes well for Afghan suppliers primarily focused on traditional designs.

3. Rising demand in East Asia.In addition to existing demand in Western markets,

Asian and Middle Eastern markets are exhibiting high demand. The top importer in Asia is Japan, followed by China and the Republic of Korea. National and interna-tional carpet associations have been established in East Asia – predominately in Japan – to promote high-value carpets to high-income East Asian consumers and busi-nesses. Key drivers are the growth of cities, demand from hotels – which are increasingly catering to foreign guests – and increasing consumer appreciation for both traditional and contemporary carpets.

Table 1 indicates the main buyer requirements associated with key markets. The mandatory requirements reflect char-acteristics that must be satisfied before the product can en-ter the market, while the non-mandatory requirements reflect value-enhancing characteristics that can boost price and demand for the product.

Photo: Carpets, www.yashar-bish.com.jpg

[ WHAT IS THE TRAJECTORY OF GLOBAL SUPPLY CHAIN ]

7

Table 1 : Buyers’ requirements for carpets in key markets

Main market Mandatory requirements Non-mandatory requirements

United States

• Flammability standards ( for large carpets )• Labelling requirements ( carpets must be labelled with the letter ‘T’; small

carpets and rugs not meeting the standard must be labelled with the statement : FLAMMABLE )

• General Certificate of Conformity : product complies with all applicable statutes, regulations, rules, bans or standards of the United States Consumer Product Safety Commission

• Other requirements apply for certain types of carpets

• Colour, design, type of fibre and price are important attributes

• Colours : earth or natural tones are popular in the United States market

• Kazaks and Chob Rangs in natural dyes would have a market edge

• Contemporary designs such as gabbehs would have market potential*

EU ( Germany, Italy, France )

• Product safety : under the General Product Safety Directive• Labelling – specific rules for textiles : e.g. fibre composition• Chemical substances : azo dyes are illegal

• Europe : sustainability and certification are important to buyers. For carpets, social aspects such as child labour are major issues. Consumer labels such as GoodWeave, STEP, and Care and Fair are important

• Germany : colour, design, type of fibre, and price are important attributes

• Germany : Chobis in natural dyes, as well as contempo-rary carpets in both bright and earth tones, have market opportunities**

United Arab Emirates

( UAE )• UAE conducts carpet evaluations to assess the real historical and financial

value of the carpet and prevent fake carpets from entering the country• Timely delivery is very important among consumers• Prayer rugs could have market potential

Turkey

• Exporter Registry Form• Certificate of Origin ( English )• European Conformity marking, as required under the Construction

Products Directive ( 89 / 106 / EEC )• Textile and apparel products made available on the market must be

labelled or marked to indicate fibre composition

• Popular trends : modern designs, simplicity and minimalism

• Construction companies, in coordination with architects, decide and buy the flooring for newly built flats in Turkey3

Japan

• Household Goods Quality Labelling Act : carpets for household use require labelling including composition of fibres, name and address or telephone of the party responsible for labelling ( see Textile Goods Quality Labelling Regulations )

• Act on Control of Household Products Containing Harmful Substances• Fire Service Act : flame-retardant standards ( for carpets used in facilities

such as theatres and hotels )• Second-hand Articles Dealer Act ( if carpets are antiques ) • Rising importance of eco-friendly carpets4

* United States Agency for International Development (2006). Building a competitive Afghan carpet value chain through informed strategy and productive attitudes. Breakfast Seminar #16, December 16. Available from https: / / microlinks.org / library / building-competitive-afghan-carpet-value-chain-through-informed-Strategy-and-productive-atti.

** United States Agency for International Development and OTF Group (2006). Growth Strategy and Action Plan for the Carpet Cluster of Afghanistan.

SUPPLY TRENDS : REGIONAL POWERHOUSES POSE SIGNIFICANT COMPETITION

The global supply of knotted hand-made carpets ( including both traditional and contemporary designs ) is dominated by the Islamic Republic of Iran, Pakistan, India, Turkey, China and Nepal.

The Islamic Republic of Iran is the leader in hand-made traditional carpets and holds a premium position in the market due to well-differentiated, high-quality products. Exporters usually sell pieces directly to retailers, and the brand equity commanded by Iranian carpets has allowed

the market to be driven by supply rather than demand. The market has so far readily consumed what the country has supplied.

The sector is currently under strain due to sanctions applied after 2011, leading to the loss of the United States market. Coupled with inflation and in-country shortages, the price advantage of Iranian carpets will decrease to some ex-tent. Although Iranian designs and quality will continue to be recognized by markets based on the established brand, the

http://ec.europa.eu/enterprise/sectors/construction/legislation/transition/index_en.htm

http://ec.europa.eu/enterprise/sectors/construction/legislation/transition/index_en.htm

8


differentiation advantage will also decline due to the lack of design innovation. The erosion of competitiveness has also occurred to some extent due to the Iranian Government’s focus on oil-led growth.

In spite of these challenges, growth continues for Iranian carpets in the European, Russian Federation and Middle Eastern markets, and they still occupy the leading global position in terms of overall competitiveness.

Pakistan is the world’s second-largest exporter of hand-knotted carpets of both domestic and Afghan origin. The latter are mainly chobi carpets that constitute approximately 60 % of Pakistan’s carpet production. A major concern for the Pakistani hand-woven carpet sector is the repatriation of master Afghan weavers. Unlike India or China, Pakistan is less able to upgrade to modern machine-assisted carpet production because of deficiencies in power supply.

The area where Pakistan has an advantage over many of its competitors is the ability to maintain strong links to buy-ers in key international markets. With a tight feedback loop between markets and the domestic carpets sector, Pakistani exporters are able to swiftly adapt to changing market re-quirements. It is expected that they will continue to maintain a strong level of differentiation through production of chobi lines; however, the cost structure may need to adapt to the point where Pakistan loses some cost advantages relative to competitors.

India benefits from concerted Government support and an energetic community of weavers, processors and suppli-ers, which enables the sector to supply a variety of products and customized production. These factors have made India a dynamic supplier of carpets. In recent years, India has made the shift towards contemporary designs, necessitat-ing an upgrade in production and processing techniques. India is seen as a flexible supplier that can quickly respond to changes in consumer preferences.

With the introduction of machine-supported production, India is increasingly moving towards mid-to-low margin, high-volume production. To respond to recent demand, India has increasingly supplied chobi carpets, which has created competition with traditional chobi producing countries.

Despite a Government regulation increasing weavers’ wages, new industries in carpet-making districts have been attracting labour away from established carpet producers. Additionally, the focus on high production in the mid-to-low segment means that India’s price advantage for the hand-woven segment will decrease to some extent, while differ-entiation will increase with the adoption of technology and product development.

The Turkish carpets sector is undergoing a period of introspection. The sector supplies nearby European coun-tries and is built on a reputation for market responsiveness. A mix of challenges including retiring weavers and migration of human capital to other sectors has hurt the sector, which formerly had a high degree of product differentiation as well

as cost advantages. It is likely that this position will be seri-ously weakened in the near future.

In China, central Government planners have prior-itized machine-made over hand-woven carpet production. Production has shifted to machine-made, tufted products which enjoy a strong reputation for good quality at afford-able prices. This emphasis, combined with rising wages, means that China has become less competitive in the inter-national hand-woven market, to the extent that it is now an importer in this segment. Of all competitors, China exhibits potential for a complete withdrawal from the hand-made, knotted segment, leaving the door open for India and others to fill the vacuum.

Nepal is a relative newcomer in the hand-woven car-pet segment, having started in the 1950s with the influx of Tibetan refugees who specialized in contemporary carpets. Exporters have been able to establish relationships in the lucrative United States and German markets, and products are generally well regarded. The ‘Made in Nepal’ brand, combined with the Tibetan influence, has led to an overall profile that is appealing to buyers. Western buyers – initially sourcing from Nepal due to disruptions in supply from the Islamic Republic of Iran and Afghanistan – now buy Nepali carpets due to responsiveness and quality as well as the established brand.

The sector is facing significant challenges, though. Product development is stagnating due to loss of human capital, government indifference and proliferation of ma-chine-made Chinese carpets in the local market. It is ex-pected that rising competition from neighbouring India in the contemporary carpet segment might push Nepal into the higher margin segment of the market. The competition with India and Pakistan suggests a need for product differentia-tion, although it is not clear if Nepal will be able to adapt as swiftly as in the past.

Figure 4 : Price versus differentiation in the global carpet market

Price vs Differentiation

Diff

eren

tiatio

nRe

lativ

e to

eac

h ot

her)

Excellent

Iran

Turkey

India

Nepal

Pakistan

China

ExcellentPoor

Relative position today Likely position within 5 years

Price(Advantage)

Afghanistan

Source : Leahy, Rob ( 2013 ).

[ AFGHANISTAN CARPET VALUE CHAIN : KNOTTY PROBLEMS ]

9

AFGHANISTAN CARPET VALUE CHAIN : KNOTTY PROBLEMS

VALUE CHAIN ANALYSIS

Carpet production

Afghanistan is the home of traditional, high-quality hand-made carpets. According to MoCI, over 1 million Afghans work in the production of carpets, while others work in relat-ed industries such as wool production, cutting, washing and rug design.1 There are some large modern carpet produc-tion hubs supported by the Government; however, home-based producers are responsible for around 95 % of total output. The industry is a great driver of female employment.

Most carpet weaving takes place in rural Afghanistan, while the final product is predominantly sold in urban cen-tres. The majority of Afghan production occurs in the north-ern part of the country, which is the home of traditional and modern carpet design. The carpet production belt in the north, including Mazar-e-Sharif, Sheberghan, Andkhoy, Aqcha and Maimana, accounts for almost 70 % of Afghan carpet output. Kabul, which is the home of traditional carpet showrooms, is a relatively new centre of production. Herat faces declining demand and falling prices, as well as higher costs of labour and inputs. Production in this region has therefore dropped to approximately 5 % of total production.

Afghan carpet weaving has traditionally been a cottage industry. Today, some steps in Afghan carpet production previously done by hand are being undertaken outside the country using cheaper, machine-based methods. For exam-ple, wool processing ( washing, spinning, dyeing ) happens more and more in Pakistan and the Islamic Republic of Iran. Foreign wool ( chobi, Belgian and Pakistani wool ), which is imported and machine-made, dominates the Afghan wool market. The small portion of wool that is processed domesti-cally is produced by hand methods rather than by machine. Chemical colours have gradually replaced traditional natu-ral dyes. It is difficult to estimate how much wool prepara-tion now happens outside Afghanistan and how much is machine-made.

A large quantity of high quality wool is also exported to Pakistan while another share is delivered to weaving

1.– Afghanistan, Ministry of Commerce and Industries ( 2011 ). Implementing the SME Strategy : An Action Plan for Developing Afghanistan’s Carpet Sector.

households. The quality, quantity and style of carpets de-pends on the instructions of the middlemen ( called sub-contractors or carpet traders ) who are connected to large traders. Subcontractors also collect the carpets from weav-ing households. Middlemen provide a link between pro-ducers and exporters. They also control payments made to households and recruitment of weavers to execute the orders. Thus, subcontractors not only connect households to large traders but also create a barrier between producers and the market, leaving little room for weavers to negotiate wages.

Production of carpets in Afghanistan takes place in three distinct ways : profit-sharing, direct buying and sell-ing by weavers, and subcontracting through carpet traders. Profit-sharing is more common in the Faryab market, while subcontracting dominates in Herat. Direct purchase is only found in the Faryab market.

In the case of profit-sharing, the traders provide wool to the weaving households. The wool is considered a loan. Upon completion of the carpet, the trader has the carpet appraised by other traders in the industry. Based on the agreed price, the trader pays the household 50 % of the ap-praised value after deducting the cost of the inputs. The product then belongs to the trader to sell in the market.

Subcontractors also purchase directly from households. In this scenario, weavers have their own looms and enough capital to purchase inputs and produce carpets. Finished carpets are carried to the wholesale market. The price of the carpet is based on the subcontractor’s inspection.

The most common relationship between traders and weavers is subcontracting through carpet traders. The trad-er decides the design of the carpet, purchases the inputs and finds a weaving household to execute the design. After completion, the weaving household delivers the carpet and receives an agreed-upon payment.

Many weavers now organize in workshop spaces rather than working individually from home. This allows them to monitor quality and avoid design plagiarism, which has become more of a problem due to the globalization of the value chain.

10


The main production inputs include the following : � Chemical dyes � Vegetable dyes � Cotton – used in carpet wefts, imported or domestically

provided � Carpet design – indigenous designs are provided domes-

tically but foreign patterns are also used for modern rugs � Silk – some high-end carpets are woven with silk, which

gives a much softer and smoother touch. The availability of domestically produced silk is limited so demand is of-ten met through imports

� Local sheep wool � Chobi wool, Belgian wool and Pakistani wool – imported

The quality of a handmade carpet is measured and de-pends upon the quality of wool, the quality of dye and the knots weaved in 1 inch 2 of a carpet. The more the knots are woven, the heavier its volume and the higher its price. The cost of inputs ranges between 5 % and 21 % of carpet costs depending on the quality of wool and dye used for production.2 High quality dye is imported from Belgium and England. The dyes usually imported from Pakistan are because of being cheaper. Local markets produce natural dyes from pomegranate and herbs, the quality of which are excellent but are in short supply and expensive. Therefore, some dye colors are imported. Imported dyes however vary in quality and are uncertain if they give the right color and touch to the finished wool.

As with dyes, chemicals for cutting and washing is partly imported. Estimates show that 150 tons of caustic soda ( so-dium hydroxide ) is imported from Pakistan on a monthly basis, 90 % of which is used for carpet cleaning. The best quality caustic soda is produced in Lahore and Faisalabad, Pakistan.3 Access to high quality wool is crucial for the qual-ity of the finished good. Approximately two thirds of wool used in the carpet sector is imported, which limits value captured in Afghanistan.4

Carpet Processing

Processing facilities recently opened in Kabul, Mazar-e-Sharif, Jalalabad and Herat. After carpets are woven under subcon-tracting agreements, traders collect them in rural areas and pass them to processors. Local processors cut, stretch, wash and finish the woven carpet. Due to cost efficiency and limited accessibility to domestic processing facilities, the majority of Afghan carpets are sent to Pakistan through Pakistani trad-ers who are connected to Afghan middlemen. Sophisticated Pakistani washing, cleaning, cutting, brushing and packaging facilities are able to finish carpets with enormous cost efficien-cies gained through economies of scale. However, carpets

2.– Ibid.3.– Harakat Investment Climate Organization ( n.d. ) Industrial Analysis Project, Joint Research Program ( co-led by J. Joya and A. Ahmady )4.– Afghanistan, Ministry of Commerce and Industries ( 2011 )

finished in Pakistan are often marketed as Pakistani goods, which damages marketing and branding of Afghan traditional rugs. Limited availability of financial resources, organizational capacity, access to chemicals and lack of expertise in cutting and washing has hindered the expansion of Afghanistan’s domestic processing capacity.

Distribution

Retailers and exporters do not directly interact with weaving households so the value chain is highly hierarchical and fragmented. At the top of the carpet industry hierarchy are exporters and large retailers, who are both large traders and final sellers of the product. Middlemen are both subcon-tractors and traders themselves, collecting carpets from weaving households all over the country before passing them on to processors or larger traders connected to end markets. Estimates show that there is USD 100 million in revolving capital within the industry, with a good proportion of Pakistani investments ( the capital includes wool, dye, wo-ven and unwoven carpets, advances, equipment and frame, receivables and cash ). Some 5,000 companies and brokers are involved, of which up to 200 are registered exporters ( 2015 ). Of these, 90 % work for Pakistani traders.

A limited number of Afghan traders have direct linkage and access to the buyers in the international destinations ( except for Pakistan ). Only a few exporters have showrooms, warehouses or logistics partners in the global markets. Carpets are exported, in most cases, when orders are re-ceived or in exhibitions.

Domestic MarketUnfinished and finished carpets enter the domestic market

through retailers, who get their product through middlemen. Some weavers and middlemen sell unfinished carpets directly on the Afghan market at a lower price. Around 70 % of de-mand in the domestic market is for the traditional Chob Rang.

International MarketAfter carpets woven in Afghanistan enter Pakistan for

finishing, foreign retailers deliver the finished carpets to the international market, informally using the “Bilty” trans-port system. It is estimated that at least 75 % of the total exports are not recorded, a majority of which are destined to Pakistan. Pakistani traders positioned at the border receive carpets from middlemen and sell them on in the Pakistani or international markets. After final processing and transporta-tion, the final sales price in Peshawar is US $ 800–US $ 900 per six square metres. In 2015, Afghanistan exported ap-proximately US $ 90 million of rugs in value. Exact numbers are not accessible as it remains unclear how many Afghan carpets cross the border to Pakistan, from where carpets are sent to other international markets. Top export destina-tions, besides Pakistan, are the United States, Germany and Canada. These markets are showing more and more interest in Afghan carpets. Based on their high reputation,


11

demand for hand-made, traditional Afghan carpets is in-creasing. Marketing of Afghan carpets in these high-end markets has the potential for high growth and creation of jobs in Afghanistan.

In some cases, low quality hand-woven carpets imported from China and Iran are exported to international markets under the label of “Afghan Carpet,” which harms the market reputation of Afghan handwoven carpets.

Box 1: Types of carpets produced in Afghanistan

Three types of hand-woven carpets are produced in Afghanistan – traditional Afghan, Chob Rang and the kazak style ( to a lesser extent ).

• Traditional Afghan carpets are based on indigenous designs and offer a point of differentiation in the international market. The market demand for this type is limited but constant.

• Chobi carpets are primarily commissioned in Pakistan and sold as Pakistani exports. The carpets are woven in Afghanistan and in refugee camps in Pakistan. Despite the inherent loss of value for the Afghan sector after the carpets pass through to Pakistan, this trade relationship, even if unbal-anced, has served to sustain the sector in Afghanistan.

As indicated in figure 5, the main area of carpet production lies in North Afghanistan, while Kabul has emerged as an important production centre for Chob Rang carpets. Kabul is the main sales point for carpets sold in Afghanistan. While production and do-mestic sales figures are not readily available due to data-collection challenges, it is estimated that domestic sales are stagnant due to the sluggish economy, especially for high-end carpets.

Figure 5: Main areas of carpet production in Afghanistan

NorthThe carpet belt in the north is estimated to

account for almost 70% of Afghanistan’s output.

WestHaving faced declining demand, falling prices and higher costs (of both labor and inputs), the carpet cluster in the Herat area is under threat.Estimated to account for 5% of total production.

CenterProduction in the Kabul area is mainly the newer variety of Chob Rung carpets, with a generally higher portion of men weaving than in other regions. Estimated to account for 25% of total production.

Source: All production estimates by Afghan Carpets Exporters Guild, Mazar office. AA; OTF Group Information; 2005

Sheberghan

Aq Cha

Mazar-e-Sharif

Kabul

Maimana

Andkhoy

Herat

Source: OTF Group (2005); Afg

12


Figure 6 : Current value chain

Cutte

rs

Reta

iler

Expo

rter

Repa

irmen

Des

igne

rs

Stre

tche

rs

Fini

sher

s

Was

hers

Cutte

rsTo

tal E

xpor

t USD

90.

2 m

illio

nTo

p Ex

port

Des

tinat

ions

(S

ourc

e Co

mtra

de P

akis

tan:

di

rect

dat

a, re

st m

irror

ed

data

)- P

akis

tan

USD

77.6

mill

ion

- USA

USD

4.9

mill

ion

- Ger

man

y US

D 92

6,00

0- C

anad

a US

D 68

6,00

0- T

urke

y US

D 53

4,00

0- F

ranc

e US

D 39

7,00

0

Repa

irmen

Des

igne

rs

Stre

tche

rs

Fini

sher

s

Was

hers

Cob

Rang

Woo

lSi

lk m

anuf

actu

rers

Impo

rts

of In

put

Inpu

t tra

ders

Proc

esso

rs

Proc

esso

rs

Larg

e tr

ader

s

Paki

stan

iTr

ader

s

Paki

stan

Re-i

mpo

rt

Othe

r Int

erna

tiona

lM

arke

ts

Inte

rnat

iona

l mar

ket

Mid

dlem

en:

Subc

ontr

acto

r/ c

arpe

t tra

der

Dom

estic

Inpu

t- D

esig

n- C

otto

n- C

hem

ical

dye

- Veg

etab

le d

ye

Wea

ving

Hou

seho

lds

- Pro

fit-s

harin

g- D

irect

pur

chas

e- S

ubco

ntra

ctin

g th

roug

h

carp

et tr

ader

s

Reg

ions

• Th

e m

ajor

ity o

f Afg

hani

stan

pro

duct

ion

is lo

cate

d in

the

nort

h:

Her

at, A

ndkh

oy, S

hebe

rgha

n, A

qcha

, Mai

man

a, M

azar

-e-S

harif

,

Kabu

l•

Kabu

l is

a re

lativ

ely

new

cen

tre

of p

rodu

ctio

n, fo

cusi

ng o

n Ch

ob R

ang

carp

ets

• Th

e op

enin

g of

cut

and

was

h fa

cilit

ies

in K

abul

, Maz

ar, J

alal

abad

and

Her

at

Paki

stan

(& Ir

an)

Mac

hine

-mad

e

Prof

it-sh

arin

g

Han

d-m

ade

Profit-sharing

Woo

l man

ufac

ture

rs

Chem

ical

and

nat

ural

dye

man

ufac

ture

rs

Belg

ian

Woo

l

Paki

stan

iW

ool

Loca

lsh

eep

woo

l

Woo

l m

anuf

actu

rers

Nat

iona

l Com

pone

nt

Mix

ed C

ompo

nent

Inte

rnat

iona

l Com

pone

nt

Dom

estic

Mar

ket

- Cho

b Ra

ng c

ompr

ises

70%

of t

rade

d vo

lum

e b

y va

lue

- Afg

han

trad

ition

al c

arpe

ts

Inpu

tsPr

oduc

tion

Asse

mbl

yPr

oces

sing

Dis

trib

utio

nD

omes

tic m

arke

t


13

STRICT HIERARCHIES AND TRADITIONAL ARRANGEMENTS MARK SECTOR OPERATIONS

The market structure of the carpet sector resembles a mo-nopsony, where a few large traders are at the top dominate the sector. These dominant players are almost exclusively male and have sufficient capital and networks to carry on trade. Social and financial barriers to entry contribute to non-competitive behaviour in carpet trading. Moreover, trading networks are often organized along ethnic lines, which in practice further excludes outsiders. This is particularly evident in large-scale trade across specific borders where certain eth-nic groups dominate commerce due to strong relationships in the countries with which they conduct business.

A strong hierarchy characterizes the Afghan carpet value chain, as large traders and exporters do not interact directly with carpet producers. As a result, large traders usually do not have detailed information on the circumstances of car-pet production, including wages paid to weavers and inci-dence of child labour during production.

In Afghanistan, carpet production and trade is mainly done by subcontracting weavers through carpet traders. The role of subcontractors is thus key in the value chain. They provide a link between exporters, large traders and pro-ducers, while commonly working with a network of carpet weavers. In this production ecosystem, the subcontractor is responsible for identifying and contracting the weaver, finish-ing the carpets and then selling them. As finishing services are scarce in the country, Pakistan-based middlemen are often the subcontractors. The responsibilities of the subcon-tractor may include sourcing inputs ( which often includes the loom ) and designs. Thus, if the carpet is destined for the international market, the information regarding size and patterns is transmitted from the buyer to the subcontractor, who passes it on to the weavers. Meanwhile, when carpets are destined for the domestic market, it is the subcontrac-tor who decides the design of the carpet and specifies the desired features to the weavers.

