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United States-Afghanistan Joint Statement on the Trade and Investment Framework Agreement (TIFA) Council Meeting

October 09, 2009

WASHINGTON, D.C. - Senior Representatives of the Governments of the United States and Afghanistan met at the Office of the U.S. Trade Representative in Washington today for the fourth meeting of the United States-Afghanistan Trade and Investment Council, the implementing body of the U.S.-Afghanistan Trade and Investment Agreement (TIFA) that was signed by both countries in 2004. Today's meeting demonstrates the continuing close cooperation between Afghanistan and the United States on economic, trade, and investment issues. It manifests the importance both countries place on strengthening a long-term relationship and strategic partnership that broadens our cooperation beyond military and security ties to programs that promote the private sector and economic development. Over the long term, solid economic, trade, and investment policies will create jobs, boost investment, and build sustainable development. The TIFA process also supports our objective of building closer people-to-people ties between our countries. Our discussion built on issues discussed and commitments made at the May 6-7 U.S.-Afghanistan-Pakistan Trilateral meetings in Washington, as well as the last U.S.-Afghanistan TIFA meeting in Kabul in October 2008.

The TIFA process has been a key part of a sustained and multi-faceted high-level engagement between our governments, focused on tackling major economic, trade, and investment challenges. The process is designed to guide and complement the practical work that officials from a wide range of agencies in both our governments carry out daily. At the same time, we strongly encourage private sector input that highlights the challenges that businesses and investors face, so that our efforts are focused on practical solutions that effectively address these issues, helping to create jobs and draw private investment. Strengthening cooperation is particularly important during this difficult global economic downturn.

Our discussions covered five areas: 1) Investment climate issues, including bilateral trade issues; 2) Trade preference programs, including proposals to create Reconstruction Opportunity Zones (ROZs); 3) South and Central Asia regional trade issues; 4) Progress on Afghanistan's accession to the World Trade Organization; and 5) Review of ongoing agricultural cooperation programs by the U.S. Department of Agriculture and U.S. Agency for International Development, and ideas for expanding agricultural and microcredit cooperation.

Our trade capacity-building discussion about Afghanistan's use of the U.S. Generalized System of Preferences (GSP) and Afghanistan and Pakistan ROZ legislation was useful. Economic development, and in particular creation of employment opportunities, is critical for this region. By providing trade-based sustainable development, we hope to improve the lives of Afghanistan's impoverished citizens and reduce extremist attacks on U.S. and allied soldiers working to stabilize the region. The United States presented data on Pakistan's use of U.S. Generalized System of Preferences (GSP) benefits, and the parties discussed how Afghanistan could better utilize those benefits. Both sides also emphasized the importance of beginning feasibility assessments of locations which have been identified for potential ROZs; such studies would also support Afghanistan's many infrastructure and economic development needs.

Afghanistan also actively participated in yesterday's U.S.-Central Asia TIFA meeting. We discussed in more detail Afghanistan's role and the importance of improving trade among South Asian neighbors and between South and Central Asia. Keeping in mind the continuing strong commitment of the United States to support Pakistan and Afghanistan, the parties also noted the need for Pakistan and Afghanistan to successfully conclude by the end of 2009 negotiation of the Afghanistan and Pakistan Trade and Transit Agreement (APTTA) to replace the outdated agreement of 1965.

The parties also discussed a full range of investment climate issues, and the Overseas Private Investment Corporation briefed the delegation on progress of its programs in Afghanistan and discussed areas for possible future cooperation. The United States also congratulated Afghanistan on submission of its Memorandum on Foreign Trade Regime (MFTR) to the World Trade Organization (WTO), an important step toward accession to the WTO, and the parties discussed next steps. The parties also support continuing technical assistance to help the Government of Afghanistan's relevant agencies to improve the standards of Afghan goods destined for world markets.

During the session on agriculture, we reviewed ongoing U.S. Department of Agriculture and U.S. Agency for International Development programs in Afghanistan, suggestions for economic reforms to modernize the sector and improve productivity, and ways we might increase the level of agricultural trade with Afghanistan and its neighbors and between our countries.

In conclusion, our meeting provided an excellent review of key economic, trade, and investment issues, helped to focus our efforts to achieve priority goals, and allowed us to identify new areas for cooperation. With an overarching goal of providing a better quality of life for our peoples, we strengthened our commitment to work together to boost economic development and trade ties between our countries.