When looms are rented out by the subcontractor, the rental amount is deducted from the wages of the producers or the final price of the carpets. Loans to producers are not limited to renting looms. Additional debts may be accrued in the form of provision of other inputs and advance cash payments. This means the carpet weaver has limited op-portunities to engage with other subcontractors. They are frequently trapped in cycles of debt and tied to subcontrac-tors until the carpet is sold.

Although some bargaining takes place, there are no fixed prices for the final products. Lack of knowledge about the final price is a disadvantage for carpet produc-ers. Subcontractors have the power to decide the payment to the household based on their valuation of the carpets. As producers work in isolation and therefore have limited

access to pricing information and other subcontractors, their bargaining power is restricted. This situation is ag-gravated by the large number of weaving households in the country, which creates pressure on weavers to main-tain productivity in order to preserve business relations with their subcontractors.

The second most common practice in carpet produc-tion and trade is profit-sharing. In this context, the trader provides the raw materials to the producers and then col-lects the carpet on completion. This method occurs when weaving households lack sufficient capital to work indepen-dently of credit. The profit of the carpet is afterwards divided between the producer and the trader. In this arrangement, the trader pays approximately 50 % of the final price to the weavers, deducting the price of inputs. The profit-sharing relationship has become more equitable for weavers since it first started in the 1980s, at which time profits were split 60 :40 in the trader’s favour.

The third and least frequent practice of production and trade is direct marketing of carpets by weavers. In this case, the heads of weaving households themselves sell their car-pets in the wholesale market, where the price is bargained between traders and weavers. In this scenario, weavers have their own looms and sufficient capital to purchase inputs, in addition to having the means to sustain their households during the production. This method is therefore the least common and the number of independent carpet producers is in decline, as capital accumulation is extremely difficult for producers. Notably, in these cases, producers are able to decide the design and quality they wish to produce.

In the case of both subcontracting and profit-sharing, debt – cash or in-kind – is accrued by carpet producers. Further, loans are necessary for carpet production and they stimulate trading of inputs. They are short-term debts, which depend on the duration of the production timeline and trad-ing of the final product. In both scenarios, the main lenders to producers are either subcontractors or traders. This is a result of the limited availability of formal credit tailored to the needs of weavers.

The hierarchical nature of the carpet sector market struc-ture thus allows for a large number of small-scale weav-ers to be locked into trade with subcontractors and traders through debt cycles. Moreover, even when carpet producers are independent and thus able to produce without incurring debt, they still have limited access to large traders in inter-national markets. At the same time, long-standing trading networks ( often forged on the basis of ethnicity ) restrict the ability of new actors to enter into large-scale trading in a sector dominated by a few players at the higher stages of the value chain.

14


INPUTS AND PROCESSING STAGES MARKED BY SIGNIFICANT CROSS-BORDER ACTIVITY

Three large stages are identified in carpet production : pre-weaving, weaving and post-weaving processes. Pre-weaving refers mainly to raw wool processing. Weaving is the actual production of the carpet. Post-weaving refers to finishing processes such as cutting and washing the woven carpets.

Pre-weaving operations require a variety of inputs such as wool ( to be converted to yarn ), chemical and / or natural dyes, and spinning machines, in addition to labour, electric-ity and water. An essential raw material is wool. A variety of sheep breeds are available in Afghanistan but certain breeds are specifically used for wool-to-carpet produc-tion. Furthermore, several types of carpets produced in Afghanistan – for example, gabbeh, Chob Rang and kazak – are created based on the tribal affiliations and / or regions of the weavers.

Certain styles are typically produced with specific types of wool, due to their availability in producing regions and the different qualities they possess. For example, wool originat-ing in the province of Ghazni is considered ideal for carpet weaving. It is often described as ‘soft-hard wool’ and its availability results in a competitive advantage for the Afghan carpet sector. Moreover, Ghazni wool is used to produce the Chob Rang carpet, which is highly esteemed in international markets. Among the sheep varieties producing Ghazni wool, there is the Ghaljai breed, found in the southern provinces of Ghazni and also in Paktia, Zabul and Kandahar.

When the Ghaljai sheep is crossbred with merinos, it re-sults in Baluchi sheep, which are found in Nimroz, Helmand and Kandahar provinces. The Baluchi breed produces good quality carpet wool. Both Ghaljai and Baluchi wools are used to produce the Afghan Baluchi ( also Beluchi ) car-pets and rugs including, notably, the Baluchi prayer rug. Further, Afghan weavers traditionally use the Karakul breed to produce carpets such as the Khal Mohammadi. Finally, the Turki breed is also used for wool-to-carpet production. This breed, found in the western provinces of Afghanistan, creates one of the best-quality wools for carpets.

Although there is domestic production of wool, this in-put is often imported from neighbouring countries such as Pakistan and the Islamic Republic of Iran, since years of conflict and drought, overgrazing of lands and inad-equate livestock management have significantly reduced the livestock population in Afghanistan. Approximately 40 % of the wool used in carpet weaving is domestically pro-duced.5 Certain wool is imported from countries such as New Zealand and Belgium. This wool is considered

5.– Nasrat Sayed and Karimi, Abdul Tamim ( 2016 ). The Afghan carpet industry : issues and challenges. Economic Alternatives, Issue 4.

high-quality wool and appreciated by both the consumer and the weaver. For example, Belgian wool is used to pro-duce Khal Mohammadi carpets. However, given the high transportation costs, wool from the Islamic Republic of Iran and Pakistan is preferred by traders supplying inputs to weavers, despite its poor reputation.

As outlined above, the wool for carpet production is ei-ther domestically produced or imported. When the wool is produced in Afghanistan, the following processes take place either in the country or in Pakistan and the Islamic Republic of Iran. In terms of pre-weaving processing, the first steps are wool scouring and then spinning to turn the wool into yarn. Afterwards, the yarn is dyed with chemical or natural dyes.

Step 1 : Wool scouring removes non-wool contaminants such as grease. Water and some type of detergent are nec-essary to carry out this process. Wool scouring is carried out on a small scale in Afghanistan, which has only a few operating factories dedicated to wool scouring. For this rea-son, raw wool collectors frequently send their products to Pakistan for processing.

Step 2 : Traders often contract with local households to spin the wool into yarn, a process typically performed by women. Since they use hand-spinning methods, their output is small.

Step 3 : After spinning, yarns are dyed with either chemical or natural dyes. Chemical dyes are now frequently used be-cause they are less expensive and the process of dyeing is faster. In the past, only traditional vegetable dyes were used in Afghanistan. Vegetable dyes continue to be used for the production of carpets but only on a minor scale. For exam-ple, they are used in the production of Chob Rang carpets. In fact, Chob Rang means ‘wood colour’ in the Dari lan-guage, a reference to their natural colours. The colour yellow comes from the native plant isparak, a wild form of larkspur. Other natural dyes relevant for the sector are madder roots, indigo, tesu flowers, walnut bark and pomegranate rind.

Because there are few large-scale spinning and dyeing facilities in Afghanistan, traders usually import dyed wool yarn from neighbouring countries, particularly Pakistan and the Islamic Republic of Iran. Production and processing of wool is cheaper in these countries. For this reason, there is a significant reliance on imports, particularly from Pakistani suppliers, for the provision of essential pre-weaving inputs.

In Afghanistan, carpets are predominantly hand-made, traditionally using looms. Their hand-made quality is a distin-guishing attribute that benefits the industry. As stated in the previous section, looms are either rented or owned by the weavers. The looms are divided into two types : horizontal


15

and vertical. Horizontal looms are widely used in rural areas and by nomadic tribes, while weavers living in towns usually use vertical looms. Weaving is an intricate process that can take two to three months for a standard carpet of 2 x 3 m2. The weaving of the carpet begins once the design pattern, also called the ‘map,’ is provided. Other tools used for weav-ing are metal hooks and carpet combs.

When the weaving is finished, the carpet is cut and washed before it is traded in the national or international market. The process of cutting and washing has a substan-tial weight in the value chain, as it represents roughly 30 % of the value of the carpet.6 Washing the carpet requires certain chemicals, such as acetic acid and sulphuric acid, which are predominantly imported from Pakistan. However, they are difficult to source in light of certain import restrictions in Afghanistan related to their dual use for drug production. After the application of tariffs, the import of these chemicals increases the cost of cut and wash operations for Afghan carpet producers.

Furthermore, the number of cut and wash facilities within Afghanistan is insufficient to meet local demand. The ma-chines and materials required for this process are not acces-sible to the majority of carpet producers because they work on a small scale. One Government measure to overcome this challenge has been the construction of industrial parks under the mandate of the Afghanistan Investment Support Agency. These industrial parks offer cutting and washing facilities to businesses. However, they are still limited in num-ber. Moreover, certain issues have prevented companies from joining existing industrial parks, such as the high op-erating costs due to electricity and water shortages. In con-sequence, approximately 85–90 % of producers are forced to send their carpets to Pakistan for finishing processes. Afterwards, many of these Afghan carpets are re-exported under a Pakistani label.

6.– Afghanistan, Ministry of Commerce and Industries ( 2014 ). Investment Opportunities in Afghanistan. Kabul.

For these reasons, Afghanistan depends on Pakistan for the provision of critical inputs and carpet finishing, due to the scarcity of pre-weaving and post-weaving facilities and inputs. This severely inhibits the amount of value addition that can take place within Afghanistan, while also costing Afghanistan countless employment opportunities. Finally, as Afghan carpets are often exported from Pakistan, Afghan traders lose an opportunity to build relationships with inter-national buyers and promote the Afghan carpet brand.

EXPORT PERFORMANCE : A WINNER WITHIN A WEAK ECONOMY

The total export value of carpets from Afghanistan stood at US $ 8.6 million in 2016.7 This figure likely underreports exports of unfinished carpets to Pakistan, considering the rampant smuggling taking place along the Afghanistan–Pakistan border. For this reason, statistical statements in this section should be treated with caution.

7.– HS57, mirrored data based on Comtrade. Direct data : US $ 90 million in 2016.

Carpets are one of the most important export products from Afghanistan besides dried fruits and nuts, fresh fruits and handicraft products. In 2006, carpets represented 28 % of Afghanistan’s export basket. Export of carpets accounted for 2 % of Afghanistan’s export basket in 2016.The combi-nation of products in Afghanistan’s export basket has re-mained similar over the past 10 years.


16


Figure 7 : Afghan carpet exports in value, 2005–2016 ( US $ thousands )

0

2000

4000

6000

8000

10000

12000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016


Figure 8 : Export basket of Afghanistan ( 2006 ) Figure 9 : Export basket of Afghanistan ( 2016 )

Products ofanimal origin

1%

Exported share in 2008

Works of art6%

Edible fruit28%

Vegetable sapsand extracts

4%

Leather4%

Wool1% Articles

of stone1%

Vegetables1%

Oil seeds2%

Spices0%

Other0%

Articles ofleather

0%

Edible fruit52%


Vegetablesaps andextracts

17%

Raw hidesand skins

1%

Furskins1%

Carpets2%

Oil seeds and oleaginous fruits

3%

Edible vegetables5%

Commodities not elsewhere specified

5%

Coffee, tea, spices

7%

Precious or semi-precious

stones8%

Fruit and nuts45%



17

Figure 10 : Classification of exported carpets from Afghanistan

‘5701 knotted

’5702 woven

‘5703 tufted “needle punched”

’5705 Other

‘5704 of felt

0%

0%2%

9%

89%


Most carpets exported from Afghanistan ( 89 % ) are hand-knotted carpets, which achieve the highest price on the in-ternational market. High-quality hand-made carpets based on traditional weaving methods have become increasingly

rare in the international market due to the shift towards ma-chine-supported production. Introduction of machines in the carpet industry made Afghan hand-made carpets an even more precious luxury good in the global market.

Figure 11 : Afghan carpets export destinations, 2006 Figure 12 : Afghan carpets export destinations, 2016


Mexico 1%

Belgium 1%France 1%

Italy 3%

Canada 4%

Switzerland 3%

Norway 3%

Pakistan17% Germany

24%

United Stated32%

Other11%


Other4%

Australia1%

Spain1%

Switzerland1%

Italy1%

UK2%France

5%

Norway1% Belgium

1%

United States58%

Germany11%

Canada8%


18


Other production subcategories in Afghanistan are woven or needle-punched carpets.

� The US and Germany were the top export destinations for Afghan carpets in 2006 and 2016

� 2006 : » Exports to the US : USD 4.6 million » Exports to Germany : USD 887.000

� 2016 : » Exports to the US : USD 4 million » Exports to Germany : USD 1 million

� Reports indicate that another major export destination is Pakistan

� Comparing export destinations in 2006 and 2016, data reveals that export destinations did not change much in the past 10 years

� Afghanistan exports carpets to traditional export destina-tions in Europe and North America

� The only new top export destination is Turkey, according to 2016 data

� Export to Asia and the Middle East are gradually increas-ing, which would diversify Afghanistan’s export destina-tions for carpets

UNSTEADY INSTITUTIONAL SUPPORT HAS LED TO A WEAKENED SECTOR

The development of the Afghan carpet sector is hampered by a lack of institutional support across the value chain. At the production stage, increased institutional support is re-quired to finance enterprises to support business expansion. Quality management and certification services are crucial to allow Afghan carpets to enter high-end markets. Services that connect Afghan enterprises to international markets are particularly needed. The following section details spe-cific functions that are lacking. These services range from

in-market support to investment promotion in foreign mar-kets focused on the carpet sector.

Moreover, the institutional landscape presents coordina-tion challenges that hamper the limited support provided to the sector. For instance, the carpet standardization process suffers from a lack of interaction and coordination among relevant support institutions. Previous overlapping of servic-es has led to side initiatives on standardization. Certification emanating from these side initiatives is not always accepted in international markets.

A SERIES OF CHALLENGES PREVENTING SECTOR GROWTH ( THE 3C’S )

Key issues constraining the sector’s ability to compete, connect and change

The following section analyses sector challenges across three levels: business capabilities; institutional and trade support; and national environment, policy and regulations. Three dimensions of Afghanistan export competitiveness were analysed.

Compete: Issues limiting the sector’s capacity to compete in national and foreign markets. This includes challenges related to access to inputs, productivity, quality management, national infrastructure and compliance with standards, among others.

Connect: Issues restraining connectivity to suppliers, markets and clients. This dimension includes challenges related to mar-ket information, marketing, trade promotion, branding and trade agreements, among others.

Change: Issues limiting the sector’s capacity to change, innovate and tap into emerging trends. This dimension relates to challenges in accessing trained / skilled labour, institutional support to in-novate, investment promotion, corporate social responsibility, and youth and women’s employment, among other issues.


19

As an industry of significant cultural, economic and social importance, the Afghan carpet sector offers significant po-tential for investment and export growth. However, challeng-es related to the sector’s limited post-weaving processing capacity, weak standardization of products, and poor links to international buyers all combine to prevent the sector from achieving its full export potential.

Compete

Limited availability of critical inputs for production and processing of carpets is a major drawback to the competitiveness of the industry.

Some challenges exist for the supply of inputs for both pre-weaving and post-weaving processes. A crucial limiting factor for the production of carpets is the scarce domestic supply of high-quality wool. Years of war and inefficient ani-mal husbandry practices have damaged and disrupted wool production through the loss of grazing lands and diminished domestic breeds of wool-producing sheep. Consequently, most raw wool is imported, primarily from neighbouring countries, where materials are not pure, not graded, and frequently mixed with petroleum products. Quality control of imported wool should be strengthened.

Additionally, the scarcity of medium and large-scale factories producing yarn and increasing difficulty sourcing natural dyes create challenges for the supply of domesti-cally produced dyed yarn, whether the dye used is chemical or natural. It is difficult to access chemicals for washing, i.e. acetic acid and sulphuric acid, due to restrictions on their commercialization which are linked to their dual use for drug production. The limited domestic availability and short shelf life of critical inputs for washing necessitate identify-ing alternative chemicals and / or methods to carry out these activities.

Value chain segment Inputs / production

Severity ● ● ● ● ○

PoA reference Activities 1.1.1 to 1.1.3

Limited processing infrastructure results in limited ability to add value within the country.

Lack of processing infrastructure is the main reason for limited processing capacity throughout the carpet sector value chain. Pre-weaving facilities such as large-scale spin-ning machines and factories to produce dyed yarn are in-sufficient to meet industry demands. The use of traditional, small-scale methods, such as hand-spinning wool, are time-consuming and therefore less efficient.

Another key challenge is the limited availability at the national level of cut and wash services for finishing. Facilities to dry carpets and store them in an environment that is con-trolled for temperature and managed for pest control are also needed. Extremely cold temperatures in certain regions

compromise the drying and proper conservation of carpets. The root causes behind inadequate facilities are low levels of investment due to insufficient access to credit, compli-cated procedures for land acquisition, weak protection of property rights and poor management of industrial parks by the Government.

There are not enough industrial parks focused on the provision of common services and facilities for carpet pro-ducers. Greater availability of finishing services such as cut-ting and washing would be a major asset to the sector, given that the vast majority of small producers are unable to invest in such facilities individually.

Value chain segment All segments

Severity ● ● ● ● ●

PoA referenceActivities 1.2.1 to 1.2.5, 3.4.1, 3.4.2,

3.5.1, 3.5.2

Ability to compete in high-end markets is inhibited by lack of quality control and standardization of production.

Internationally, Afghan carpets compete against Pakistani, Indian, Iranian and Turkish mass-produced carpets. Although Afghan carpets have a high reputation internation-ally, lack of standardization and the irregular quality of final products mar the sector’s positioning and image in global markets. More efforts are required to build and consolidate an Afghan brand for carpets that becomes internationally recognized as synonymous with quality.

Although a system for quality certification of products exists, the fragmentation of production makes training pro-ducers on quality standards and effectively monitoring the quality of final products very challenging. Moreover, existing certification has been created outside any legal framework ( i.e. ACEG certification created outside the framework of ANSA ), which further weakens quality control and carries the risk that existing certification will become meaningless.

Value chain segment Production



Lack of transparency in the taxation system is an obstacle for sector operators.

Sector producers struggle with the lack of transparency in the Afghan taxation system. The lack of clarity sets the stage for administrative corruption. The taxation system needs to be streamlined and domestic investment in processing facilities encouraged through tax incentives, among other measures.


Severity ● ● ○ ○ ○

PoA reference Activities 2.1.4 and 2.4.1

20


Figure 13 : Problem tree – challenges to compete

Insu

ffici

ent

avai

labi

lity

of

dyed

yar

n in

Af

ghan

ista

n,

mos

tly im

port

ed

from

Pak

ista

n

Chem

ical

s re

quire

d to

cut

an

d w

ash

impo

rted

(P

akis

tan)

, hav

e a

shor

t she

lf lif

e

Wea

k pr

oces

sing

/sto

rage

infra

stru

ctur

e lim

its s

cale

of/c

apac

ity to

car

ry o

ut

valu

e ch

ain

activ

ities

Insu

ffici

ent s

tand

ardi

zatio

n an

d w

eak

syst

em fo

r qua

lity

cert

ifica

tion

of

prod

ucts

Lack

of

trans

pare

ncy/

ar

bitra

ry ta

x sy

stem

Lack

of

clar

ity/a

war

en

ess

abou

t ta

xatio

n sy

stem

am

ong

sect

or

ente

rpris

es a

nd

inci

dent

s of

co

rrup

tion

At th

e in

stitu

tiona

l lev

el,

wea

k qu

ality

co

ntro

l and

m

onito

ring

At th

e en

terp

rise

leve

l, in

suffi

cien

t tra

inin

g an

d ex

perie

nce

rela

ted

to q

ualit

y am

ong

wea

vers

Year

roun

d pr

oduc

tion

is

diffi

cult

to

achi

eve.

The

co

untry

has

pe

riods

of v

ery

cold

wea

ther

w

hen

it is

diff

icul

t to

dry

car

pets

Exis

tenc

e of

fe

w lo

cal p

ost-

wea

ving

fa

cilit

ies

(few

cu

t and

w

ashi

ng

faci

litie

s at

the

natio

nal l

evel

)

Insu

ffici

ent p

re-

wea

ving

faci

litie

s to

mee

t loc

al

dem

and

(sca

rce

impr

oved

faci

litie

s fo

r woo

l sco

urin

g,

insu

ffici

ent l

arge

- sc

ale

spin

ning

m

achi

nes,

and

la

rge-

scal

e fa

ctor

ies

to

prod

uce

dyed

ya

rn)

Com

mer

cial

iza-

tion

rest

rain

ed

(issu

es re

late

d to

dru

g pr

oduc

tion)

No la

rge-

sc

ale

spin

ning

m

achi

nes

(use

of

hand

-spu

n m

etho

ds)

Disr

upte

dac

cess

to

chem

ical

s fo

r w

ashi

ng (a

cetic

ac

id, s

ulph

uric

ac

id)

Wea

k av

aila

bilit

y of

sm

all w

oode

n sp

inni

ng

whe

els

Lim

ited

know

ledg

e on

th

e us

e of

sp

inni

ng

whe

els

Insu

ffici

ent

larg

e-sc

ale

fact

orie

s to

pr

oduc

e la

rge

quan

titie

s of

dy

ed y

arn

(whe

ther

usi

ng

chem

ical

or

natu

ral d

yes)

Poor

m

anag

emen

t of

indu

stria

l par

ks

by th

e Go

vern

men

t

Lack

of l

and

for

esta

blis

hing

and

co

nduc

ting

busi

ness

es

Lack

of a

dequ

ate

stor

age

to d

ry

the

carp

ets

afte

r be

ing

was

hed,

an

d to

sto

re

finis

h go

ods

Fram

enta

tion

amon

g su

ppor

t in

stitu

tions

and

la

ck o

f co

oper

atio

n w

ith

the

priv

ate

sect

or

Lim

ited

inst

itutio

nal

capa

city

to

cond

uct c

ontro

l an

d m

onito

ring

(e.g

. and

infra

stru

ctur

e,

tech

nica

l sta

ff)

Diffi

cult

mon

itorin

g si

nce

prod

uctio

n is

ho

me

base

d an

d fra

gmen

ted

Cert

ifica

tions

de

velo

ped

outs

ide

the

fram

ewor

k of

AN

SA (e

.g.

ACEG

)

Insu

ffici

ent

effo

rts

to id

entif

y be

tter s

ourc

es o

f ch

emic

als

or

bette

r che

mic

als

for c

ut a

nd w

ash

proc

esse

s

Insu

ffici

ent a

vaila

bilit

y of

/acc

ess

to c

ritic

al

inpu

ts fo

r pro

cess

ing

(e.g

. was

hing

liqu

id:

natu

ral d

ye, y

arn)

Insu

ffici

ent

supp

ly o

f na

tiona

lly

prod

uced

yar

n.

Yarn

is im

port

ed

from

Pa

kist

an/Ir

an

Com

pete

: Lim

ited

proc

essi

ng c

apac

ity to

sca

le-u

p pr

oduc

tion

and

to p

artic

ipat

e in

hig

her-

stag

es o

f the

val

ue c

hain

re

duce

s th

e co

mpe

titiv

enes

s of

the

Afgh

an c

arpe

t sec

tor


21

Connect

The ability of Afghan enterprises to connect directly to international buyers is inhibited by dependence on foreign value chain actors.

As explained in previous sections, carpet enterprises strug-gle to connect with international buyers because of the high dependence of Afghan weavers and traders on foreign fin-ishing service providers and merchants, as well as foreign input suppliers.

Connections between Afghan carpet producers and international buyers have been lost as a consequence of products being finished and branded as the product of Pakistan, Turkey or whatever country performed the finishing process. Limited direct connections with buyers inhibits the ability of sector stakeholders to understand and adapt pro-duction to market requirements and also slows the growth of an Afghan national brand for carpet exports.



PoA referenceActivities 1.1.1 to 1.1.3, 1.2.1 to 1.2.5, 3.4.1, 3.4.2, 3.5.1, 3.5.2, 4.1.1 to 4.1.4

Producers have limited capacity to organize and initiate commercial relationships.

Weak organization among weavers and lack of business and marketing skills hinder opportunities for weavers to ini-tiate direct marketing and develop expertise to compete in regional and international markets. Institutional support is needed to facilitate the participation of exporters in interna-tional trade fairs and exhibitions. Market intelligence ( e.g. information on high-demand markets, trends in consumer preferences, etc. ) provided to sector enterprises is weak and insufficiently disseminated across the value chain.

Value chain segment Marketing / distribution

Severity ● ● ● ○ ○

PoA reference Activities 2.4.1, 2.4.2, 4.1.1 to 4.1.4

The national capacity to build a brand in foreign markets is hindered because many Afghan carpets are labelled as foreign.

As a result of the limited post-weaving facilities available in the country, a large share of Afghan carpet production ( es-timated to be around 90 % ) is sent to Pakistan for finishing and is subsequently branded as Pakistani. Inefficient border procedures, such as the lack of data collection on traded products, facilitates both smuggling and altering informa-tion about origin. The fact that many Afghan carpets are not labelled as ‘Made in Afghanistan’ creates major challenges in terms of building an Afghan brand and positioning that brand in foreign markets.




Not enough support is provided to Afghan exporters to cre-ate and maintain relationships with international markets.

More institutional support is needed to assist carpet produc-ers to connect with international buyers and maintain com-mercial relationships. Given that many Afghan carpets are exported with a foreign label, it is crucial for Afghan exporters to introduce their products directly to global markets. Support is needed in the form of critical market intelligence on trends and consumer preferences in target markets, in order for sec-tor stakeholders to be more responsive to buyer requirements. Given the strict hierarchical structure of the sector, more ef-forts are needed to disseminate market information to carpet producers through subcontractors and associations to sup-port them in making informed strategic decisions. Additionally, carpet exporters need more support to enable them to par-ticipate in trade fairs and exhibitions, where they can sell their products directly and connect with buyers.




Severe infrastructure challenges and weak institutional ability to streamline the movement of goods across bor-ders are major constraints to accessing distant markets.

Sector development also requires increased institutional support to facilitate the movement of goods across borders. Afghan carpet exporters struggle to access distant markets due to insufficient transportation and logistics facilities. At the same time, exporters are required by developed markets to offer more timely production and delivery.

Using ground transport routes through Central Asia is feasible for exporting to the European market but sea or air transport is required to access markets in North America and East Asia. However, air transport is exceed-ingly expensive and sea transport requires access to either Chabahar Port in the Islamic Republic of Iran or Karachi Port in Pakistan. Support institutions should strive to co-ordinate with neighbouring Customs authorities to stream-line export clearance in cross-border trade, as cargo is frequently delayed and disrupted because of paperwork issues. Exporters face not only the challenge of excessive bureaucracy but also demands for informal payments to Customs officials. More efforts are also needed to negotiate lower shipping rates with international airlines, such as the memorandum of understanding signed with Turkish Airlines in 2015 ( which was never implemented ).



PoA reference Activities 4.3.1, 4.3.2

22


Figure 14 : Problem tree – challenges to connectCo

nnec

t: lim

ited

links

with

inte

rnat

iona

l buy

ers

owin

g to

hea

vy d

epen

denc

y on

fore

ign

trad

ers

and

wea

k in

fras

truc

ture

Wea

k en

terp

rise-

leve

l cap

acity

to

orga

nize

and

initi

ate

com

mer

cial

re

latio

nshi

ps

Natio

nal c

apac

ity to

bui

ld a

bra

nd in

fo

reig

n m

arke

ts is

mar

red

by A

fgha

n ca

rpet

s la

belle

d as

fore

ign

Afgh

an e

nter

pris

es re

lianc

e on

fore

ign

valu

e ch

ain

acto

rs

Insu

ffici

ent s

uppo

rt to

cre

ate

and

mai

ntai

n re

latio

nshi

ps w

ith

inte

rnat

iona

l mar

kets

Poor

tran

spor

tatio

n in

frast

ruct

ure

and

logi

stic

s lim

it th

e ab

ility

of e

xpor

ters

to s

tore

go

ods

and

ship

to o

vers

eas

cust

omer

s

Criti

cal i

nput

s su

ch a

s dy

ed

yarn

are

im

port

ed fr

om

Paki

stan

, tyi

ng

Afgh

an

wea

vers

/trad

ers

to P

akis

tani

m

erch

ants

Loss

of

conn

ectio

n w

ith

inte

rnat

iona

l bu

yers

due

to

Afgh

an p

rodu

cts

bein

g fin

ishe

d an

d br

ande

d as

fo

reig

n (P

akis

tan,

Tu

rkey

)

Wea

k m

arke

ting

skills

am

ong

Afgh

an tr

ader

s

Lack

of

orga

niza

tion

amon

g w

eave

rs

to in

itiat

e di

rect

m

arke

ting

Post

-wea

ving

pr

oces

ses

carr

ied

out i

n Pa

kist

an e

nabl

e ad

ulte

ratio

n of

or

igin

de

nom

inat

ion

Inef

ficie

nt

bord

er

proc

edur

es

allo

w fo

r sm

uggl

ing

of

prod

ucts

(e.g

. la

ck o

f in

form

atio

n co

llect

ion

at th

e bo

rder

)

Wea

k m

arke

t in

form

atio

n se

rvic

es

Lim

ited

mar

ket

prom

otio

n

Insu

ffici

ent

trade

fairs

and

ex

hibi

tions

for

stak

ehol

ders

to

dire

ctly

sel

l th

eir p

rodu

cts

unde

r the

Af

ghan

-mad

e la

bel

Poor

road

in

frast

ruct

ure

(rou

tes

via

Cent

ral A

sia

are

too

slow

fo

r the

Eu

rope

an

mar

ket a

nd to

o co

stly

for t

he

Nort

h Am

eric

an

mar

ket)

No

stre

amlin

ing

of

expo

rt

clea

ranc

e in

cr

oss-

bor

der

trade

Carg

o is

de

laye

d an

d di

srup

ted

due

to p

aper

wor

k is

sues

Insu

ffici

ent

trans

port

atio

n an

d lo

gist

ics

faci

litie

s

Lack

of

perm

anen

t bu

sine

ss

cent

res

in

clie

nt c

ount

ries

limit

the

abilit

y to

sto

ck

prod

ucts

inad

vanc

e

Lack

of

oppo

rtun

ities

to

deve

lop

expe

rtis

e to

co

mpe

te in

re

gion

al a

nd

inte

rnat

iona

l m

arke

ts

Lack

of

stor

age

for

finis

hed

good

s in

key

in

tern

atio

nal

mar

kets

Insu

ffici

ent

abilit

y of

Af

ghan

trad

ers

to m

arke

t pr

oduc

ts

dire

ctly

via

In

tern

et

Lack

of

busi

ness

/mar

k et

ing

skills

Wea

k di

ssem

inat

ion

of m

arke

t in

form

atio

n in

ru

ral a

reas

(e.g

. tre

nds,

pric

es)

Insu

ffici

ent

mar

ket

inte

lligen

ce

prov

ided

to

stak

ehol

ders

(e.g

. new

m

arke

ts, t

rend

s)


23

Change

Investment opportunities are poorly promoted.

Investment opportunities in the sector are not promoted and encouraged enough among potential national and international investors., National and foreign firms are also discouraged by security concerns and an environment of lawlessness. More efforts are needed to promote investment in, for example, cut and wash facilities, by offering not only attractive incentives and investment packages but also extra security measures to reassure investors.




The ability of sector companies to innovate or expand is constrained by the weak offer of financial services to carpet producers.

Carpet producers require access to financing that is tailored to their needs. At present, Afghanistan’s commercial banks have poor incentives to provide loans to carpet producers, as they tend to borrow small amounts of money several times in one year, which is expensive for financial service providers. Land ownership issues also mean producers are incapable of providing collateral. In turn, lack of access to formal capital forces weavers to enter into cycles of debt with traders. This type of loan allows weavers to cover pro-duction costs but not to expand their businesses, as they are unable to accumulate capital.




Limited access to land hinders sector expansion.

Availability of land is a major challenge in Afghanistan, limiting the development of consolidated production sites such as industrial parks. It hinders business expansion into additional processing activities such as the establishment of cut and wash facilities. The current system lacks clar-ity on property rights and land conflict resolution is weak. Moreover, land ownership is highly informal, as there is an almost complete absence of authentic title deeds.




A negative image surrounds the carpet sector due to the prevalence of child labour in carpet production.

The image of the Afghan carpet sector suffers from its rep-utation on child labour issues and the negative effects of weaving on producers’ health. Child labour is very impor-tant for buyers in coveted developed markets, particularly the EU. Although certifications such as GoodWeave and STEP are available in Afghanistan, they have not been used enough and awareness of them needs to be raised. Root causes of child labour in carpet production are economic necessity and social factors. Although some weavers are or-ganized in workshop spaces to increase monitoring, gener-ally such oversight is difficult, as carpet production is largely a cottage industry and large traders usually do not have information about the circumstances of carpet production.



PoA referenceActivities 3.1.1 to 3.1.4, 3.2.1 to

3.2.3, 4.2.2

Limited adoption of new trends and preferences in international markets hinders sector production and export potential.

Certain high-end markets such as the United States and Germany assign great value to design patterns and colours. The sector’s weak capacity to adapt production to con-sumer preferences is partly explained by carpet producers’ isolation from the end market and their limited access to different buyers. The limited range of designs offered by Afghan companies is also due to scarce facilities and lack of computerized technology. Carpet producers have weak design expertise and are not trained to use design software. The latter is partly a result of the lack of formal sector-related training available.




Sector expansion, innovation and sustainability are constrained by the low availability of appropriately skilled labour.

Another fundamental area lacking institutional support is the introduction of sector-specific training in the formal educa-tion system. As a cottage industry, producers are trained in a traditional manner, with knowledge passed from gen-eration to generation. The absence of skills training within the education system creates the risk of losing traditional knowledge passed down within families. Formal training would make higher standardization and scalability of carpet production possible. Lack of such training hinders improve-ments in production and product design.

24


Figure 15 : Problem tree – challenges to change

Chan

ge: C

onst

rain

ed s

ecto

r cap

acity

to in

nova

te a

nd u

pgra

de c

arpe

t pro

duct

ion

and

tap

into

em

ergi

ng tr

ends

Lim

ited

inve

stm

ent

prom

otio

nDi

fficu

lt ac

cess

to c

redi

t lim

its in

vest

men

t in

the

sect

or

Lim

ited

acce

ss

to la

nd h

inde

rs

sect

or

expa

nsio

n

Lack

of c

larit

y on

pro

pert

y rig

hts

(land

ow

ners

hip,

te

nure

)

Poor

ince

ntiv

es

to p

rovi

de lo

ans

as p

rodu

cers

bo

rrow

sm

all

sum

s se

vera

l tim

es a

yea

r w

hich

are

cos

tly

to s

ervi

ce

Wea

k ca

paci

ty to

ada

pt

prod

uctio

n to

the

requ

irem

ents

of

the

inte

rnat

iona

l mar

ket

(des

ign,

col

our a

re im

port

ant

for U

S an

d Ge

rman

mar

kets

)

Nega

tive

inte

rnat

iona

l im

age

ofth

e Af

ghan

car

pet s

ecto

r due

to c

hild

labo

ur

(soc

ial a

spec

ts s

uch

as c

hild

labo

ur a

re

maj

or is

sues

in E

urop

ean

mar

kets

)

Sect

or e

xpan

sion

, inn

ovat

ion

and

sust

aina

bilit

y co

nstra

ined

by

the

low

ava

ilabi

lity

of s

kille

d la

bour

forc

e

Secu

rity

conc

erns

Lack

of

conf

iden

ce in

in

vest

men

t pr

otec

tion

syst

em

Few

effo

rts

to

offe

r ext

ra

mea

sure

s to

re

assu

re

inve

stor

s

Wea

k ab

ility

or c

redi

t w

orth

ines

s to

obt

ain

cred

it

Lack

of

loan

s ex

tend

ed to

ca

rpet

pr

oduc

ers

by

com

mer

-ci

al b

anks

Lack

of

loan

s ex

tend

ed to

ca

rpet

pr

oduc

ers

by

com

mer

cial

ba

nks

Lim

ited

rang

e of

des

igns

and

colo

urs

of c

arpe

ts Wea

k de

sign

expe

rtis

e(d

esig

ns

com

e fro

m

Paki

stan

)

Lim

ited

dire

ct

conn

ectio

ns

with

in

tern

atio

nal

buye

rs to

un

ders

tand

m

arke

t re

quire

men

ts

Insu

ffici

ent

com

pute

rized

de

sign

ce

ntre

s

Cert

ifica

tions

of

non

-chi

ld

labo

ur

stan

dard

s no

t su

ffici

ently

ex

tend

ed

Wea

k en

forc

emen

t of

lega

l fra

mew

ork

rega

rdin

g ch

ild la

bour

Heal

th is

sues

am

ong

wea

vers

, for

ex

ampl

e,

rela

ted

to

dust

, are

als

o im

port

ant

Chan

nels

to

trans

fer

know

ledg

e an

d sk

ills o

f car

pet

prod

uctio

n (i.

e.

wea

ving

) are

in

form

al.

Prod

uctio

n sc

alab

ility

is

diffi

cult

to

achi

eve.

Ris

k of

lo

sing

ski

lls a

nd

know

ledg

e

Trad

ition

al fo

rm

of te

achi

ng,

train

ing

and

skills

de

velo

pmen

t for

th

e ca

rpet

sec

tor

is a

bsen

t in

the

form

al e

duca

tion

syst

em

Diffi

cult

to

reta

in s

kille

d w

eave

rs

(40%

of

expe

rienc

ed

wea

vers

ha

ve le

ft th

e in

dust

ry d

ue

to lo

w

sala

ries)

Need

for

tech

nica

l tra

inin

g on

the

use

of d

esig

n so

ftwar

e

Wea

k tra

inin

g of

ca

rpet

wea

vers

in

desi

gn, b

usin

ess

skills

and

mar

ket

inte

lligen

ce

Wea

k te

chni

cal

assi

stan

ce to

id

entif

y in

tern

atio

nal

cons

umer

re

quire

men

ts

for c

arpe

t w

eave

rs a

nd

desi

gn

cent

res

Conc

erns

ab

out h

igh

inte

rest

ra

tes/

refu

sal

to ta

ke lo

ans

due

to

Isla

mic

be

liefs

Conc

erns

ab

out l

oan

repa

ymen

t ab

ility

Beca

use

prod

uctio

n is

hom

e-ba

sed

in

rura

l are

as, i

t is

diffi

cult

to tr

ain

and

crea

te

awar

enes

s of

inte

rnat

iona

l sta

ndar

ds o

n de

sign

and

col

ors


25

Skills to innovate in the sector, including design skills, will also become increasingly important to improve production and enhance product differentiation. Stronger links are need-ed between the private sector and educational institutions to ensure sector sustainability through the transmission of traditional weaving techniques to young people. Continuous coordination will enable carpet enterprises to rely on a skilled labour pool capable of meeting evolving market demands. Given the cottage nature of the industry, entre-preneurial training should accompany technical training.

The shortage of skilled labour is aggravated by difficulty retaining skilled producers as a result of low weaver salaries. Greater efforts also need to be made to promote employ-ment of skilled migrant weavers returning from Pakistan.





Source: ITC

[ AFGHANISTAN’S DILEMMA : TO COPE OR THRIVE ]

27

AFGHANISTAN’S DILEMMA : TO COPE OR THRIVE?

WHAT ARE THE OPTIONS?

The competition in both traditional and modern types of hand-woven carpets is stiffening. Externally, regional com-petitors such as India, the Islamic Republic of Iran, Nepal and especially Pakistan are better positioned in terms of re-sources and links than Afghanistan, and are better adapted to respond to global trends. Internally, the gears of the value chain are slowing down. Despite this precarious environ-ment, there are strategic options that can be followed to rejuvenate the sector, as outlined below.

SCENARIO 1 : ( BASELINE SCENARIO )

Under this scenario, the dependence on Pakistan will con-tinue to increase, resulting in steadily increasing value leak-age at the inputs and processing stages, and deterioration of brand and export performance. The sector will continue its current operations, which are directed by Pakistani trad-ers in Afghanistan / Pakistan who are closely connected to Pakistani export houses.

With the repatriation of large numbers of Afghan weav-ers from Pakistan, the pressure on the weaving community will increase. The middle-tier traders who typically contract with the weavers will have their negotiating position strength-ened while the bargaining position of weavers will decrease, ultimately depressing wages and living conditions. In this environment, the inherently Afghan design skills and other factors that differentiate the sector will also deteriorate, sped up by anticipated migration of skills to other sectors.

A select few Afghan exporters with political and financial clout will continue to export to international markets; how-ever, these will be vertically integrated islands rather than reflective of the overall sector. The sluggish pace of the do-mestic market will further drive focus on exports.

Over the medium-to-long term, the sector will lose its differentiation edge to a large extent, while becoming mar-ginally more cost-efficient ( and consequently more price competitive ). Cost advantage will come at a price for the already depressed weaving community. Ultimately, the sec-tor will suffer a decline apart from the few larger companies and will become a subcontractor for Pakistan. At that point, the fortunes of the sector will largely depend on the perfor-mance of Pakistan’s carpets sector.

SCENARIO 2 : FOCUS ON THE TRADITIONAL / CONTEMPORARY MACHINE-MADE SEGMENT

This scenario envisages a shift in production from the cur-rent cottage industry to an industrial base with a focus on a mid-to-high volume of carpets priced to compete with their Indian and Chinese counterparts.

The challenge with this scenario is multifaceted. First, the centralized focus that has driven the Chinese and, to a lesser extent, the Indian model will be difficult to achieve due to weak institutional capacity and with the focus of the Afghan Government on other priorities. There is also sig-nificant resistance to regulatory requirements to curtail child labour and to the imposition of minimum wages for weav-ers. Additionally, the essential equipment and technological upgrades required for this model would not be feasible for at least the next 5–10 years. A crucial success factor for this model is market responsiveness and this would take time to emerge. As a result, Afghanistan would not be able to com-pete with the industrial powerhouses of China and India with regards to machine-made carpets, even in the long term.

SCENARIO 3 : FOCUS ON THE TRADITIONAL, HAND-WOVEN, HIGH-END SEGMENT, WITH HIGH DIFFERENTIATION

This scenario adopts a cautious yet comprehensive ap-proach to examining the competitive drivers and challenges faced by the Afghan carpets sector in addition to the overall trends in the carpets segment. The Afghan carpets sector faces a complex dilemma regarding where to position itself in terms of price points and designs.

Proliferation of machine-made carpets from China, which typically do not compete based on quality, is taking place on the global market. Improved technology and productivity levels are also leading to better quality machine-made car-pets. Afghanistan cannot compete with a low-price strategy because of high production costs stemming from a weak

28


business environment and dependency on imports. Also, any price reduction measures will put additional pressure on weavers, causing socioeconomic distress.

The high-end, hand-made, traditional design segment is ideally suited for Afghanistan in the long term. High-end carpets – especially traditional, hand-woven, natural wool

carpets – have a constant and stable demand in the mar-ket, and their value can even increase over time. While the Afghan traditional design is essential to the sector, efforts must be made to cater to the contemporary design seg-ment as well.

Figure 16 : Price versus differentiation for scenario three

Price vs Differentiation

Diff

eren

tiatio

nRe

lativ

e to

eac

h ot

her)

Excellent

Iran

Scenario 3(Selected)

Scenario 2

Turkey

India

Nepal

Pakistan

China

ExcellentPoor

Relative position today Likely position within 5 years

Price(Advantage)

Afghanistan

Scen

ario 1

Source : Leahy, Rob ( 2012 ).

FINDING THE BALANCE THROUGH FOCUS ON TRADITIONAL, HAND-WOVEN, HIGH-END CARPETS

Scenario 3 involves retaining focus on traditional, hand-woven carpets while targeting the higher end of that market in terms of quality and price. The sector can aspire to and make strides in this direction during the Strategy time frame. To accomplish this, the following considerations must be kept in mind.

� Compete on the basis of quality and cater to the high-end market : Afghanistan cannot afford to compete on the basis of price due to inherent deficiencies in the pro-duction structure and business environment, and to avoid additional pressure on the weaving community. Rather,

the future lies with highly differentiated products compet-ing on the basis of quality and traditional / unique designs that appeal to high-end markets, for which there is ample potential.

� Mitigate leakage of value : As long as the inputs supply chain ( machine and hand-spun Afghan wool, chemicals used in treatment, etc. ) remains dominated by imports, the cost of production will remain high. This impacts the bottom line for exporters and ultimately exerts downward wage pressure on the most vulnerable actors in the val-ue chain – the weavers. Similarly, significant value loss is


29

caused by the lack of cut / wash / dry facilities in the coun-try, which is directly affecting the Afghan carpet brand in addition to decreasing export value.

Shifting processing back to Afghanistan, as well as producing more inputs domestically, will increase pro-duction as well as capturing value. By developing supply and value chains on the inputs and processing sides, the sector will reduce dependency on external sources, reduce costs and improve margins, while simultaneously strengthening the Afghan brand.

� Improve production volumes in absolute terms in order to make the sector competitive again. Increasing pro-duction volume will require policy adjustments to main-tain decent wages and working conditions that will attract labour to the sector. It will also require improvements in technology and expertise. In addition, productivity gains would result from reducing isolated weaving operations and instead enabling greater collaboration between weavers, traders and weavers, and exporters and traders, among other relationships. This would involve enabling a mix of integrated models such as weaving cooperatives, shared service centres and industrial parks, while sup-porting traditional models in the short-to-medium term.

� Enable productivity gains through enhanced skills development and improved methods and models of pre-weaving, weaving and post-weaving activities. Productivity gains will be accompanied by socioeco-nomic dividends for weavers ( women workers ) and other stakeholders in the value chain. Limited innovation oppor-tunities in neighbouring Pakistan will result in expanded opportunities for Afghanistan.

� Gradually develop competencies in the contemporary design segment. Competition in the contemporary seg-ment from India, Nepal and Pakistan is high. Afghanistan will not be able to compete in the near term, as market links take time to be strengthened. Over time, Afghan

carpet producers will be able to enter this market, primari-ly through lead firms that demonstrate success and serve as case studies for other companies. However, this is a long-term objective. Afghanistan is already competent in the Chob Rang segment, and this can be nurtured and expanded to contemporary design abilities in the future.

� Meet financing and investment needs : The sector is in dire need of private / public financing as well as work-ing capital. This problem will need to be resolved before growth can occur. In the short term, donor or govern-ment sector funding will be required in addition to existing informal financing options. In the medium-to-long term, private sector commercial funding and buyer-financed working capital funding can take over.

� Improve developmental considerations : By improving the socioeconomic conditions of weavers, the majority of whom are women, and resolving to end the use of child labour, the sector will not only benefit from a so-cioeconomic and developmental perspective but also from the international access that certifications such as GoodWeave bring.

� Develop relationships with buyers and improve respon-siveness to their evolving needs : Beyond maintaining quality and on-time order fulfilment, Afghan carpet ex-porters must be flexible in adapting to client needs and requirements. For example, if a wholesaler in the United States requests a particular design, the supply base must be flexible enough to cater to that request. This also en-sures that forward integration can potentially take place, involving supply of working capital from a buyer based on relationship trust levels.

� Open air cargo corridors with India, and the US : Such corridors would provide an avenue for developing on-time delivery of goods to these markets and at the same time reduce dependence on Pakistan.

MARKETS : ULTIMATELY DEFINING THE STRATEGIC DIRECTION

The following analysis is divided into two broad phases : one related to the immediate, short-term perspective and the other to the medium-to-long term outlook, when it is expected that a significant portion of the NES and the sec-tor PoA will have been implemented. This phased approach is aimed at alignment with the evolving capacities of the sector’s trade and investment support institutions and en-terprises as NES implementation moves forward.

SHORT-TERM PRIORITIES ( 1–3 YEARS )

Short-term priorities are product–market combinations which are exporting well but could either : a ) be better per-forming in existing markets with implementation of shorter-term improvements recommended in this Strategy; or b ) be translated into quick success with promising markets through variations on successful products.

30


Domestic market

Afghanistan produces around 2 million square metres of car-pets annually, of which the majority is exported to Pakistan, Europe, the United States and Asia. Some merchants have established direct contacts with Western importers and dealers to achieve higher prices.

Only a small portion of demand comes from domestic buyers. Domestic demand comes from high-income house-holds, public facilities and hotels, mainly in major Afghan cit-ies. Carpets are sold domestically in local bazaars, including traditional outlets and Kabul’s famous Chicken Street retail-ers. Carpet centres in Jawzjan, Herat, Nangarhar and Kabul, as well as showrooms in major Afghan cities, are the most important domestic distribution channels.

Pakistan

Pakistan is strategically important because it is the major export destination for unfinished Afghan carpets. It is esti-mated that more than 80 % of high quality carpet produced in Afghanistan is sold to Pakistan on less attractive prices. The majority of exports to Pakistan are for value addition purposes rather than exports of finished goods. Pakistani traders in Afghanistan export the majority of Afghan handi-crafts and have direct contacts with weaving households. Carpet producers mostly work with Pakistani markets, get raw materials from them, distribute the raw materials to the weavers, in many cases they get advances from the Pakistani traders and pay advances to the weavers.

Based on the tight trade relationship and existing ties to carpet production, the Pakistani market will continue to be an essential destination for Afghan carpets in the future. The difference will be that finished rather than unfinished carpets will be exported in the medium-to-long term, thus retaining value and brand equity for Afghanistan. In the short term, however, the current links through which Afghan weavers function as contractors will serve to keep the Afghan carpets sector buoyant, and therefore the link will remain important in the interim until sector capabilities are built.

In order to strengthen exports of Afghan carpets to the consumer market rather than for value addition pur-poses, the following considerations will be particularly important :

� Monitor the value addition of Afghan carpets and reimport to enhance branding under the Afghan name.

� Gradually substitute foreign value addition with do-mestic value addition in order to export finished in-stead of unfinished goods.

� Target niche markets in Pakistan and focus on ex-port of unique, hand-made traditional carpets.

Target market Market segment Distribution channelAfghan carpet exports

in 2016 ( US $ )Annual growth of sector

imports ( 2012–2016 )

Pakistan

Private carpet traders, resellers, households,

value addition facilities

Export traders in Afghanistan, retailers, private carpet weaving

households with contacts in Pakistan 90 million* - / -

* Based on Direct Data on Comtrade as Mirror Data is not available in the Statistics. Source : Trade Map ( 2017 ).

Europe ( focus on Germany )

Germany is the host and organizer of DOMOTEX, the car-pet sector’s primary international carpeting and flooring trade fair. The country has shown great interest in hand-made carpets from Afghanistan and has established trade relationships with Afghan carpet exporters. As the host na-tion of DOMOTEX, Germany has a high regard for Afghan carpets. This was reflected when Afghan carpets won the Carpet Design Award – the ‘Oscar’ of the carpet industry – at DOMOTEX in Hanover in 2008, 2009 and 2014. According to United Nations Comtrade data, Germany imported

US $ 926,000 of carpets from Afghanistan.8 However, since 2012 exports to Germany have declined 15 % annually due to competition from the Islamic Republic of Iran, India and Turkey. Nevertheless, based on export experience, the high reputation of Afghan carpets is now recognized in neigh-bouring European markets such as France, the United Kingdom of Great Britain and Northern Ireland, Norway, Italy, Belgium, Switzerland and Spain. The European market thus brings the best opportunities for market diversification in the short run. Europe reports overall stable demand despite the decline in exports to Germany.

8.– Based on Mirror Data on Comtrade, 2016


31

In 2016, the EU imported around 43 % of the total value of world carpet imports, which makes the region the largest carpet consumer. The European market is an important ex-port destination due to its recognition of Afghan carpets as a high-end product, along with the market’s willingness to pay high prices for hand-made, high-quality products. Afghan carpets tend to achieve higher prices in European markets, where prices start from US $ 250 per square metre. Many households, as well as hotel chains, restaurants and other facilities, demand traditional and decorative Afghan carpets. Afghan carpets are mainly distributed through specialized carpet retailers in large European cities as well as whole-salers trading oriental carpets. Many wholesalers, such as Akbar Trading GmbH, or AWT Trading GmbH, are located in Hamburg, Germany, and act as a pipeline to the European market. In addition to the long-established distribution chan-nels, online supply companies have started to emerge as another popular source for distribution.

To maintain recognition of Afghan carpets in the European market and compete against other oriental carpets, the following considerations will be important :

� Establish the Afghan carpet as a hand-made, high-end brand to compete against machine-made, cheaper carpets from other countries.

� Follow product safety standards under the General Safety Directive and improve labelling of fibres and chemical substances.

� As quality, origin and social issues are important to European buyers, attach certificates assuring, for example, that child labour was not used in pro-duction ( labels such as GoodWeave, STEP, Care & Fair ).

� Follow design trends in this dynamic market and update designs, colours and type of fibre frequent-ly, especially when targeting the German market. » Chobi rugs in both bright and earth tones

showed high market opportunities.

Target market Market segment Distribution channelAfghan carpet exports

2016 ( US $ )Annual growth of sector imports 2012–2016 ( % )

Germany

Private households, hotels, restaurants, and other

facilities Wholesalers, retailers

926 000 -15

France 397 000 71

United Kingdom 208 000 34

Norway 110 000 -4

Italy 106 000 40

Belgium 72 000 - / -

Switzerland 71 000 0

Spain 70 000 2


Photo: Carpets, Afghanistan Matters, Beauty Upon Beauty.jpg

32


Box 2 : Export potential in selected European markets

The ITC export potential assessment revealed that Switzerland is an interesting market for Afghan carpets. The market has hardly been explored yet, as over 85 % of the full export potential remains unrealized. Afghanistan has a small tariff advantage in the Swiss market. The unit value relative index is 0.9, indicating that Afghan carpets are imported at a lower price than carpets from competitor

countries. The Swiss market is expected to grow over the next few years. However, Afghan carpets need to undergo inspections and seek special authorization, register and obtain an export certifi-cate for the Swiss market. If Afghanistan is able to overcome this hurdle, Switzerland is a high-potential market.*

Figure 17 : Export potential in Switzerland

Switzerland: HS 570110 – Carpets and other textile floor coverings, of wool or fine animal hair, knotted, whether or not made up

UNTAPPED EXPORT POTENTIAL

APPLIED TARIFF

COMPETITION

Concentrated

equivalent suppliers

Main suppliers: Iran, Germany, India

MARKET ENTRY REQUIREMENTS

UNITED VALUERelative index: 0.9

DEMAND

USD 25.1 mn2011-2015

2020

13%

USD 470 tsd

• Custom inspection, processing and servicing fees

(https://www.admin.ch/opc/fr/classi-fied-compilation/19850243/index.html)

• Special authorization requirement for SPS reasons


• Product registration requirement• Certification requirement• Inspection requirement


Afghanistan: 0% Ø other suppliers: 1%Tariff advantage: 1pp

Source : ITC ( 2017 ) : Reconnecting Afghanistan to global markets – An ITC assessment of export potentials and

trade obstacles.

* ITC (2017) - Yvan Decreux, Maria Del Mar Cantero and Julia Spies: Reconnecting Afghanistan to global markets –

An ITC assessment of export potentials and trade obstacles.


33

North America ( United States )

Exports to the United States increased from US $ 2.9 mil-lion in 2012 to US $ 5.0 million in 2016. Demand rates indi-cate that exports have the potential to increase to US $ 40 million.9 Afghan carpets first became popular as a sou-venir brought home by returning American soldiers and the Afghanistan / United States Carpet Conference held in Dubai in 2012 contributed to the popularity and reputation of Afghan carpets in the United States. Many Afghan carpet companies have already established strong ties and even opened showrooms and trading offices in the United States. To increase the reputation of Afghan carpets, there are even companies such as Ariana Rugs that issue licences for certified child-labour-free rugs made in Afghanistan. Such initiatives significantly contribute to export opportunities for Afghan carpets, as reflected in the increasing export value to the United States. Looking at the last five years, the United States has shown a positive trend in carpet imports, with an annual growth rate of 7 %. In 2016, Afghan carpet exports to the country reached a remarkable US $ 5 million.

Similar to the European market, primary North American market segments include residential households, hotel chains, restaurants and other facilities. Carpets exported to the United States are usually sold at a cheaper price

9.– Leahy, Rob ( 2012 ). Understanding the market for Afghan rugs, November 7. Available from www.charlestonrugsblog.com / 2012 / 11 / 07 / understanding-the-market-for-afghan-rugs / .

( average US $ 150 per square metre ) than in the European market, as not only very high-end products but also medi-um-quality carpets find buyers in this market. Specialized carpet retailers and wholesalers trading in oriental carpets serve as the main distributors of Afghan carpets in the coun-try. The majority are located in the San Francisco Bay area. In addition to established distribution channels, online sites have started to emerge as another popular way to access Afghan carpets.

To penetrate the United States market, the following considerations will be important :

� Meet flammability and labelling standards for large carpets.

� Consider the General Certificate of Conformity, which ensures that a product complies with all ap-plicable regulations and standards of the United States Consumer Product Safety Commission.

� Follow colour, design, type of fibre and price trends, as these are important indicators for exports : » Kazaks and Chob Rangs in natural dyes of earth

and natural tones have market edge. » Contemporary designs such as gabbehs show

market potential.

Target market Market segment Distribution channelAfghan carpet exports 2016

( US $ )Annual growth of sector

imports ( 2012–2016 )

United States

Private households, hotels, restaurants, and other

facilities Wholesalers, retailers 5 million 16 %


MEDIUM-TO-LONG TERM ( +3 YEARS )

The markets listed in the short-term section above also have export potential in the medium-to-long term, unless speci-fied otherwise. However, additional market research, product development and Strategy implementation would be re-quired and is unlikely to be completed in less than two years.

Japan

Japan is showing increasing interest in oriental rugs, includ-ing Afghan carpets. A select few leading Afghan firms have started to establish a foothold in Japan. Japanese carpet im-porters have also tested imports of Afghan hand-made prod-ucts. The majority of Afghan carpets reach Japanese buyers through wholesalers and retailers based in Tokyo who have di-rect contacts with Afghan export traders or carpet enterprises.

The market for Afghan carpets in Japan is currently small; however, there are significant opportunities. Japan imported US $ 569 million in carpets in 2016, compared with US $ 520 million 10 years ago. Afghanistan has been increasing its export share in Japan with an annual increase of 11 % since 2012, with exports reaching US $ 28,000 in 2016.

By establishing further ties with the Japanese market, Afghanistan has a great chance to increase its exports to Japan in the medium term. The market includes not only high-income buyers in private households but also major hotel chains, shops, boutiques and restaurants.

Most carpet retailers in Japan offer online sales, which could be expanded for the East Asian market. Additionally, strengthening visibility through participation at trade fairs in Japan would help to establish the reputation of Afghan carpets in Asian markets.

http://www.charlestonrugsblog.com/2012/11/07/understanding-the-market-for-afghan-rugs/


34


To penetrate the Japanese market, Afghan carpet ex-porters should consider the following :

� Respect the Household Goods Quality Labelling Act for carpet sales for household use, which re-quires labelling the composition of fibres as well as the name, address and telephone number of the party responsible for labelling.

� Align with the Textile Goods Quality Labelling Regulations.

� Fulfil requirements of the Act on Control of House-hold Products Containing Harmful Substances and the Fire Service Act for flame-retardant standards, especially for carpets used in public facilities.

� Market the eco-friendliness of production, as this is an area of increasing interest.

Canada

Based on existing ties with the United States market, there are spillover effects to the Canadian market. Expansion of online marketing in the United States simultaneously con-tributes to market penetration in Canada. North American countries import 29.5 % of carpets globally, which makes them the second-largest carpet-importing bloc in the world. Canada imported US $ 686,000 of Afghan carpets in 2016. Imports of Afghan carpets have increased 9 % annually since 2012. Similarity to the United States market allows exports to be distributed to the Canadian market through existing American marketing channels. Given positive export trends

and established trade links, Canada is a promising export destination in the medium term. Once Canadian carpet trad-ing hubs are established, trading channels with Afghanistan can be strengthened. Target buyers are high-income house-holds, hotel chains, restaurants and other facilities.

Middle East

Carpets are historical symbols of wealth in Middle Eastern culture and Middle Eastern consumers understand the val-ue of hand-woven carpets. The high-end luxury industry, to which carpets belong, is flowering in the region. Exports to the UAE have been slowly increasing over the past 10 years, with Afghan hand-made carpets steadily building a high reputation for quality. Exports in 2015 were valued at US $ 527,000. Market penetration in the UAE can open the door to the Middle Eastern market, which shows increasing interest in carpets.

India

As one of the most important export destinations for Afghan products, India is a potential export market for the Afghan carpet industry. Afghan carpets are not yet established in the Indian market, which is unsurprising considering that India has its own prominent domestic carpet industry that satisfies most local demand. Nevertheless, this does not mean that Afghan carpets cannot penetrate the Indian market, espe-cially when making use of the recently established air cor-ridor between the two countries. Strong existing trade ties in India will also help to establish the reputation for hand-woven Afghan carpets. Adding carpets to the existing export basket to the Indian market would help Afghanistan to diversify its exports to one of its most important export destinations.

Box 3 : Export potential in selected Middle Eastern markets

The UAE has been revealed as the main market with untapped potential, with over 47 % of its US $ 3.7 million export potential still unrealized. Emirati importers are increasing imports of carpets. Current imports of US $ 49.2 million are expected to increase by 22 % until 2020. Afghan products are imported at a cheaper price than competitor products. To realize the great export potential in the Emirati market, Afghan exporters have to overcome various non-tariff measures, ranging from sanitary and phytosanitary issues to labelling requirements.

The Islamic Republic of Iran is another attractive market for Afghan carpets, with an unrealized potential of US $ 1.5 million. Despite

Afghanistan facing a high tariff of 50 %, it does not suffer from a tariff disadvantage as other competitors also face a 50 % average tariff. The Iranian market has a positive outlook with expected growth of 18 % by 2020.

The Lebanese market is another hardly explored market with an unrealized export potential of over 85 %, even though Afghan carpets are imported at a higher price than their competitors’ products. Nevertheless, Afghan carpet exporters can benefit from the growing Lebanese market in the future and establish the Afghan brand by penetrating an untapped market opportunity.*

* ITC (2017) – Yvan Decreux, Maria Del Mar Cantero and Julia Spies: Reconnecting Afghanistan to global markets

– An ITC assessment of export potentials and trade obstacles.


35

Box 4 : Export potential in selected Middle Eastern markets (cont.)

Figure 18 : Export potential in the UAE

United Arab Emirates: HS 570110 – Carpets and other textile floor coverings, of wool or fine animal hair, knotted, whether or not made up

MARKET ENTRY REQUIREMENTS

UNTAPPED EXPORT POTENTIAL DEMAND

USD 1,763 tsdUSD 49.2 mn2011-2015

2020

22%

APPLIED TARIFF

Note: information on non-tariff measures and unit values is not available for all countries.

Afghanistan: 5% Ø other suppliers: 5%

Tariff advantage: 0pp

COMPETITION

Concentrated


Main suppliers: Iran, India, Afghanistan

• Special authorization requirement for SPS reasons • Certification requirement• Prohibition for TBT reasons• Authorization requirement for TBT reasons• Import monitoring and surveillance requirements and other automatic licensing measures• State trading enterprises, for importing• Registration requirements for importers• Storage and transport conditions • Product registration requirement• Inspection requirement• Requirement to pass through specified port of customs• Import monitoring and surveillance requirements and other automatic licensing measures• Labelling requirements

(Original documents available at www.macmap.org) UNITED VALUERelative index: 0.8

Figure 19 : Export potential in the Islamic Republic of Iran

Iran: HS 570110 – Carpets and other textile floor coverings, of wool or fine animal hair, knotted, whether or not made up


USD 1,586 tsd

USD 7.8 mn2011-2015

2020

18%

APPLIED TARIFF



COMPETITION

Concentrated equivalent suppliers

Main suppliers: Germany, United Arab Emirates, Italy

Figure 20 : Export potential in Lebanon

Lebanon: HS 570110 – Carpets and other textile floor coverings, of wool or fine animal hair, knotted, whether or not made up


USD 225 tsdUSD 9.1 mn2011-2015

2020

15%

APPLIED TARIFF



COMPETITION

Concentrated


Main suppliers: Iran, Pakistan, IndiaUNITED VALUE

Relative index: 5.6

Source : ITC ( 2017 ) : Reconnecting Afghanistan to global markets

– An ITC assessment of export potentials and trade obstacles.

Source: ITC

[ STRATEGIC ORIENTATIONS FOR REVIVING THE AFGHAN CARPETS SECTOR ]

37

STRATEGIC ORIENTATIONS FOR REVIVING THE AFGHAN

CARPETS SECTOR

VISION

The Afghan carpets sector is united by the following vision :

“ A competitive sector blooming with looms ”

In order to fulfil this ambitious vision and the bottom lines described above, the following strategic objectives have been identified. These objectives provide a framework for developing solutions over the next five years. They are as follows.

STRATEGIC OBJECTIVE 1 : PRESERVE / CAPTURE INCREASED VALUE AT THE INPUTS AND PROCESSING STAGES OF THE VALUE CHAIN.

This strategic objective has the goal of repatriating value cur-rently leaking outside the country ( specifically to Pakistan ) through the inputs and processing stages of the value chain.

On the inputs side, the paucity of high-quality, well-treat-ed domestic wool has created a dependence on imports that is untenable. Afghan wool – especially from Ghazi – is of high quality but supply is weak. For this reason, the mar-ket is dominated by imports of high-quality and expensive wool from Belgium and relatively low-quality and cheap-er wool from the Islamic Republic of Iran and Pakistan. Recommendations to address this situation include estab-lishing shared service centres that can supply good quality scoured / spun / dyed yarn to traders and weavers, and pro-viding assistance to sheep breeders in the area of animal husbandry, enabling them to increase the volume of Afghan wool in the medium-to-long term.

To achieve the goals of value retention and building a strong Afghan brand, it is imperative that the cut and wash finishing process is brought back to Afghanistan. Currently, 90 % of Afghan carpets are sent unfinished to Pakistan for

a combination of reasons, which include Pakistani exper-tise in finishing, readily available chemicals for finishing, processing facilities, low cost of labour, year-round warm weather and the proliferation of Pakistani traders that have established networks in international markets. These carpets – primarily from the Chob Rang line – do not carry the Afghan brand once they are finished and shipped.

To counter this significant leakage of value outside Afghanistan, support for upgrading existing cut / wash / dry facilities and developing new ones will be proposed, both through integrated production facilities ( such as the shared service centres mentioned above or the industrial parks be-ing established by the Government ) and through individual enterprises. The development of these valuable services will increase the number of carpets finished within the country ( around 5 % at present ), which will, in turn, retain value inside the sector and spur job creation and a rise in income. The Strategy will also support the Government’s ongoing efforts to establish industrial parks for the sector, in particular by re-viewing and rectifying infrastructural and technical challenges.

38


Figure 21 : Future value chain – strategic objective 1

Inpu

tsPr

oduc

tion

Asse

mbl

yPr

oces

sing

Dis

trib

utio

nD

omes

tic m

arke

t

Cob

Rang

Woo

lSi

lk m

anuf

actu

rers

Impo

rts

of In

put

Paki

stan

(& Ir

an)

Woo

l man

ufac

ture

rs

Chem

ical

and

nat

ural

dye

man

ufac

ture

rs

Belg

ian

Woo

l

Paki

stan

iW

ool

Inpu

t tra

ders

Mac

hine

-mad

e

Prof

it-sh

arin

g

Profit-sharing

Han

d-m

ade

Mid

dlem

en:

Subc

ontr

acto

r/ c

arpe

t tra

der

Wea

ving

Hou

seho

lds

- Pro

fit-s

harin

g- D

irect

pur

chas

e- S

ubco

ntra

ctin

g th

roug

h

carp

et tr

ader

s

Cutte

rs

Repa

irmen

Des

igne

rs

Stre

tche

rs

Fini

sher

s

Was

hers

Proc

esso

rs

Reta

iler

Expo

rter

Larg

e tr

ader

s

Dom

estic

Mar

ket

- Cho

b Ra

ng c

ompr

ises

70%

of t

rade

d vo

lum

e b

y va

lue

- Afg

han

trad

ition

al c

arpe

ts

Reim

port

Cutte

rsTo

tal E

xpor

t USD

90.

2 m

illio

nTo

p Ex

port

Des

tinat

ions

(S

ourc

e Co

mtra

de P

akis

tan:

di

rect

dat

a, re

st m

irror

ed

data

)- P

akis

tan

USD

77.6

mill

ion

- USA

USD

4.9

mill

ion

- Ger

man

y US

D 92

6,00

0- C

anad

a US

D 68

6,00

0- T

urke

y US

D 53

4,00

0- F

ranc

e US

D 39

7,00

0

Repa

irmen

Des

igne

rs

Stre

tche

rs

Fini

sher

s

Was

hers

Proc

esso

rs

Paki

stan

iTr

ader

sPa

kist

anOt

her I

nter

natio

nal

Mar

kets

Shar

ed S

ervi

ceCe

ntre

- Des

ign

- Cot

ton

- Che

mic

al d

ye- V

eget

able

dye

Des

ign

Cent

re

Loca

lsh

eep

woo

l

Des

ign

Cent

reD

esig

nCe

ntre

Woo

l m

anuf

actu

rers

Gui

delin

es fo

rcu

tting

/ w

ashi

ng

Upg

rade

met

hods

Bree

dim

prov

emen

tAc

cess

tody

eing

tech

nolo

gy

Post

-wea

ving

trea

tmen

t

Ove

rgra

zing

prev

entio

n

Hus

band

ry a

ndpr

oduc

tivity

supp

ort

Dis

ease

Prev

entio

n an

dm

anag

emen

t

Inte

rnat

iona

l mar

ket


39

STRATEGIC OBJECTIVE 2 : ENABLE PRODUCTIVITY ENHANCEMENT OF SECTOR OPERATIONS THROUGH INCREASED COORDINATION AND APPROPRIATE SKILLS UPGRADING.

This strategic objective is focused on improving the sector’s capacity through upgrading skills demanded by the market and enhancing technology in sector operations. The fact that carpets are a traditional sector in Afghanistan means that skills need to be formalized and upgraded to ensure a proper and sustained human capital supply to the industry, but there is currently no cooperation between private sector stakeholders and educational institutions. Hence, there is no relevant training for the sector in any formal education.

Sound links need to be established between the private sector and education and training institutions to facilitate innovation and growth in the industry. Dialogue and coor-dination will be fostered through the engagement of edu-cational institutions in developing courses required by the sector. Further, international exchanges will be promoted to increase the pool of skilled labour with design expertise.

Operationally, this translates to several activities, includ-ing scholarships and exchange programmes for students and professors with foreign design institutes. Upgrading skills in the carpet value chain will also be fostered through the launch of a practical training initiative targeting car-pet exporters in order to increase their entrepreneurship and marketing skills as well as their financial knowledge. Building the capacity of carpet producers to adapt to buyer

requirements through the provision of computerized de-sign training is also an activity to be implemented. Another key measure will be the creation of a master weavers pro-gramme that will have the dual objective of transferring the expertise of skilled weavers to the younger generation while rewarding the skills of these experienced weavers by provid-ing additional income.

Traditional weaving methods can be maintained within the industry as a differentiating attribute among competitors. However, this does not impede the adoption of technology to scale up production and add value at higher stages of the value chain. In operational terms, technology enhance-ment will be achieved by promoting investment in the carpet industry. Tailored incentives will be created to encourage the Afghan diaspora to invest in the carpet sector.

Another key measure will be to improve access to fi-nance, which can enable capital accumulation and busi-ness expansion. A first step to achieve this operational objective will be to sensitize commercial banks on sector stakeholders’ financial needs, as well as encourage banks to develop financing products that are appropriate for the industry. Finally, activities aimed at strengthening collabo-ration among carpet producers will also be implemented under this strategic objective.


40



Inpu

tsPr

oduc

tion

Asse

mbl

yPr

oces

sing

Dis

trib

utio

nD

omes

tic m

arke

t

Cob

Rang

Woo

lSi

lk m

anuf

actu

rers

Impo

rts

of In

put

Paki

stan

(& Ir

an)

Woo

l man

ufac

ture

rs

Chem

ical

and

nat

ural

dye

man

ufac

ture

rs

Belg

ian

Woo

l

Paki

stan

iW

ool

Inpu

t tra

ders

Mac

hine

-mad

e

Prof

it-sh

arin

g

Profit-sharing

Han

d-m

ade

Mid

dlem

en:

Subc

ontr

acto

r/ c

arpe

t tra

der

Indu

stri

al P

ark

Conn

ecte

d to

Wea

ving

Hou

seho

lds

- Pro

fit-s

harin

g- D

irect

pur

chas

e- S

ubco

ntra

ctin

g th

roug

h

carp

et tr

ader

s

Cutte

rs

Repa

irmen

Des

igne

rs

Stre

tche

rs

Fini

sher

s

Was

hers

Proc

esso

rs

Reta

iler

Expo

rter

Larg

e tr

ader

s

Dom

estic

Mar

ket

- Cho

b Ra

ng c

ompr

ises

70%

of t

rade

d vo

lum

e b

y va

lue

- Afg

han

trad

ition

al c

arpe

ts

Reim

port

Cutte

rsTo

tal E

xpor

t USD

90.

2 m

illio

nTo

p Ex

port

Des

tinat

ions

(S

ourc

e Co

mtra

de P

akis

tan:

di

rect

dat

a, re

st m

irror

ed

data

)- P

akis

tan

USD

77.6

mill

ion

- USA

USD

4.9

mill

ion

- Ger

man

y US

D 92

6,00

0- C

anad

a US

D 68

6,00

0- T

urke

y US

D 53

4,00

0- F

ranc

e US

D 39

7,00

0

Repa

irmen

Des

igne

rs

Stre

tche

rs

Fini

sher

s

Was

hers

Proc

esso

rs

Paki

stan

iTr

ader

sPa

kist

anOt

her I

nter

natio

nal

Mar

kets

Dom

estic

Inpu

ts- D

esig

n- C

otto

n- C

hem

ical

dye

- Veg

etab

le d

ye

Loca

lsh

eep

woo

lW

ool

man

ufac

ture

rs

Com

pute

rized

desi

gn

Inte

rnat

iona

lex

chan

ge o

f ski

lls

Prac

tical

trai

ning

Initi

ativ

e

Know

ledg

e tr

ansf

er

Upg

rade

tech

nolo

gy

Inte

rnat

iona

l mar

ket


41

STRATEGIC OBJECTIVE 3 : IMPROVE REGULATORY AND INSTITUTIONAL SUPPORT FOR THE SECTOR.

This strategic objective aims to improve the socioeconomic conditions of the weaving community, mitigate child labour in the sector and provide crucial institutional support in the areas of quality management and land access, among other goals.

The weaving community – primarily comprised of wom-en – shoulders significant burdens. These include unhygien-ic working conditions, depressed wages with limited scope for negotiation, and a deeply entrenched culture of using child labour. The goal of the Strategy is to gradually counter child labour through an approach that incentivizes rather than punishes an already suffering weaving community. The approach is to bring weaving communities out of isolation and into weaving workshops / centres, where working condi-tions are healthier ( using good industry practices such as vertical versus horizontal looms ) and wages are fair ( daily wages rather than output-based ). The Strategy proposes a framework of existing carpet cooperatives or other forms of

associations where possible. These centres will have sup-porting infrastructure such as day care facilities for children while mothers are gainfully employed.

Certifications such as GoodWeave that have a pres-ence in the country can be a useful instrument to incentivize traders to employ decent practices in contracting weavers, through the promise of increased international access and recognition that comes with GoodWeave certification.

This strategic objective is also geared towards improv-ing the quality management infrastructure in the sector. This will be accomplished by developing / revising and deploying Afghan standards, strengthening the capacity of ANSA to cater to the needs of the sector, and developing an imports surveillance regime to ensure proper quality and grading of imported wool, among other activities. Finally, easing burdensome land regulations and streamlining property ownership and leasing will be a focus area addressed by the Strategy.


42



Cutte

rs

Reta

iler

Expo

rter

Repa

irmen

Des

igne

rs

Stre

tche

rs

Fini

sher

s

Was

hers

Cutte

rsTo

tal E

xpor

t USD

90.

2 m

illio

nTo

p Ex

port

Des

tinat

ions

(S

ourc

e Co

mtra

de P

akis

tan:

di

rect

dat

a, re

st m

irror

ed

data

)- P

akis

tan

USD

77.6

mill

ion

- USA

USD

4.9

mill

ion

- Ger

man

y US

D 92

6,00

0- C

anad

a US

D 68

6,00

0- T

urke

y US

D 53

4,00

0- F

ranc

e US

D 39

7,00

0

Repa

irmen

Des

igne

rs

Stre

tche

rs

Fini

sher

s

Was

hers

Cob

Rang

Woo

lSi

lk m

anuf

actu

rers

Impo

rts

of In

put

Inpu

t tra

ders

Proc

esso

rs

Proc

esso

rs

Larg

e tr

ader

s

Paki

stan

iTr

ader

s

Paki

stan

Reim

port

Othe

r Int

erna

tiona

lM

arke

ts

Inte

rnat

iona

l mar

ket

Mid

dlem

en:

Subc

ontr

acto

r/ c

arpe

t tra

der

Dom

estic

Inpu

t- D

esig

n- C

otto

n- C

hem

ical

dye

- Veg

etab

le d

ye

Wea

ving

Hou

seho

lds

- Pro

fit-s

harin

g- D

irect

pur

chas

e- S

ubco

ntra

ctin

g th

roug

h

carp

et tr

ader

s

Paki

stan

(& Ir

an)

Prof

it-sh

arin

g

Han

d-m

ade

Profit-sharing

Woo

l man

ufac

ture

rs

Chem

ical

and

nat

ural

dye

man

ufac

ture

rs

Belg

ian

Woo

l

Paki

stan

iW

ool

Loca

lsh

eep

woo

l

Wea

ving

cent

res

Day

car

efa

cilit

ies

for

child

ren

Carp

et s

tora

gefa

cilit

y

Woo

l m

anuf

actu

rers

Best

pra

ctic

es

Qua

lity

stan

dard

for

carp

ets

Pest

con

trol

Wag

e-ba

sed

labo

ur

Hea

lth a

nd w

elfa

reof

wea

vers

Stan

dard

spec

ifica

tion

for

impo

rted

woo

l

Non

-chi

ld la

bour

cert

ifica

te

Inpu

t fro

m e

xpor

tor

gani

zatio

n

Goo

dWea

velic

ense

Impr

ove

acce

ss to

fina

nce

Dom

estic

Mar

ket

- Cho

b Ra

ng c

ompr

ises

70%

of t

rade

d vo

lum

e b

y va

lue

- Afg

han

trad

ition

al c

arpe

ts

Inpu

tsPr

oduc

tion

Asse

mbl

yPr

oces

sing

Dis

trib

utio

nD

omes

tic m

arke

t


43

STRATEGIC OBJECTIVE 4 : STRENGTHEN MARKET LINKS AND ENTERPRISE ABILITIES TO FORGE / SUSTAIN BUYER RELATIONSHIPS THROUGH IN-MARKET SUPPORT, BRANDING AND STREAMLINING CUSTOMS PROCEDURES.

To improve the carpet sector’s capacity to position itself in the global market, it is of utmost importance to strengthen market links and enterprise abilities to forge and maintain commercial relationships. Several factors contribute to the limited links between Afghan carpet companies and interna-tional operators, including the lack of opportunities to con-nect with potential buyers and develop expertise to compete in regional and international markets. Therefore, improving in-market support for enterprises is a prerequisite for ex-panding export opportunities.

In operational terms, this objective will be reached by facilitating the participation of Afghan carpet exporters in in-ternational fairs and exhibitions, along with business-to-busi-ness meetings in key target markets such as the UAE, the United States and Germany. Financial and logistical support will be provided through a grant mechanism for selected Afghan companies to participate in key events. To maximize business opportunities, beneficiary companies will also re-ceive assistance in the form of coaching to understand the market, support visa applications and facilitate one-on-one meetings with buyers, among other things.

Another key component of this strategic objective will be enabling trade attachés in key markets to provide relevant in-market support. Through this activity, Afghan companies will have access to reliable and tailored market informa-tion and will receive support to identify and connect with international partners. To improve dissemination of market intelligence to Afghan carpet exporters, market profiles for target markets will be developed and disseminated through mechanisms such as newsletters. This measure will promote the understanding of, and compliance with, import laws and regulations among Afghan carpet exporters.

As Afghan carpets are frequently exported under the label of a foreign country, strengthening the brand of the Afghan carpet sector is also a priority. A key component will be to explore the feasibility of establishing geographical in-dications for Afghan carpets in order to offer better legal pro-tection to domestic production. A careful examination should be undertaken to determine which Afghan carpet types linked to specific geographical regions within the country have the highest probability of, and potential benefits from, being awarded such legal protection. Geographical indica-tions can help increase the quality and marketing of specific Afghan carpet styles, since they are also a tool for branding and market promotion. Case studies in the region, such as the geographical indication provided to Pochampally Ikat

( sarees ) in India, should be studied to take advantage from lessons learned in other carpet-producing nations. Under this operational objective, sector-specific catalogues show-casing the attributes of the Afghan carpet industry will also be developed and disseminated.

Finally, it will be vital to streamline export clearance for the carpet sector. In operational terms, this objective will be reached by identifying and addressing the most bur-densome Customs procedures and common non-tariff measures that currently hinder carpet exports. Enhancing communication and cooperation with Customs authorities in neighbouring countries such as Pakistan will also be ex-plored. It is essential to improve data collection on cross-border trade of carpets, as well as to prevent and counter illegal activities damaging to the industry, such as smug-gling of carpets.


44


Figure 24 : Future value chain – strategic objective 4In

puts

Prod

uctio

nAs

sem

bly

Proc

essi

ngD

istr

ibut

ion

Dom

estic

mar

ket

Cob

Rang

Woo

lSi

lk m

anuf

actu

rers

Impo

rts

of In

put

Paki

stan

(& Ir

an)

Woo

l man

ufac

ture

rs

Chem

ical

and

nat

ural

dye

man

ufac

ture

rs

Belg

ian

Woo

l

Paki

stan

iW

ool

Inpu

t tra

ders

Mac

hine

-mad

e

Prof

it-sh

arin

g

Profit-sharing

Han

d-m

ade

Mid

dlem

en:

Subc

ontr

acto

r/ c

arpe

t tra

der

Wea

ving

Hou

seho

lds

- Pro

fit-s

harin

g- D

irect

pur

chas

e- S

ubco

ntra

ctin

g th

roug

h

carp

et tr

ader

s

Cutte

rs

Repa

irmen

Des

igne

rs

Stre

tche

rs

Fini

sher

s

Was

hers

Proc

esso

rs

Reta

iler

Expo

rter

Larg

e tr

ader

s

Dom

estic

Mar

ket

- Cho

b Ra

ng c

ompr

ises

70%

of t

rade

d vo

lum

e b

y va

lue

- Afg

han

trad

ition

al c

arpe

ts

Reim

port

Cutte

rsTo

tal E

xpor

t USD

90.

2 m

illio

nTo

p Ex

port

Des

tinat

ions

(S

ourc

e Co

mtra

de P

akis

tan:

di

rect

dat

a, re

st m

irror

ed

data

)- P

akis

tan

USD

77.6

mill

ion

- USA

USD

4.9

mill

ion

- Ger

man

y US

D 92

6,00

0- C

anad

a US

D 68

6,00

0- T

urke

y US

D 53

4,00

0- F

ranc

e US

D 39

7,00

0

Repa

irmen

Des

igne

rs

Stre

tche

rs

Fini

sher

s

Was

hers

Proc

esso

rs

Paki

stan

iTr

ader

sPa

kist

anOt

her I

nter

natio

nal

Mar

kets

Dom

estic

Inpu

ts- D

esig

n- C

otto

n- C

hem

ical

dye

- Veg

etab

le d

ye

Loca

lsh

eep

woo

lW

ool

man

ufac

ture

rs

Part

icip

atio

n at

fairs

and

exhi

bitio

ns

Gra

nts

mec

hani

sm

Coac

hing

and

or

gani

zatio

nal

supp

ort

Sele

ct ty

pes

ofca

rpet

s fo

r exp

ort

Publ

icat

ion

of fe

esan

d fo

rmal

ities

Trad

e da

taex

chan

ge

Prin

t lite

ratu

re,

broc

hure

s,ca

talo

gues

Targ

et m

arke

tpr

ofile

Elec

tron

icsu

bmis

sion

of

docu

men

tsInte

rnat

iona

l mar

ket

In-m

arke

t sup

port

[ MOVING TO ACTION ]

45

MOVING TO ACTION

KEY REQUIREMENTS FOR EFFECTIVE IMPLEMENTATION

The development of the future value chain for the carpets sector is a five-year project defined through a consultative process between Afghan public and private sector stake-holders. Achieving the strategic objectives and realizing the future value chain depend heavily on the ability of sector stakeholders to start implementing and coordinating the activities defined in the Strategy’s PoA.

The Strategy in and of itself will not alone suffice to en-sure the sector’s sustainable development. Such develop-ment will require the coordination of various activities. While the execution of these activities will allow for the Strategy’s targets to be achieved, success will depend on the ability of stakeholders to plan and coordinate actions in a tactical manner. Apparently unrelated activities must be synchro-nized across the public sector, private sector, non-govern-mental organizations and local communities in order to create sustainable results.

To ensure the success of the Strategy, it is necessary to foster an adequate environment and create an appro-priate framework for implementation. The following section presents some of the key success conditions considered necessary for effectively implementation.

ESTABLISH AND OPERATIONALIZE A PUBLIC AND PRIVATE COORDINATING BODY AND EXECUTIVE SECRETARIAT

Carpets sector steering committee

A key success criterion for the Strategy is the ability to coor-dinate activities, monitor progress and mobilize resources for implementation. It is recommended that a steering com-mittee comprised of key public and private sector entities be formed or supported ( if such a committee already exists ). This will function as a platform with balanced representation of all major carpet stakeholders to share information openly.

It is proposed that the steering committee be responsible for the following tasks related to Strategy implementation :

� Coordinate and monitor the implementation of the Strategy by the Government, private sector, institutions or international organizations to ensure implementation is on track;

� Identify and recommend allocation of resources neces-sary for the implementation of the Strategy;

� Assess the effectiveness and the impact of the Strategy; � Ensure consistency with the Government’s existing

policies, plans and strategies, and align institutions’ and agencies’ internal plans and interventions with the Strategy PoA;

� Elaborate and recommend revisions and enhancements to the Strategy so that it continues to best respond to the needs and long-term interests of the national business and export community;

� Propose key policy changes to be undertaken, based on Strategy priorities, and promote these policy changes among national decision makers;

� Guide the sector secretariat for the monitoring, coordi-nation, resource mobilization, and policy advocacy and communication functions to enable effective implementa-tion of the Strategy;

� Provide the sector secretariat with the mandate and the necessary resources to fulfil its functions effectively.

Composition of the carpets sector steering committeeIt is recommended that the steering committee be com-prised of key entities involved in the sector, with special fo-cus on ensuring equitable involvement of both the public and the private sector.

Secretariat

A secretariat will assist the steering committee by acting as an operational body responsible for the daily coordination, monitoring and mobilization of resources for implementing the PoA. It is proposed that it takes on this role with tech-nical support from key ministries and technical agencies. The secretariat will be composed of one to two technical operators.

46


The core responsibilities of the sector secretariat should be to :

� Support functioning of the carpets sector steering com-mittee;

� Collect and manage data to monitor the progress and impact of Strategy implementation;

� Liaise with and coordinate development partners for Strategy implementation;

� Elaborate project proposals and build partnerships to mobilize resources to implement the Strategy;

� Follow up on policy advocacy recommendations from the steering committee;

� Ensure effective communication and networking for suc-cessful Strategy implementation.

Both the carpets sector steering committee and its secretar-iat will work hand-in-hand with existing entities established to streamline Government operations and enhance donor operations. These include the NES secretariat and others. It is possible that the secretariat is accommodated as part of an existing entity with an extended mandate and resources allocated to it


STRATEGIC PLAN OF ACTION

48


Stra

tegi

c ob

ject

ive

1 : P

rese

rve /

capt

ure

incr

ease

d va

lue

at th

e in

puts

and

pro

cess

ing

stag

es o

f the

val

ue c

hain

Oper

atio

nal O

bjec

tives

Activ

ities

Prio

rity

1=hi

gh2=

med

3=lo

w

Impl

emen

tatio

n pe

riod

Targ

et*

Lead

and

Sup

porti

ng

Impl

emen

ters

2017

2018

2019

2020

2021

2022

1.1.

Impr

ove

the

prov

isio

n of

goo

d qu

ality

inpu

ts in

th

e se

ctor

.

1.1.

1. C

arry

out

a p

ilot p

rogr

amm

e to

sup

port

shee

p br

eede

rs in

hus

band

ry a

nd

prod

uctiv

ity.

• Id

entif

y ke

y as

socia

tions

and

coo

pera

tives

to s

erve

as

nucle

i for

the

pilo

t pro

-gr

amm

e in

main

carp

et-pr

oduc

ing p

rovin

ces.

• Ev

aluate

the r

each

of sh

eep b

reede

rs an

d the

ir pa

st wo

rk in

the ca

rpet

value

chain

. Ev

aluate

the i

mpl

emen

tatio

n ca

pacit

y of s

electe

d as

socia

tions

and

crea

te a p

ro-

file f

or ea

ch o

rgan

izatio

n.•

Deve

lop

the

train

ing

cont

ent (

curri

culu

m ) a

nd te

achi

ng m

ateria

ls. P

rogr

amm

e wi

ll inc

lude

train

ings o

n di

fferen

t area

s to

supp

ort t

he ca

rpet

indus

try, s

uch

as :

–Br

eed

impr

ovem

ent

–Ov

ergr

azin

g pr

even

tion

( e.g

. im

porta

nce

of re

sting

pas

ture

s an

d ro

tatin

g liv

esto

ck )

–Go

od p

ractic

es in

hus

band

ry an

d pr

oduc

tivity

–Di

seas

e prev

entio

n an

d m

anag

emen

t –

Raise

awa

rene

ss to

enc

oura

ge th

e pr

oduc

tion

of w

hite

shee

p wo

ol th

roug

h tar

geted

out

reach

info

rmati

onal

sess

ions

–Im

prov

e qua

lity o

f woo

l pro

ducti

on.

–La

unch

the p

ilot p

rogr

amm

e.

2•

Pilo

t pro

gram

me

set u

p an

d op

era-

tiona

l in

five

majo

r carp

et-pr

oduc

ing

prov

ince

s, in

clud

ing

Kabu

l, Ja

wzjan

an

d He

rat•

At le

ast 5

–10

shee

p br

eede

rs’ or

gan-

izatio

ns id

entif

ied a

nd a

sses

sed

and

prof

iles c

reated

MAI

L, M

oCI

ANSA

, Min

istry

of E

nerg

y an

d W

ater,

Min

istry

of R

ural

Reha

-bi

litati

on a

nd D

evelo

pmen

t, In-

depe

nden

t Dire

ctor

ate o

f Loc

al Go

vern

ance

1.1.

2. Ex

plor

e alte

rnati

ve m

ethod

s to w

ool s

cour

ing th

at ca

n im

prov

e the

effic

iency

, co

st-eff

ectiv

enes

s an

d wa

ter re

cove

ry / re

-use

in th

e wo

ol s

cour

ing

proc

ess

( e.g

. dr

y woo

l sco

uring

).

• Co

nduc

t a fe

asib

ility

study

.•

Asse

ss th

e pos

sibilit

y of c

ollab

orati

ng w

ith re

gion

al an

d inte

rnati

onal

instit

ution

s.De

velo

p pi

lot i

nitiat

ives a

nd ap

ply p

ilot d

emon

strati

on tr

ials u

sing

new

wool

scou

r-ing

tech

nolo

gies

.

3•

Five p

ilot in

itiativ

es de

velop

ed an

d five

co

rresp

ondin

g pilo

t dem

onstr

ation

tri-

als ar

e ope

ratio

nal

Afgh

anis

tan

Rese

arch

and

Ev

alua

tion

Unit,

MoC

I

1.1.

3. To

overc

ome t

he la

ck of

orga

nizati

on an

d as

socia

tions

in th

e woo

l sec

tor a

nd

the l

ack o

f pre-

weav

ing fa

ciliti

es, e

stabl

ish sh

ared

servi

ce ce

ntres

that

prov

ide s

er-vic

es su

ch as

woo

l sco

uring

, spi

nning

and d

yeing

of ya

rn to

prod

ucer

s’ as

socia

tions

in

majo

r woo

l pro

ducti

on ar

eas.

The f

ollo

wing

will

appl

y to

oper

ation

s with

in th

e cen

tres :

• Co

nduc

t fea

sibili

ty stu

dies

to s

elect

land

on w

hich

to e

stabl

ish th

ese

cent

res,

cons

ider

ing ac

cess

to w

ater a

nd e

lectri

city i

n ad

ditio

n to

strat

egic

loca

tion

vis-

à-vis

the r

est o

f the

supp

ly ch

ain.

• Fa

cilit

ate a

cces

s of

dye

ing

tech

nolo

gy to

sm

all o

pera

tors

; and

dev

elop

dye

-in

g, c

olou

r and

sha

de m

atchi

ng fa

ciliti

es to

impr

ove

the

colo

ur a

nd q

ualit

y of

fin

al pr

oduc

ts.•

Poten

tially

, the

se sh

ared

servi

ce ce

ntres

coul

d als

o of

fer cu

t and

was

h fac

ilitie

s.Th

e cen

tres c

ould

also

pro

vide :

• Sh

owro

oms t

o en

able

weav

ers t

o se

ll th

eir p

rodu

cts•

Stor

age f

acili

ties f

or fi

nishe

d pr

oduc

ts an

d raw

mate

rials

–De

sign

cent

res.

2•

Esta

blis

h at

leas

t five

sha

red

ser-

vice c

entre

s in

key p

rovin

ces s

uch

as

Jawz

jan, K

undu

z, Fa

ryab

, Her

at, a

nd

Kand

ahar

MoC

I, M

inist

ry o

f Ene

rgy

and

Wate

r, M

AIL,

ACC

I, AC

EG a

nd

asso

ciatio

ns

* Targets are indicative only and will be the subject of further refinement at beginning of the Implementation Management stage

Sim

ilarly

, the

lead

and

sup

port

ing

impl

emen

ters

col

umn

rem

ains

indi

cativ

e as

the

impl

emen

tatio

n w

ill re

quire

col

lect

ive

effo

rts,

for w

hich

add

ition

al in

stitu

tions

may

be

adde

d.

[ STRATEGIC PLAN OF ACTION ]

49

Stra

tegi

c ob

ject

ive

1 : P

rese

rve /

capt

ure

incr

ease

d va

lue

at th

e in

puts

and

pro

cess

ing

stag

es o

f the

val

ue c

hain

Oper

atio

nal O

bjec

tives

Activ

ities

Prio

rity

1=hi

gh2=

med

3=lo

w

Impl

emen

tatio

n pe

riod

Targ

et*

Lead

and

Sup

porti

ng

Impl

emen

ters

2017

2018

2019

2020

2021

2022

1.2.

Impr

ove

sect

or a

bilit

y to

und

erta

ke p

ost-

wea

v-in

g pr

oces

ses

insi

de t

he

coun

try.

1.2.

1. U

nder

take a

n ind

epen

dent

stud

y to

iden

tify t

he m

ain g

aps a

nd fl

aws i

n m

an-

agem

ent o

f gov

ernm

ent in

dustr

ial pa

rks de

dicate

d to c

arpets

. Ass

ess l

evels

of se

rvice

su

ppor

t, tec

hnica

l cap

aciti

es an

d ac

tivity

impl

emen

tatio

n, am

ong

othe

rs.Ba

sed

on id

entif

ied m

ain g

aps a

nd c

onstr

aints,

dev

elop

and

impl

emen

t cor

recti

ve

polic

y mea

sures

( e.g

. esta

blish

ing po

wer g

ener

ators

) and

tailo

red ca

pacit

y-bu

ilding

wo

rksho

ps ( e

.g. o

n im

prov

ing bo

okke

eping

) to k

ey go

vern

men

t offic

ials,

acco

rding

ly.

1•

An in

depe

nden

t stu

dy is

pre

pare

d to

as

sess

indu

strial

park

s•

Mea

sures

and

polic

ies ar

e dev

elope

d an

d int

egrat

ed, a

ccor

ding

ly

MoC

I, M

inis

try O

f Fi

nanc

e ( M

oF ),

Afgh

anist

an In

depe

nd-

ent L

and

Auth

ority

( ARA

ZI ),

Af-

ghan

istan

Cha

mbe

r of In

dustr

ies

and

Mine

s,AC

EG / a

ssoc

iatio

ns1.

2.2.

Laun

ch a

mul

titier

pro

gram

me t

o sup

port

the u

pgrad

e of e

xistin

g an

d th

e de-

velo

pmen

t of n

ew cu

t and

was

h fac

ilitie

s.Inc

rease

acce

ss to

cut

and

wash

facil

ities

with

in th

e co

untry

( as s

tand-

alone

bus

i-ne

sses

) thr

ough

this

mul

titier

pro

gram

me,

which

will

nee

d to

invo

lve :

• As

sess

men

t of e

xistin

g fac

ilitie

s, in

term

s of fu

nctio

ning o

f ope

ration

s, as

well

as

a mark

et an

alysis

to ev

aluate

incr

easin

g th

eir o

perat

iona

l cap

acity

.•

Feas

ibili

ty stu

dy o

f bus

iness

opp

ortu

nities

for t

he e

stabl

ishm

ent o

f new

cut

and

wash

facil

ities i

n main

prod

uctio

n pro

vince

s, inc

luding

the d

evelo

pmen

t of a

busi-

ness

mod

el wh

ere a

wash

and c

ut co

mpa

ny is

linke

d to s

mall

prod

ucer

s and

offer

s se

rvice

s suc

h as

qua

lity c

ontro

l and

labe

lling

( gen

eral

/ cus

tom

ized )

.•

Deve

lopm

ent o

f spe

cific

finan

cial s

chem

es.

• Te

chno

logy

tran

sfer.

• Tra

ining

on op

eratin

g and

main

tainin

g the

mac

hines

by cr

eatin

g link

s with

tech

nical

and

voca

tiona

l edu

catio

n an

d tra

ining

( TVE

T ) in

stitu

tions

in th

e area

. –

Entre

pren

eursh

ip fu

ndam

ental

s, am

ong

othe

r asp

ects

inclu

ding

con

tract

ne-

gotia

tion

skill

s.

1•

At le

ast fo

ur cu

t and

was

h fac

ilities

are

deve

lope

d / up

grad

ed p

er ye

arM

oCI,

ANSA

, Nat

iona

l Env

i-ro

nmen

tal P

rote

ctio

n Ag

ency

( N

EPA )

, Min

istry

of E

nerg

y and

W

ater, M

inistr

y of R

ural

Reha

bili-

tatio

n an

d De

velo

pmen

t, AR

AZI,

ACCI

, ACE

G / as

socia

tions

1.2.

3. Fa

cilita

te bu

sines

s-to

-bus

iness

links

betw

een c

ut an

d fini

sh se

rvice

supp

liers

and

carp

et pr

oduc

ers t

hrou

gh :

• Th

e or

gani

zatio

n of

fairs

and

exh

ibiti

ons

to b

ring

toge

ther

sup

plier

s an

d in

ter-

ested

par

ties.

–Th

e de

velo

pmen

t of a

dire

ctory

of c

ut an

d fin

ish se

rvice

supp

liers

to b

e di

s-se

mina

ted to

carp

et pr

oduc

ers t

hrou

gh w

ebsit

es an

d br

ochu

res.

2•

Two f

airs p

er ye

ar or

ganiz

ed in

six k

ey

prov

ince

s, su

ch a

s Ka

bul,

Jawz

jan,

Ku

nduz

, Fary

ab an

d He

rat•

A dir

ector

y is d

evelo

ped a

nd di

ssem

i-na

ted. D

irecto

ry up

dated

annu

ally

MoC

I ACC

I, ACE

G / as

socia

tions

1.2.

4. D

evelo

p str

ict op

erati

ng an

d en

viron

men

tal g

uideli

nes f

or q

ualit

y cut

ting

and

wash

ing o

f carp

ets.

Diss

emin

ate to

ser

vice

supp

liers

and

car

pet p

rodu

cers

thro

ugh

work

shop

s, br

o-ch

ures

and

webs

ites.

Enco

urag

e de

velo

pmen

t of s

ettlin

g po

nds t

o se

para

te to

xins f

rom

the

water

befo

re it

is di

scha

rged

.

2•

Guid

elin

es fo

r qua

lity

cutti

ng a

nd

wash

ing o

f carp

ets d

evelo

ped

• Tw

o wo

rksho

ps co

nduc

ted p

er ye

ar

NEPA

, MAI

L, AC

EG

1.2.

5. C

ondu

ct te

chni

cal s

tudi

es o

n im

prov

ed m

ethod

s an

d in

puts

to b

e us

ed in

po

st-we

aving

pro

cess

es.

• Fa

cilita

te co

llabo

ratio

n be

twee

n na

tiona

l and

forei

gn re

searc

h ins

titut

ions

on

re-se

arch

of u

pgrad

ed m

ethod

s and

inpu

ts to

be u

sed

in cu

t and

was

h pr

oces

ses.

• Co

nduc

t tec

hnica

l stu

dies

on

impr

oved

meth

ods a

nd in

puts

to b

e us

ed in

pos

t-we

aving

pro

cess

es.

Diss

emina

te rec

omm

enda

tions

to ca

rpet

prod

ucer

s and

asso

ciatio

ns th

roug

h sh

ort

cour

ses.

2•

Four

tech

nical

studi

es co

nduc

ted•

Four

shor

t cou

rses d

elive

red to

carp

et pr

oduc

ers a

nd as

socia

tions

MoC

I

50


Stra

tegi

c ob

ject

ive

2 : E

nabl

e pr

oduc

tivity

enh

ance

men

t of s

ecto

r ope

ratio

ns th

roug

h in

crea

sed

coor

dina

tion

and

appr

opria

te s

kills

upg

radi

ngOp

erat

iona

l Obj

ectiv

esAc

tiviti

esPr

iorit

yIm

plem

enta

tion

perio

dTa

rget

Lead

and

Sup

porti

ng

Impl

emen

ters

1=hi

gh2=

med

3=lo

w

2017

2018

2019

2020

2021

2022

2.1.

Stre

ngth

en c

oop-

erat

ion

amon

g se

ctor

op

erat

ors.

2.1.

1. P

rom

ote

the

form

ation

of c

arpe

t pro

duce

rs’ a

ssoc

iatio

ns a

nd in

crea

se th

e m

embe

rship

of e

xistin

g as

socia

tions

• En

cour

age t

he fo

rmati

on o

f carp

et pr

oduc

ers’

asso

ciatio

ns th

roug

h th

e org

aniza

-tio

n of

aware

ness

-raisi

ng se

mina

rs an

d op

en-h

ouse

mee

tings

.•

Prom

ote,

thro

ugh

the

sam

e ch

anne

ls, th

e ex

pans

ion

of m

embe

rshi

p in

exis

t-ing

asso

ciatio

ns.

1•

Two s

emina

rs pe

r yea

r con

ducte

d in

four

main

pro

ducin

g are

as, s

uch

as

Jawz

jan, K

undu

z, Fa

ryab

and

Herat

MoC

I, M

AIL,

ACCI

, ACE

G /

asso

ciatio

ns

2.1.

2. Es

tablis

h a hi

gh-le

vel c

oord

inatio

n plat

form

amon

g sec

tor su

ppor

t insti

tution

s, inc

ludi

ng A

CEG

and

busin

ess a

ssoc

iatio

ns.

• Co

ordi

natio

n pl

atfor

m to

form

alize

per

iodi

c m

eetin

gs to

disc

uss

and

com

mun

i-ca

te on

new

pol

icies

and

any d

evelo

pmen

ts wh

ich h

ave a

n im

pact

on th

e sec

tor,

amon

g ot

her i

ssue

s.

1•

Coor

dina

tion

platf

orm

estab

lishe

d•

Quar

terly

mee

tings

are c

ondu

cted

MoC

I, M

AIL,

ACCI

, ACE

G / a

sso-

ciatio

ns, M

oF

2.1.

3. E

stabl

ish c

omm

unity

-bas

ed w

eavin

g co

oper

ative

s / w

eavin

g ce

ntre

s wh

ere

wom

en ca

n wor

k tog

ether

in a s

afe an

d con

duciv

e env

ironm

ent r

ather

than i

n iso

lation

.

• Ad

here

to b

est p

ractic

es an

d sa

fe eq

uipm

ent (

such

as ve

rtica

l loo

ms )

.•

Abilit

y to b

uy in

put s

uppl

ies at

who

lesale

costs

and t

hereb

y im

prov

e the

ir m

argins

.•

Wag

e-ba

sed

labou

r rath

er th

an p

er u

nit co

st.•

Estab

lish d

ay ca

re fac

ilities

in cl

ose p

roxim

ity to

com

mun

ity-b

ased

wor

king f

acili-

ties t

o pr

ovid

e a sa

fe en

viron

men

t to

care

for c

hildr

en w

hile w

omen

are w

orkin

g.Fe

male

-led c

oope

rative

s wou

ld be

Goo

dWea

ve lic

ense

es w

ith th

e add

ition

al be

nefit

of

acce

ss to

inter

natio

nal m

arkets

.

2•

A ce

ntre i

s esta

blish

ed in

each

of th

e fiv

e m

ain p

rodu

cing

prov

ince

s, in

-clu

ding

Kab

ul an

d He

rat

Min

istr

y of

Wom

en’s

Affa

irs,

Min

istr

y of

Lab

our,

Soci

al A

f-fa

irs, M

arty

rs a

nd D

isab

led

( MoL

SAM

D ), M

oCI, A

CCI, A

CEG

/ ass

ociat

ions

2.1.

4. C

reate

tailo

red

ince

ntive

s to

pro

mot

e di

aspo

ra p

artic

ipati

on in

the

carp

et ind

ustry

.Cr

eate

tailo

red in

cent

ives t

argeti

ng th

e di

aspo

ra to

dire

ct th

eir re

mitt

ance

s tow

ards

inves

tmen

ts in

the c

arpet

secto

r. Th

is m

easu

re to

be i

mpl

emen

ted in

harm

ony w

ith

othe

r inv

estm

ent p

rom

otio

n m

easu

res ta

rgeti

ng A

fgha

ns ab

road

. Inc

entiv

es ca

n po

-ten

tially

inclu

de th

e fol

lowi

ng su

gges

tions

:

• Ta

x reb

ates /

subs

idies

. Exp

lore a

nd as

sess

sim

ilar m

easu

res in

neigh

bour

ing co

un-

tries

, e.g

. Pak

istan

, and

their

appl

icabi

lity t

o th

e Afg

han

carp

et se

ctor.

–Di

aspo

ra b

onds

. Ide

ntify

and

eva

luate

exa

mpl

es, e

.g. I

ndia

or Is

rael.

Ass

ess

poten

tial a

pplic

abili

ty fo

r the

Afg

han

carp

et se

ctor.

3•

List o

f inc

entiv

es is

dev

elope

d an

d in

plac

eM

oCI,

Min

istry

of R

ural

Reh

a-bi

litati

on an

d De

velo

pmen

t, M

oF,

carp

ets as

socia

tions

2.2.

Est

ablis

h se

ctor

-spe

-ci

fic tr

aini

ng p

rogr

amm

es.

2.2.

1. S

et up

an in

stitu

tiona

l and

tech

nical

fram

ewor

k with

in th

e sec

tor c

oord

inatio

n pl

atfor

m fr

om ac

tivity

2.1

.2.,

such

as a

carp

et sk

ills c

ounc

il, to

be

resp

onsib

le fo

r pl

annin

g and

mon

itorin

g of in

dustr

y-rel

ated t

rainin

g and

skills

deve

lopm

ent. T

he ca

r-pe

t skil

ls co

uncil

to be

form

ed by

priva

te se

ctor r

epres

entat

ives,

relev

ant u

niver

sities

an

d TVE

Ts, a

s well

as m

inistr

ies in

relat

ed se

ctors

and t

he M

inistr

y of W

omen

’s Af

fairs.

Ident

ify a

priva

te se

ctor i

nter

locu

tor t

o be

resp

onsib

le fo

r com

mun

icatio

n wi

th ac

a-de

mia.

The

inter

locu

tor m

ust h

ave

influ

ence

and

supp

ort f

rom

oth

er p

rivate

secto

r sta

keho

lder

s.

1•

Carp

et sk

ills c

ounc

il es

tablis

hed

Min

istr

y of

Edu

catio

n ( M

oE ),

ACCI

, ACE

G, M

oCI


51

Stra

tegi

c ob

ject

ive

2 : E

nabl

e pr

oduc

tivity

enh

ance

men

t of s

ecto

r ope

ratio

ns th

roug

h in

crea

sed

coor

dina

tion

and

appr

opria

te s

kills

upg

radi

ngOp

erat

iona

l Obj

ectiv

esAc

tiviti

esPr

iorit

yIm

plem

enta

tion

perio

dTa

rget

Lead

and

Sup

porti

ng

Impl

emen

ters

1=hi

gh2=

med

3=lo

w

2017

2018

2019

2020

2021

2022

2.2.

Est

ablis

h se

ctor

-spe

-ci

fic tr

aini

ng p

rogr

amm

es.

2.2.

2. C

arpet

skill

s cou

ncil

to co

nduc

t a sk

ills g

ap st

udy o

n th

e sec

tor.

Cond

uct a

rapi

d ass

essm

ent o

f the s

ecto

r thr

ough

field

cons

ultati

ons w

ith pr

oduc

ers,

buye

rs, yo

ung

peop

le an

d tra

ining

insti

tutio

ns to

:

• Id

entif

y th

e sk

ills

dem

ande

d by

the

mar

ket i

n th

e di

ffere

nt s

tages

of t

he c

arpe

t va

lue c

hain.

• M

ap th

e exis

ting f

orm

al tra

ining

offer

, esp

ecial

ly in

traini

ng in

stitut

ions i

n the

north

as

well

as in

Her

at an

d Ka

bul.

Asse

ss th

e int

erest

of yo

ung

peop

le to

enga

ge in

the c

arpet

secto

r.

2•

Skills

gap s

tudy c

ondu

cted,

focu

sing

on th

e main

prod

ucing

area

s, inc

lud-

ing H

erat

and

Kabu

l

MoE

, ACC

I, AC

EG

2.2.

3. C

urric

ulum

dev

elopm

ent w

ith st

anda

rds a

nd ce

rtific

ation

sche

mes

adop

ted.

Base

d on t

he fin

dings

of th

e skil

ls ga

p stud

y, tra

ining

insti

tution

s will

be su

ppor

ted to

:

• De

velop

and i

mpr

ove c

urric

ula re

levan

t to th

e carp

et se

ctor i

n area

s suc

h as w

eav-

ing an

d ca

rpet

desig

n, in

cludi

ng co

mpu

terize

d de

sign

traini

ng.

• Int

egrat

e ent

repren

eursh

ip an

d int

rodu

ctory

busin

ess m

anag

emen

t mod

ules

.Al

ign

with

nati

onal

or in

terna

tiona

l stan

dard

s an

d ce

rtific

ation

sch

emes

to e

nsur

e rec

ognit

ion

of th

e qua

lifica

tions

and

mee

t mark

et req

uirem

ents.

2•

Curri

cula

deve

lope

dM

oE, A

CCI,

ACEG

, ANS

A

2.2.

4. R

oll o

ut m

arket-

relev

ant T

VET t

rainin

g pr

ogram

mes

.En

hanc

e and

roll

out t

echn

ical s

kills

traini

ng p

rogr

amm

es re

lated

to th

e carp

et se

c-to

r to

Afgh

an y

outh

, inc

ludi

ng s

choo

l dro

pout

s an

d re

turn

ees.

The

skill

are

as w

ill

be b

ased

on

the c

arpet

secto

r skil

ls ga

p as

sess

men

t and

the e

nhan

ced

curri

cula

in or

der t

o en

sure

align

men

t with

mar

ket r

equir

emen

ts. T

he tr

aining

pro

gram

mes

will

be

dep

loye

d th

roug

h :

• Ex

isting

loca

l trai

ning

instit

utio

ns en

gage

d in

carp

et se

ctor s

kills

deve

lopm

ent.

• Co

mpu

ter-b

ased

train

ing o

n ca

rpet

desig

n, en

trepr

eneu

rship

and

trade

.Sk

ills c

ompe

titio

ns an

d aw

ard m

echa

nism

s for

carp

et de

sign.

2•

Traini

ng pr

ogram

mes

focu

sed o

n the

ca

rpets

secto

r dev

elope

d an

d av

ail-

able

in fiv

e TVE

Ts

MoE

, ACC

I, AC

EG

2.2.

5. Pa

rtner

ship

s for

train

ing in

stitu

tions

. Esta

blish

arran

gem

ents

betw

een A

fgha

n tra

ining

insti

tutio

ns an

d reg

ional

/ int

erna

tiona

l trai

ning i

nstit

ution

s, pa

rticu

larly

with

co

untri

es w

ith e

xper

tise

in th

e ca

rpet

secto

r suc

h as

Indi

a, as

well

as in

terna

tiona

l co

mpa

nies p

rodu

cing n

eces

sary

techn

olog

y and

equip

men

t for

the c

arpet

secto

r to :

• Ex

chan

ge te

chnic

al kn

owled

ge o

n ca

rpet

desig

n an

d we

aving

• Co

nduc

t trai

ning

of tr

ainer

pro

gram

mes

to b

uild

instru

ctor c

apac

ity•

Acce

ss n

ew tr

aining

reso

urce

s•

Facil

itate

techn

olog

y and

equip

men

t tran

sfer.

3•

Two m

emor

andu

ms o

f und

erstan

ding

signe

d wi

th re

gion

al / i

nter

natio

nal

traini

ng in

stitu

tions

MoC

I, AC

CI, A

CEG

/ ass

ociat

ions

2.2.

6. A

ppren

tices

hip sc

hem

es in

carp

et de

sign

and

weav

ing. C

reate

a pro

gram

me

of m

aster

wea

vers

to tr

ansfe

r trad

ition

al sk

ills a

nd kn

owled

ge o

n ca

rpet

weav

ing.

Crea

te a s

hort-

term

paid

appr

entic

eship

pro

gram

me w

ith m

aster

craft

speo

ple t

o :

• De

liver

han

ds-o

n sk

ills t

rainin

g in

carp

et de

sign

and

weav

ing an

d en

sure

form

al kn

owled

ge tr

ansfe

r.Pr

ovid

e cer

tifica

tion

for t

he kn

owled

ge g

ained

.

3•

Mas

ter w

eave

rs pr

ogram

me c

reated

an

d ope

ration

al in

five T

VETs

scho

ols

/ ins

titut

ions

MoE

( TV

ET ),

MoL

SAM

D, A

CCI,

ACEG

/ as

socia

tions

52


Stra

tegi

c ob

ject

ive

2 : E

nabl

e pr

oduc

tivity

enh

ance

men

t of s

ecto

r ope

ratio

ns th

roug

h in

crea

sed

coor

dina

tion

and

appr

opria

te s

kills

upg

radi

ngOp

erat

iona

l Obj

ectiv

esAc

tiviti

esPr

iorit

yIm

plem

enta

tion

perio

dTa

rget

Lead

and

Sup

porti

ng

Impl

emen

ters

1=hi

gh2=

med

3=lo

w

2017

2018

2019

2020

2021

2022

2.2.

Est

ablis

h se

ctor

-spe

-ci

fic tr

aini

ng p

rogr

amm

es.

2.2.

7. S

ensit

ize yo

ung p

eopl

e on s

kills

deve

lopm

ent a

nd ec

onom

ic op

portu

nities

in

the c

arpets

secto

r, pa

rticu

larly

retur

nees

, thr

ough

:

• Ra

dio

show

s with

loca

l cha

mpi

ons i

n th

e sec

tor.

• Ex

hibiti

ons a

nd fa

irs to

pro

mot

e the

secto

r am

ong

youn

g pe

ople.

• So

cial m

edia

and

othe

r onl

ine p

latfo

rms w

ith h

igh

yout

h pr

esen

ce.

3•

Four

loca

l cha

mpi

ons i

dent

ified

and

recru

ited

for r

adio

show

s•

At le

ast s

ix ra

dio

show

seg

men

ts de

dica

ted to

loca

l cha

mpi

ons

• On

e exh

ibiti

on a

year

in at

least

four

un

ivers

ities

, inc

ludi

ng b

ut n

ot li

m-

ited

to K

abul

Min

istr

y of

Com

mun

icat

ions

an

d In

form

atio

n Te

chno

logy

, M

oCI,

carp

et as

socia

tions

2.3.

Fac

ilita

te te

chno

logy

up

grad

e th

roug

h en

ablin

g ac

cess

to

com

pute

rize

d de

sign

ing

2.3.

1. D

esig

n a p

ractic

al tra

ining

initi

ative

targ

eted

at im

prov

ing th

e des

ign

abili

ties

of A

fgha

n ca

rpet

firm

s. Th

e init

iative

will

aim

to u

pgrad

e sec

tor t

echn

olog

y thr

ough

th

e use

of c

ompu

terize

d de

sign.

• Ca

rpet

skill

s cou

ncil

to b

e res

pons

ible

for t

he tr

aining

initi

ative

.•

Orga

nize

train

ing

and

expl

orato

ry m

issio

ns to

neig

hbou

ring

coun

tries

, e.g

. the

Isl

amic

Repu

blic

of Ir

an a

nd In

dia,

to id

entif

y th

e be

st-su

ited

info

rmati

on te

ch-

nolo

gy a

nd s

oftw

are s

ervic

es fo

r com

puter

ized

desig

n to

be

prov

ided

to w

eav-

ing co

mpa

nies.

• De

velo

p a

curri

culu

m fo

r sho

rt co

urse

s on

the

use

of c

ompu

terize

d de

signs

for

carp

et pr

oduc

ers a

nd as

socia

tions

.•

Hire

desig

ners

on a

cont

ract b

asis

to d

evelo

p de

signs

for s

electe

d m

arkets

.

2•

Prac

tical

traini

ng in

itiati

ve la

unch

ed

and

oper

ation

al, in

cludi

ng :

• Tw

o tra

inin

g an

d ex

plor

atory

mis-

sions

org

anize

d pe

r yea

r•

Two

shor

t cou

rses o

n co

mpu

terize

d de

sign

per y

ear

MoE

, Min

istry

of H

ighe

r Edu

-ca

tion,

MoC

I ( A

CEG

), Ka

bul

Unive

rsity

2.3.

2. A

s par

t of t

he tr

aining

initi

ative

on c

arpet

desig

n, st

rengt

hen l

inkag

es w

ith in

-ter

natio

nal f

oreig

n de

sign

instit

utes

thro

ugh :

• De

velo

ping

an

exch

ange

pro

gram

me

betw

een

Afgh

an s

tude

nts

and

stude

nts

of

forei

gn d

esig

n ins

titut

es, e

.g. I

ndia.

• De

velo

ping

and

rolli

ng o

ut a

sche

me t

o aw

ard sc

holar

ship

s to

traine

es.

• De

velo

ping

an ex

chan

ge p

rogr

amm

e for

pro

fesso

rs of

forei

gn d

esig

n ins

titut

ions

to

teac

h at

Afgh

an in

stitu

tions

• Pr

ovid

ing d

esig

n so

ftware

and

spec

ialize

d de

sign

plot

ter ( p

rinter

) to

carp

et pr

o-du

cers

( 50 )

2•

At le

ast t

wo m

emor

andu

ms

of u

n-de

rstan

ding

sign

ed w

ith fo

reign

de-

sign i

nstitu

tions

to im

plem

ent a

n ex-

chan

ge p

rogr

amm

e•

One

sche

me

to a

ward

sch

olar

ship

s de

velo

ped

• At

leas

t two

mem

oran

dum

s of

un-

derst

andi

ng si

gned

with

forei

gn d

e-sig

n in

stitu

tions

on

exch

ange

pro

-gr

amm

es fo

r pro

fesso

rs

MoE

, Min

istry

of H

ighe

r Edu

-ca

tion,

MoC

I ( A

CEG

), Ka

bul

Unive

rsity

2.3.

3. O

rgan

ize a

com

petit

ive b

iddi

ng p

roce

ss to

facil

itate

and

diss

emina

te ac

cess

to

com

puter

ized d

esig

n for

carp

et pr

oduc

ers a

nd as

socia

tions

. Des

ign a

mec

hanis

m

( e.g

. par

tial g

rants )

to fa

cilita

te ac

cess

at m

inim

um co

st.

2•

Softw

are de

velop

ed an

d acc

esse

d by

50 s

mall

and

med

ium

-size

d en

ter-

prise

s ( SM

Es ) /

carp

et as

socia

tions

MoE

, Min

istry

of H

ighe

r Edu

-ca

tion,

MoC

I ( A

CEG

), Ka

bul

Unive

rsity

2.4.

Enh

ance

ent

repr

e-ne

urs’

ski

lls.

2.4.

1. In

crea

se c

arpe

t exp

orter

s’ en

trepr

eneu

rship

skill

s. Co

nduc

t sho

rt co

urse

s to

train

carp

et ex

porte

rs in

busin

ess a

nd ex

port

man

agem

ent,

spec

ifica

lly :

• Un

derst

andi

ng b

usine

ss in

Afg

hanis

tan : l

icenc

es, t

ax re

gim

es.

• Un

derst

andi

ng ex

porti

ng : e

xpor

t pro

cedu

res an

d do

cum

entat

ion,

Inco

term

s. –

Nego

tiatio

n sk

ills :

pric

ing, n

egot

iating

and

proc

uring

ord

ers.

2•

Thre

e sh

ort c

ours

es a

re ro

lled

out,

targe

ting

20 to

30

carp

et ex

porte

rs

annu

ally

MoC

I, AC

CI

2.4.

2. D

evelo

p ca

rpet

expo

rters’

bran

ding

and

mark

eting

skill

s. Co

nduc

t bas

ic an

d ad

vanc

ed tr

aining

cour

ses o

n :

• Br

andi

ng, m

arke

ting

sales

and

clie

nts

relat

ions

hips

: cre

ating

and

dev

elopi

ng a

br

and,

reac

hing

out

to p

oten

tial b

uyer

s, pr

esen

ting

the

carp

et po

rtfol

io th

roug

h up

-to-d

ate m

arketi

ng p

ractic

es.

2•

Two

shor

t cou

rses

are

rolle

d ou

t, ta

rget

ing

20 to

30

carp

et e

xpor

t-er

s ann

ually

MoC

I, AC

CI


53

Stra

tegi

c ob

ject

ive

3 : Im

prov

e th

e re

gula

tory

and

inst

itutio

nal s

uppo

rt fo

r the

sec

tor

Oper

atio

nal O

bjec

tives

Activ

ities

Prio

rity

Impl

emen

tatio

n pe

riod

Targ

etLe

ad a

nd S

uppo

rting

Im

plem

ente

rs1=

high

2=m

ed3=

low

2017

2018

2019

2020

2021

2022

3.1.

Pro

gres

sive

ly im

prov

e w

ork-

ing

cond

ition

s in

the

sect

or.

3.1.

1. La

unch

an ad

voca

cy c

ampa

ign

to e

ncou

rage

trade

rs to

pro

gres

-siv

ely o

ffer w

ages

rath

er th

an p

er-un

it pa

ymen

t. Inc

entiv

ize th

is th

roug

h th

e opt

ion of

beco

ming

a Go

odW

eave

licen

see,

which

facil

itates

acce

ss

to in

terna

tiona

l mark

ets.

3•

One a

nnua

l cam

paig

n is r

olled

out

MoC

I, M

oLSA

MD,

ACE

G

3.1.

2. C

ondu

ct tw

o ro

und

tables

annu

ally,

targe

ting

30 p

rodu

cers

and

10 tr

ader

s.2

• Tw

o ro

und

table

s co

nduc

ted

an-

nuall

y, tar

getin

g 30

pro

duce

rs an

d 10

trad

ers

MoC

I, M

oLSA

MD,

ACE

G

3.1.

3. D

evelo

p a

posit

ion

pape

r aim

ed a

t lob

byin

g th

e Go

vern

men

t to

intro

duce

and

enf

orce

labo

ur re

gulat

ions

spe

cifica

lly ta

rgeti

ng c

arpe

t we

aving

.

3•

Posit

ion p

aper

dev

elope

d an

d di

s-se

mina

ted th

roug

h a s

emina

rM

oLSA

MD,

ANS

A, M

oCI, A

CCI,

ACEG

/ as

socia

tions

3.1.

4. To

impr

ove

the

healt

h co

nditi

ons

of a

rtisa

ns, c

reate

a s

chem

e to

add

ress

the

welfa

re re

quire

men

ts of

wea

vers

with

resp

ect t

o he

alth

and

insur

ance

.

2•

Sche

me i

s crea

ted an

d ope

ration

alM

inis

try

of P

ublic

Hea

lth,

MoL

SAM

D, M

oCI,

ACEG

/

asso

ciatio

ns3.

2. G

radu

ally

red

uce

the

pres

-en

ce o

f chi

ld la

bour

in th

e se

ctor

.3.

2.1.

Exten

d the

reac

h of n

on-c

hild l

abou

r cer

tifica

tions

such

as G

ood-

Wea

ve at

the n

ation

al lev

el.Su

ppor

t and

facil

itate

the

exten

sion

of n

on-c

hild

labo

ur c

ertif

icatio

ns

for c

arpe

t pro

duct

ion

in th

e co

untry

thro

ugh

natio

nal a

ware

ness

-rais-

ing ca

mpa

igns

.

2•

An an

nual

natio

nal a

waren

ess-

rais-

ing ca

mpa

ign

is ro

lled

out

MoC

I, M

oLSA

MD,

ANS

A, M

inis-

try o

f Pub

lic H

ealth

, ACC

I, AC

EG

3.2.

2. C

reate

incen

tives

such

as gr

ant s

uppo

rt to

facil

itate

the p

artic

ipa-

tion

of c

ertif

ied ‘n

o-ch

ild-la

bour

’ carp

et ex

porte

rs in

inter

natio

nal f

airs

and

exhib

ition

s.

2•

List o

f ince

ntive

s is d

evelo

ped a

nd

oper

ation

alM

oLSA

MD,

MoC

I, AC

CI, A

CEG

/ ass

ociat

ions

3.2.

3. C

ondu

ct co

mm

unity

-bas

ed aw

arene

ss-ra

ising

and e

duca

tion w

ork-

shop

s aim

ed a

t cha

lleng

ing

the

norm

of c

hild

labo

ur a

nd a

ssoc

iated

pr

actic

es in

the s

ecto

r.

3•

Two

works

hops

per

yea

r are

con

-du

cted

in fi

ve m

ajor

pro

duct

ion

prov

inces

MoE

, MoL

SAM

D, A

CEG

/ ass

o-cia

tions

, MoC

I

54


Stra

tegi

c ob

ject

ive

3 : Im

prov

e th

e re

gula

tory

and

inst

itutio

nal s

uppo

rt fo

r the

sec

tor

Oper

atio

nal O

bjec

tives

Activ

ities

Prio

rity

Impl

emen

tatio

n pe

riod

Targ

etLe

ad a

nd S

uppo

rting

Im

plem

ente

rs1=

high

2=m

ed3=

low

2017

2018

2019

2020

2021

2022

3.3.

Impr

ove

qual

ity m

anag

emen

t at

the

inst

itutio

nal a

nd e

nter

pris

e le

vels

.

3.3.

1. C

onsid

er th

e de

velo

pmen

t of a

nati

onal

prod

uct c

ertif

icati

on

sche

me (

volu

ntary

) for

carp

ets b

ased

on

estab

lishe

d sta

ndard

s.

• Se

t up

an in

stitu

tiona

l and

tech

nica

l fra

mew

ork

with

in th

e se

ctor

co

ordi

natio

n pl

atfor

m fr

om a

ctivit

y 2.

1.2.

, suc

h as

a c

omm

ittee

on

quali

ty sta

ndard

s fo

r car

pets,

form

ed b

y pu

blic

and

priva

te s

ecto

r sta

keho

lder

s.•

Revis

e th

e qu

ality

stand

ards a

nd c

ertif

icatio

n sc

hem

e de

velo

ped

by

ACEG

.•

Revie

w th

e na

tiona

l stan

dard

s alr

eady

ado

pted

by

ANSA

app

licab

le to

the c

arpet

secto

r.•

Unde

r the

lead

ersh

ip of

ANS

A an

d in c

oope

ration

with

carp

et pr

oduc

-er

s’ an

d ex

porte

rs’ a

ssoc

iatio

ns a

nd o

ther

key

stake

hold

ers,

asse

ss

wheth

er ad

dition

al sta

ndard

s are

need

ed. P

oten

tial fo

cus c

ould

be on

: –

Quali

ty of

inpu

ts –

Quali

ty req

uirem

ents

for t

hrea

ds –

Proc

ess-

orien

ted s

tanda

rds

for w

eavin

g, w

ashi

ng a

nd /

or c

ut-

ting

carp

ets.

If suc

h stan

dard

s are

requir

ed, r

eque

st AN

SA to

inclu

de th

em in

the a

n-nu

al wo

rkplan

.

• AN

SA to

dev

elop

any

miss

ing

stan

dard

s th

roug

h th

e Te

chni

cal

Com

mitt

ee, i

nclu

ding

all

relev

ant p

ublic

and

priv

ate s

takeh

olde

rs,

with

carp

et as

socia

tions

as a

mem

ber.

• Di

ssem

inate

the e

stabl

ished

certi

ficati

on sc

hem

e thr

ough

: –

Deve

lopm

ent a

nd d

issem

inati

on o

f a g

uide

on

Afgh

an n

ation

al sta

ndard

s for

the p

rodu

ction

of c

arpets

. –

An aw

arene

ss-ra

ising

cam

paig

n, in

volvi

ng w

orks

hops

for p

rodu

c-er

s’ as

socia

tions

and

exp

orter

s, pa

rticu

larly

in m

ajor p

rodu

ction

co

mm

uniti

es an

d we

aving

cent

res.

• Ide

ntify

key p

ublic

and

priva

te se

ctor i

nstit

utio

ns w

hich

are th

e mos

t su

itabl

e to s

uppo

rt th

ese w

orks

hops

, con

sider

ing th

eir in

fluen

ce an

d rea

ch in

main

pro

ducin

g reg

ions

.•

Cond

uct w

orks

hops

for t

rader

s as w

ell, s

o the

y effe

ctive

ly dis

sem

inate

this

infor

mati

on to

pro

duce

rs th

ey w

ork w

ith.

1•

Natio

nal

prod

uct

cert

ifica

-tio

n sc

hem

e is

dev

elop

ed a

nd

oper

ation

al•

A gu

ide

is cr

eate

d an

d di

ssem

i-na

ted

thro

ugh

news

lette

rs a

nd

webs

ites

• A

com

preh

ensi

ve c

ampa

ign

is ro

lled

out,

incl

udin

g tw

o wo

rk-

shop

s pe

r yea

r con

duct

ed in

at

least

five m

ain pr

oduc

ing pr

ovinc

es

ANSA

, MoC

I, MAI

L, AC

CI, A

CEG

/ ass

ociat

ions

, NEP

A

3.3.

2. S

treng

then

the

capa

city o

f ANS

A to

eva

luate

and

certi

fy co

mpl

i-an

ce w

ith ca

rpet

stand

ards.

• As

certa

in th

e co

mpe

tenc

ies a

t ANS

A to

eva

luate

com

plian

ce w

ith

carp

et sta

ndard

s.De

velo

p an

d im

plem

ent c

apac

ity-b

uildi

ng p

rogr

amm

es to

brid

ge te

ch-

nical

capa

city g

aps.

1•

Tech

nical

asse

ssm

ent is

carri

ed ou

t an

d re

com

men

datio

ns a

re p

ut in

pl

ace a

ccor

ding

ly

ANSA

, MoC

I, MAI

L, AC

CI, A

CEG

/ ass

ociat

ions

, NEP

A

3.3.

3 Su

ppor

t pes

t con

trol i

n ca

rpet

storag

e fac

ilitie

s :

• De

velo

p an

d im

plem

ent a

n int

egrat

ed p

est m

anag

emen

t pro

gram

me

for c

arpet

storag

e fac

ilitie

s to

prev

ent a

nd m

anag

e pes

t inf

estat

ions

.Ide

ntify

and

train

respo

nsib

le sta

ff on

the

impl

emen

tatio

n of

integ

rated

pe

st m

anag

emen

t for

car

pet s

tora

ge fa

ciliti

es. R

eleva

nt st

aff m

embe

rs

to b

e trai

ned

in co

njun

ction

with

ACE

G an

d as

socia

tions

.

2•

Integ

rated

pest

man

agem

ent is

de-

velo

ped

and

oper

ation

al•

At le

ast 5

0 re

spon

sible

staf

f are

tra

ined

on

inte

grat

ed p

est m

an-

agem

ent f

or c

arpe

t sto

rage

facil

i-tie

s thr

ough

shor

t cou

rses

Min

istr

y of

Pub

lic H

ealth

, AN

SA, M

oCI, M

AIL,

ACCI

, ACE

G / a

ssoc

iatio

ns, N

EPA


55

Stra

tegi

c ob

ject

ive

3 : Im

prov

e th

e re

gula

tory

and

inst

itutio

nal s

uppo

rt fo

r the

sec

tor

Oper

atio

nal O

bjec

tives

Activ

ities

Prio

rity

Impl

emen

tatio

n pe

riod

Targ

etLe

ad a

nd S

uppo

rting

Im

plem

ente

rs1=

high

2=m

ed3=

low

2017

2018

2019

2020

2021

2022

3.3.

Impr

ove

qual

ity m

anag

emen

t at

the

inst

itutio

nal a

nd e

nter

pris

e le

vels

.

3.3.

4. D

evelo

p Afg

han t

echn

ical r

egula

tions

for i

mpo

rted w

ool to

ensu

re pr

oper

grad

ing o

r qua

lity a

ssur

ance

.

• De

velo

p Af

ghan

spec

ifica

tions

for w

ool i

mpo

rts.

• Es

tablis

h an

impo

rt ins

pecti

on re

gim

e. As

sess

the t

echn

ical c

apac

i-tie

s and

equip

men

t nee

ded

to co

nduc

t ins

pecti

ons,

verif

icatio

ns.

3•

Afgh

an te

chni

cal r

egul

ation

s ar

e cr

eate

d an

d en

forc

ed th

roug

h an

im

port

inspe

ction

regi

me

ANSA

, MoC

I, M

inistr

y of P

ublic

He

alth,

MAI

L, A

CCI,

ACEG

/ as

-so

ciatio

ns, N

EPA

3.4.

Fac

ilita

te im

prov

ed a

cces

s to

land

.3.

4.1.

Fac

ilitat

e inc

rease

d ac

cess

to g

over

nmen

t lan

d wi

th se

cure

titles

as

an in

terim

step

until

the on

going

proc

ess o

f doc

umen

ting p

rivate

land

tit

les is

fina

lized

. Thi

s will

invo

lve c

lear a

nd tr

ansp

arent

pro

cess

es fo

r pu

rcha

sing

and

leasin

g lan

d.

• De

velo

p an

inve

ntor

y of a

vaila

ble

land

for p

oten

tial n

ation

al an

d fo

r-eig

n inv

esto

rs ( e

.g. d

iaspo

ra ) i

n the

secto

r, tak

ing in

to ac

coun

t main

ca

rpet

prod

uctio

n are

as, b

asic

infra

struc

ture

ava

ilabl

e ( w

ater,

elec-

tricit

y ) an

d tran

spor

t rou

tes. D

evelo

p a co

mpr

ehen

sive c

orres

pond

ing

repor

t for

each

iden

tified

avail

able

land

area.

• Di

ssem

inate

the lis

t thro

ugh w

orks

hops

and o

ther d

issem

inatio

n cha

n-ne

ls, su

ch as

pos

ters a

nd n

ewsle

tters,

at th

e na

tiona

l and

pro

vincia

l lev

els. T

arget

audi

ence

sho

uld

be A

CEG,

ass

ociat

ions

and

pro

duc-

ers,

and

dias

pora

asso

ciatio

ns. P

rovid

e as

sistan

ce fo

r lan

d reg

istra-

tion

as re

quire

d.

2•

An

inve

ntor

y of

av

aila

ble

Gove

rnm

ent l

and

in a

t lea

st fiv

e pr

ovinc

es is

crea

ted•

At le

ast 1

5–20

repo

rts a

re d

evel-

oped

and

diss

emina

ted

ARAZ

I, M

oCI

3,4,

2. La

unch

a ca

mpa

ign

to p

rom

ote l

and

regist

ratio

n.

• De

velop

infor

mati

onal

mate

rial th

roug

h diffe

rent c

omm

unica

tion c

han-

nels,

inclu

ding

new

slette

rs an

d we

bsite

s of A

CEG

and

asso

ciatio

ns,

to c

omm

unica

te ad

mini

strati

ve p

roce

dures

for l

and

regist

ratio

n an

d ac

quisi

tion.

Con

duct

traini

ng se

ssio

ns fo

r carp

et co

mpa

nies o

n pr

o-ce

dures

for l

and

acqu

isitio

n an

d ad

mini

strati

on, c

urren

t lan

d ref

orm

ini

tiativ

es, d

isput

e sett

lemen

t mec

hanis

ms a

nd th

eir la

nd ri

ghts.

2•

A na

tiona

l cam

paig

n is

deve

lope

d an

d ro

lled

out a

nnua

lly

ARAZ

I, M

oCI

3.5.

Impr

ove

the

prov

isio

n of

fi-

nanc

e in

the

sect

or.

3.5.

1. In

crea

se a

ware

ness

of c

omm

ercia

l ban

ks a

bout

the

carp

et se

c-to

r’s fi

nanc

ial se

rvice

nee

ds.

• Th

roug

h bila

teral

mee

tings

and w

orks

hops

, cap

acita

te lea

ders

of AC

EG

and a

ssoc

iation

s to p

eriod

ically

com

mun

icate

with

indu

strial

lend

ers

to lo

bby f

or fi

nanc

ial su

ppor

t for

the c

arpet

secto

r.

2•

Two

work

shop

s tar

getin

g le

ader

s of

ACE

G an

d ass

ociat

ions p

er ye

arDa

Afg

hani

stan

Ban

k, A

fgha

n-ist

an B

anks

Ass

ocia

tion,

MoF

, M

oCI,

Afgh

anis

tan

Cham

ber

of In

dustr

ies

and

Min

es, A

CCI,

ACEG

/ as

socia

tions

3.5.

2. A

ssist

bank

s in a

sses

sing b

usine

ss pr

opos

als fr

om ca

rpet

com

pa-

nies t

hrou

gh ta

ilored

wor

king

sess

ions

out

lining

secto

r fina

ncial

need

s. Ex

plor

e ava

ilabl

e cred

it sc

hem

es in

neig

hbou

ring

coun

tries

such

as In

-di

a ( i.e

. con

cess

ional

credi

t for h

andl

oom

s ) an

d ass

ess a

pplic

abilit

y for

th

e Afg

han

carp

et se

ctor.

Desig

n an

d de

velo

p ap

prop

riate

finan

cing

mec

hani

sms (

inclu

ding

Is-

lamic

finan

cing p

rodu

cts an

d par

ticul

ar em

phas

is on

wom

en’s

acce

ss ).

2•

Two w

orkin

g ses

sions

are h

eld be

-tw

een

sect

or a

ssoc

iatio

n le

ader

s an

d ba

nks r

epres

entat

ives

Da A

fgha

nist

an B

ank,

Af-

ghan

ista

n Ba

nks

Asso

ciat

ion,

M

oF, M

oCI,

ACCI

, Afg

hani

stan

Wom

en C

ham

ber o

f Com

mer

ce

and I

ndus

try, A

CEG

/ ass

ociat

ions

56


Stra

tegi

c ob

ject

ive

4 : S

treng

then

mar

ket l

inka

ges

and

ente

rpris

e ca

pabi

litie

s to

forg

e / s

usta

in b

uyer

rela

tions

hips

thro

ugh

in-m

arke

t sup

port,

bra

ndin

g an

d st

ream

linin

g of

cus

tom

s pr

oced

ures

Oper

atio

nal O

bjec

tives

Activ

ities

Prio

rity

Impl

emen

tatio

n pe

riod

Targ

etLe

ad a

nd S

uppo

rting

Im

plem

ente

rs1=

high

2=m

ed3=

low

2017

2018

2019

2020

2021

2022

4.1.

Enh

ance

in-m

arke

t sup

-po

rt fo

r car

pet e

xpor

ters

.4.

1.1.

Fac

ilitat

e par

ticip

ation

of c

arpet

expo

rters

in int

erna

tiona

l fair

s and

exhib

ition

s, in

com

bina

tion

with

bus

iness

-to-b

usine

ss m

eetin

gs in

key t

arget

mark

ets.

• De

velo

p a g

rants

mec

hanis

m th

roug

h wh

ich fi

rms c

an ap

ply f

or m

oneta

ry an

d lo

gis-

tical

supp

ort t

o th

e ev

ents

( exa

mpl

es in

clud

e th

e Int

erna

tiona

l Car

pet E

xhib

ition

in

Xinin

g an

d DO

MOT

EX ).

• Pr

ovid

e coa

ching

and

orga

nizati

onal

supp

ort f

or :

–Pr

e-ev

ent c

apac

ity-b

uildi

ng w

orks

hops

on m

arket

intell

igen

ce, In

coter

ms,

nego

tia-

tion

skill

s, ho

w to

mee

t and

follo

w up

with

forei

gn b

uyer

s, am

ong

othe

rs. –

Visa

appl

icatio

ns w

here

nece

ssary

. –

One-

on-o

ne m

eetin

gs w

ith b

uyer

s. –

Deve

lopi

ng m

arketi

ng co

llater

al.

1•

Four

car

pet e

nter

prise

s ar

e su

p-po

rted

to p

artic

ipate

in tr

ade

fairs,

pe

r yea

r

MoC

IM

inis

try o

f For

eign

Affa

irs,

ACCI

,AC

EG /

asso

ciatio

ns

4.1.

2. C

apac

itate

trade

atta

chés

in ke

y int

erna

tiona

l mar

kets

to e

nabl

e th

em to

pro

vide

relev

ant i

n-m

arket

supp

ort.

• At

taché

s to

prov

ide b

usine

ss su

ppor

t ser

vices

to in

teres

ted ca

rpet

expo

rters,

such

as :

–Cr

eatio

n of a

list o

f the

host

coun

try’s

impo

rt reg

ulati

ons a

nd re

strict

ions

, and

a lis

t of

pot

entia

l im

porte

rs / d

istrib

utor

s. –

Prep

are gu

idan

ce on

prici

ng of

carp

ets to

ensu

re co

mpe

titive

ness

in ta

rget

mark

ets

while

max

imizi

ng p

rofit

s.•

Cont

act d

etails

of k

ey b

uyer

s in

the t

arget

mark

et.

1•

At l

east

15

trade

atta

chés

are

tra

ined i

n key

inter

natio

nal m

arkets

, inc

ludi

ng P

akist

an, I

ndia,

UAE

and

the U

nited

Stat

es

MoC

IM

inis

try o

f For

eign

Affa

irs,

ACCI

,AC

EG /

asso

ciatio

ns

4.1.

3. C

ultiva

te int

erm

ediar

ies –

profe

ssion

al co

nsult

ants

– wh

o can

help

com

panie

s ove

r-co

me t

echn

olog

y and

lang

uage

barr

iers,

and

forg

e rela

tions

hips w

ith b

uyer

s.

• Cr

eate

a sho

rt co

urse

tailo

red fo

r the

Afg

han c

ontex

t on m

arketi

ng, s

ales a

nd cl

ient r

e-lat

ions

hips,

inclu

ding

curri

culu

m an

d tra

ining

mate

rials.

• De

liver

shor

t cou

rse to

staff

of co

nsult

ing co

mpa

nies a

nd in

depe

nden

t con

sulta

nts ( e

.g.

on b

usine

ss ad

visor

y ser

vices

) in

Afgh

anist

an.

2•

Two

shor

t cou

rses

are

con

duct

ed

per y

ear

MoC

I,

ACC

I,

ACEG

/

asso

ciatio

ns

4.1.

4. T

hrou

gh a

feas

ibili

ty stu

dy, e

valu

ate th

e po

ssib

ility

of e

stabl

ishin

g wa

reho

uses

an

d sh

owro

oms

in ke

y ex

port

mar

kets

as P

PP. L

aunc

h a

pilo

t in

a ke

y m

arke

t and

ex-

pand

it, a

s req

uired

2•

Feas

ibili

ty s

tudy

and

pilo

t de

velo

ped

MoC

I, AC

CI, G

uild

/ Ass

ocia-

tions

, MCI

T, co

mm

ercial

bank

s

4.1.

5.De

velo

p a p

ilot i

nitiat

ive o

n e-

com

merc

e for

the c

arpet

secto

r.

• Ex

plore

e-co

mm

erce p

otenti

al for

carp

ets th

roug

h a se

ctor s

tudy,

analy

sing e

-com

merc

e rea

dines

s, m

arkets

and a

vaila

ble o

nline

mark

et too

ls, pa

ymen

t pro

vider

s, log

istics

firm

s an

d inf

orm

ation

tech

nolo

gy in

frastr

uctu

re co

mpa

nies.

• Se

lect k

ey ta

rget

mark

ets an

d ex

amine

cons

umer

pro

tectio

n an

d e-

trans

actio

n law

s.•

Iden

tify

and

selec

t firm

s / c

oope

rativ

es, w

hich

will

ben

efit f

rom

the

pilo

t ini

tiativ

e. Co

mpe

titive

selec

tion

to b

e bas

ed o

n se

veral

facto

rs, in

cludi

ng ex

port

readi

ness

.•

Prov

ide

capa

city-

build

ing a

nd te

chnic

al as

sistan

ce to

sele

cted

firm

s / c

oope

rativ

es,

inclu

ding

: –

Setti

ng u

p a w

ebsit

e –

Onlin

e pay

men

t mod

ality

–Or

der f

ulfil

men

t•

Othe

r fun

ction

s, as

requ

ired.

3•

Five

firm

s /

coop

erat

ives

are

se

lected

• Pil

ot in

itiati

ve is

rolle

d ou

t

MoC

I, AC

CI, A

CEG

/ ass

ocia-

tions

, Mini

stry o

f Com

mun

ica-

tions

and I

nfor

mati

on Te

chno

l-og

y, co

mm

ercial

ban

ks


57

Stra

tegi

c ob

ject

ive

4 : S

treng

then

mar

ket l

inka

ges

and

ente

rpris

e ca

pabi

litie

s to

forg

e / s

usta

in b

uyer

rela

tions

hips

thro

ugh

in-m

arke

t sup

port,

bra

ndin

g an

d st

ream

linin

g of

cus

tom

s pr

oced

ures

Oper

atio

nal O

bjec

tives

Activ

ities

Prio

rity

Impl

emen

tatio

n pe

riod

Targ

etLe

ad a

nd S

uppo

rting

Im

plem

ente

rs1=

high

2=m

ed3=

low

2017

2018

2019

2020

2021

2022

4.2.

Pro

vide

han

d-ho

ldin

g su

ppor

t to

deve

lop

the

Af-

ghan

Car

pets

bra

nd.

4.2.

1. D

evelo

p tar

get m

arke

t pro

files

ser

ving

as a

n es

sent

ial s

ourc

e of

up-

to-d

ate a

nd

relev

ant m

arket

intell

igen

ce in

form

ing A

fgha

n ca

rpet

expo

rters.

• To

pics t

o inc

lude c

onsu

mpt

ion tre

nds a

nd pr

eferen

ces (

e.g. c

odes

of co

nduc

t, cer

tifica

-tio

ns ),

prod

uct d

iversi

ficati

on op

portu

nities

, impo

rt req

uirem

ents

( e.g

. qua

lity, fl

amm

a-bil

ity st

anda

rds,

labell

ing re

quire

men

ts ) an

d pro

cedu

res. A

dditio

nal to

pics c

ompr

ehen

d int

erior

desig

n tren

ds, in

cludin

g sele

ction

of pa

ttern

s and

colou

rs pe

r sea

son o

f the y

ear

A su

stain

able

mec

hani

sm fo

r upd

ating

and

dep

loyin

g th

e m

arke

t pro

files

will

be

de-

velo

ped.

Vari

ous m

edium

s for

dep

loym

ent t

o be

use

d, in

cludi

ng w

ebsit

es, n

ewsle

tters

2•

Ten

mar

ket p

rofil

es a

re d

evelo

ped

and

depl

oyed

• M

echa

nism

for u

pdat

ing

mar

ket

prof

iles i

s in

plac

e

MoC

IAC

CI

4.2.

2. D

evelo

p an

d pr

int li

teratu

re, b

roch

ures

and

prod

uct-s

pecif

ic ca

talog

ues a

nd p

re-pa

re sh

ort f

ilms t

o di

ssem

inate

info

rmati

on re

gard

ing

the

‘mad

e in

Afg

hani

stan’

carp

et ind

ustry

, with

the i

nten

tion

of b

uildi

ng an

d pr

omot

ing A

fgha

nistan

’s br

and

in th

e sec

tor.

Diss

emina

te inf

orm

ation

thro

ugh

relev

ant m

inistr

ies’ w

ebsit

es, c

onsu

lates

, and

in e

xhi-

bitio

ns an

d fai

rs.

2•

A co

mpr

ehen

sive

cam

paig

n is

deve

lope

d, ro

lled

out a

nd u

pdat-

ed a

nnua

lly, i

nclu

ding

the

deve

l-op

men

t of a

t lea

st on

e sh

ort f

ilm

on th

e ‘m

ade

in A

fgha

nista

n’ c

ar-pe

t ind

ustry

Min

istr

y of

For

eign

Affa

irsM

oCI,

ACCI

4.2.

3. C

ondu

ct a f

easib

ility

study

/ as

sess

men

t to

exam

ine

the

poten

tial e

stabl

ishm

ent

/ cos

ts an

d be

nefit

s of g

eogr

aphic

al ind

icatio

ns fo

r sele

ct typ

es o

f Afg

han

carp

ets. T

he

scop

e of

the

asse

ssm

ent w

ill in

clude

the

natio

nal a

s well

as su

bnati

onal

level,

in o

rder

to

affo

rd b

etter

lega

l pro

tectio

n to

Afg

han

carp

ets an

d fac

ilitat

e acti

on fo

r inf

ringe

men

ts.

3•

A fea

sibilit

y stud

y is c

ondu

cted a

nd

polic

ies /

mea

sure

s ar

e in

plac

e,

as re

quire

d

MoC

I ( In

telle

ctua

l Pro

per-

ty O

ffice

)

4.3.

Red

uce

Cust

oms-

rela

t-ed

cha

lleng

es fa

ced

by c

ar-

pet e

xpor

ters

.

4.3.

1. Id

entif

y the

mos

t bur

dens

ome C

usto

ms p

roce

dures

and

com

mon

non-

tariff

mea

s-ur

es co

nstra

ining

expo

rt of

carp

ets.

• Co

nduc

t a re

vision

of C

ustom

s leg

islati

on af

fectin

g carp

et ex

porte

rs in

parti

cular

thro

ugh

a sur

vey,

in or

der t

o str

eam

line e

xpor

t pro

cedu

res. D

evelo

p co

unter

mea

sures

acco

rd-

ingly,

such

as el

ectro

nic su

bmiss

ion o

f trad

e doc

umen

ts an

d tra

nsit-

relate

d pa

ymen

ts to

redu

ce th

e risk

of c

orru

ptio

n.•

Crea

te a t

rade o

bstac

le ale

rt sy

stem

to al

low se

ctor o

perat

ors t

o aler

t relev

ant a

uthor

ities

abou

t trad

e-rel

ated

obsta

cles t

hey f

ace

and

post

reque

sts fo

r ass

istan

ce ( e

.g. d

elays

in

receiv

ing e

xpor

ting

docu

men

ts ). M

echa

nism

to b

e co

ordi

nated

with

a wi

der i

nsti-

tutio

nal n

etwor

k ( in

cludi

ng th

e Ex

port

Prom

otio

n Ag

ency

of A

fgha

nistan

, Afg

hanis

tan

Custo

ms D

epar

tmen

t ).•

Incre

ase

trans

pare

ncy

of tr

ansit

and

bor

der r

egul

ation

s, in

cludi

ng th

e pu

blica

tion

of

fees a

nd fo

rmali

ties f

or ex

porti

ng ( e

.g. p

oster

s in

Custo

ms o

ffice

s ).

• Tra

in C

usto

ms

pers

onne

l on

bord

ers

which

are

key

for t

he c

arpe

t sec

tor (

e.g.

with

Pa

kistan

) on s

tream

lining

expo

rt cle

aranc

e fro

m A

fghan

istan

. Con

duct

aware

ness

-raisi

ng

works

hops

/ ca

mpa

igns

aim

ing to

chan

ge th

e mind

set o

f per

sonn

el.De

velo

p an i

nitiat

ive to

prov

ide s

pecif

ic tra

ining

and m

ento

ring s

ervic

es to

carp

et ex

port-

ers t

o en

able

them

to u

nder

stand

exp

ort p

roce

dure

s and

lega

l obl

igati

ons u

nder

cro

ss-

bord

er C

usto

ms a

utho

rities

.

2•

Revis

ion

of C

usto

ms l

egisl

ation

is

cond

ucted

• Qu

arter

ly tra

ining

s are

pro

vided

to

bord

er C

usto

ms p

erso

nnel

• Ini

tiativ

e is d

evelo

ped a

nd tr

aining

/ m

ento

ring

of 3

0 ex

porte

rs pe

r yea

r

MoF

, MoC

I, AC

CI, A

CEG,

as-

soci

ation

s, Af

ghan

istan

Cus

-to

ms D

epar

tmen

t

4.3.

2. Im

prov

e coo

rdina

tion

with

Cus

tom

s aut

horit

ies o

f neig

hbou

ring

coun

tries

.Th

roug

h bi

later

al di

scus

sions

and

the

estab

lishm

ent o

f coo

pera

tion

mec

hani

sms

and

agree

men

ts ( e

.g. C

usto

ms c

omm

ittee

s for

med

by t

wo n

eighb

ourin

g co

untri

es’ C

usto

ms

auth

oriti

es ),

facili

tate :

• Da

ta ex

chan

ge o

n ca

rpet

trade

betw

een

neig

hbou

ring

coun

tries

.Co

ordi

natio

n with

neig

hbou

rs thr

ough

the e

stabl

ishm

ent o

f an a

ction

plan

for c

ompl

iance

, sm

uggl

ing p

reven

tion

and

coor

dina

ted co

ntro

ls.

3•

Bilat

eral

Custo

ms

com

mitt

ees

are

form

ed w

ith at

leas

t two n

eighb

our-

ing co

untri

es•

Actio

n plan

is de

velop

ed in

coor

di-na

tion

with

Cus

tom

s aut

horit

ies o

f at

least

two n

eighb

ourin

g cou

ntries

MoF

, MoC

I, M

inist

ry o

f For

-ei

gn A

ffairs

, ACC

I, AC

EG /

as

socia

tions

Source: ITC

[ REFERENCES ]

59

REFERENCES

Abbas, Sayed( 2016 ). Let’s Weave Carpet. Afghanistan Rugs and Carpet Centre .

ACCI ( 2014 ). Business Policy Recommendations. Afghanistan National Business Forum, 27 February.

Afghanistan Investment Support Agency ( 2013 ). Investment Opportunities in Textile & Clothing Industry of Afghanistan.

Afghanistan, Ministry of Commerce and Industries ( 2014 ). Investment Opportunities in Afghanistan. Kabul.

Afghanistan, Ministry of Commerce and Industries ( 2011 ). Implementing the SME Strategy : An Action Plan for Developing Afghanistan’s Carpet Sector.

Afghanistan, Ministry of Commerce and Industries ( 2009 ). Afghanistan SME Development Strategy.

Afghanistan, Ministry of Labour, Social Affairs, Martyrs and Disabled ( 2009 ) : Baseline Data for the Quality of TVET Provision in Afghanistan. National Skills Development Programme.

Afghanistan, Ministry of Rural Rehabili tation and Development ( 2007 ). Feasibility Study for Carpet Subsector Plan : Operationalizing Cut and Wash Facilities. Kabul.

Afghanistan, National Skills Development Programme ( 2014 ). Labour Market Intelligence for a Demand Driven Labour Force in Afghanistan.

Afghanistan Research and Evaluation Unit ( 2006 ). Going to Market : Trade and Traders in Six Afghan Sectors.

Centre for the Promotion of Imports from Developing Countries ( 2015 ). CBI Product Factsheet : Hand-woven Rugs in Europe.

DOMOTEX ( 2012 ) Trend Fact Sheet - Flooring Turkey : Some Interesting Facts about the Trends in the Range of Flooring in Turkey.

EastWest Institute ( 2014 ). Afghanistan Reconnected : Regional Economic Security Beyond 2014. New York. Available from www.eastwest.ngo / sites / default / files / adp %20( 2 ).pdf.

Food and Agricultural Organization of the United Nations ( 2015 ). Empowering Women in Afghanistan – Reducing Gender Gaps through Integrated Dairy Schemes. Rome.

Ghiasy, Richard; Zhou, Jiayi and Hallgren, Henrik ( 2015 ). Afghanistan’s Private Sector : Status and Ways Forward. Stockholm International Peace Research Institute and International Council of Swedish Industry.

Global Industry Analysts, Inc. ( 2017 ). Carpets and rugs market trends. Available from www.Strategyr.com / MarketResearch / Carpets_Market_Trends.asp.

Harakat Investment Climate Organization and Afghanistan Chamber of Commerce and Industries ( 2014 ). Private Sector Priorities for Reform for London Conference.

Harakat Investment Climate Organization ( n.d. ). Industrial Analysis Project, Joint Research Program ( co-led by J. Joya and A. Ahmady )

India, Ministry of Textiles ( 2015 ). Note on Handloom Sector.

India, Ministry of Textiles ( 2012 ) Central Wool Development Board – 39th Executive Committee Meeting, 7 February.

India, National Skill Development Corporation ( 2013 ). Human Resource and Skill Requirements in the Handlooms and Handicrafts Sector ( 2013–17, 2017–22 ).

International Labour Organization ( 2015 ). Selecting the Road to More and Better Jobs : Sector Selection Report of the Road to Jobs Project in Northern Afghanistan.

Islamic Republic of Afghanistan ( 2008 ). Afghanistan National Development Strategy.

Italian Trade Commission ( 2011 ). United Arab Emirates Market Report : Luxury Interiors.

ITC ( 2017 ). Reconnecting Afghanistan to global markets – an ITC assessment of export potentials and trade obstacles ( unpublished ).

ITC ( 2016 ). Enhance export capacities of Asia’s least de-veloped countries for intra-regional trade – Afghanistan’s exports to China ( unpublished ).

http://www.eastwest.ngo/sites/default/files/adp (2).pdf

http://www.eastwest.ngo/sites/default/files/adp (2).pdf

http://www.Strategyr.com/MarketResearch/Carpets_Market_Trends.asp

http://www.Strategyr.com/MarketResearch/Carpets_Market_Trends.asp

60


Japan External Trade Organization ( 2010 ). Handbook for Consumer Products – Import Regulations 2010.

Leahy, Rob ( 2012 ). Understanding the market for Afghan rugs, November 7. Available from www.charlestonrugsblog.com / 2012 / 11 / 07 / understanding-the-market-for-afghan-rugs / .

Nasrat, Sayed and Karimi, Abdul Tamim ( 2016 ). The Afghan carpet industry : issues and challenges. Economic Alternatives, Issue 4.

OTF Group ( 2005 ). Information findings of industry research on Afghanistan. Kabul Conference on Regional Economic Cooperation, 4–5 December.

Pain, Adam and Ali, Moharram ( 2004 ). Understanding Markets in Afghanistan : A Case Study of Carpets and the Andkhoy Carpet Market. Afghanistan Research and Evaluation Unit.

Roots of Peace ( 2008 ). Prefeasibility Study of Bamyan Carpet Value Chain. Asian Development Bank Rural Business Support Project JFPR 9100-AFG. Available from http : / / rootsofpeace.org / wp-content / uploads / 2014 / 06 / Bamyan_Carpet_Value_Chain_Pre-Feasability_Study_May-2009.pdf.

Samuel Hall Consulting ( 2014 ). Ties that Bind : Child Labour in the Afghan Carpet Sector. Report commissioned by GoodWeave International. Kabul.

Samuel Hall Consulting ( 2012 ). Research Study to Determine the Priorities for the Implementation of Standards in Afghanistan and Evaluate the Demand for Services of the Afghan National Standards Authority in the Private Sector. Commissioned by the United Nations Industrial Development Organization.

Sri Lanka, Ministry of Industry and Commerce ( 2012 ). Report of the Task Force for a Sustainable Development of the Handloom Industry in Sri Lanka. Colombo.

United States Agency for International Development ( 2006 ). Building a competitive Afghan carpet value chain through in-formed strategy and productive attitudes. Breakfast Seminar #16, December 16. Available from https : / / microlinks.org / library / building-competitive-afghan-carpet-value-chain-through-informed-Strategy-and-productive-atti.

United States Agency for International Development and OTF Group ( 2006 ). Growth Strategy and Action Plan for the Carpet Cluster of Afghanistan.

United States, Department of Commerce, ( 2014 ). Market reports / tariffs textiles, apparel, footwear and travel goods Turkey. Available from http : / / web.ita.doc.gov / tacgi / over-seasnew.nsf / alldata / Turkey.

World Bank ( 2016 ). Afghanistan – Systematic Country Diagnostic. Washington, D.C.

World Bank ( 2016 ). Regional trade & transit : opportunities and challenges for Afghanistan. Background Technical Brief. Washington, D.C.

World Bank ( 2015 ). Afghanistan – Country Snapshot. Washington, D.C.

World Bank ( 2012 ). Afghanistan Diagnostics Trade Integration Study. Washington, D.C. Available from http : / / documents.worldbank.org / curated / en / 373301467992809220 / Afghanistan-diagnostics-trade-integration-study.

World Bank ( 2005 ). Investment Horizons : Afghanistan A Study of Foreign Direct Investment Costs and Conditions in Four Industries. Washington, D.C.




http://rootsofpeace.org/wp-content/uploads/2014/06/Bamyan_Carpet_Value_Chain_Pre-Feasability_Study_May-2009.pdf



https://microlinks.org/library/building-competitive-afghan-carpet-value-chain-through-informed-strategy-and-productive-atti



http://web.ita.doc.gov/tacgi/overseasnew.nsf/alldata/Turkey

http://web.ita.doc.gov/tacgi/overseasnew.nsf/alldata/Turkey

http://documents.worldbank.org/curated/en/373301467992809220/Afghanistan-diagnostics-trade-integration-study



FSC is an independent, non-governmental, not for profit organization established to promote the responsible management of the world´s forests.

Printed by ITC Digital Printing Service on FSC paper, which is environmentally-friendly paper (without chlorine) using vegetable-based inks. The printed matter is recyclable.

Street address: ITC 54-56, rue de Montbrillant, 1202 Geneva, Switzerland

Postal address: ITC Palais des Nations, 1211 Geneva 10, Switzerland

Telephone: +41-22 730 0111 Fax: +41-22 733 4439E-mail: [email protected]: www.intracen.org

This project is funded by the European Union:

ADVANCING AFGHAN TRADEEU Trade-Related Assistance

In collaboration with:

AFGH

ANISTAN

• NATIO

NAL EXPO

RT STRATEG

Y - CARPETS SECTOR •

2018-2022

carpets sector - itc · 2018. 10. 8. · terms of quality standards, food safety, packaging, buying...

Documents