The national demand for Afghanistan

Context of firm Strategy, structure And rivalry: • Laws that govern creation, organization, and management of companies exist. • Easy and simple process for registering companies in practice. • Technical governmental entities are problematic being bureaucratic and corrupted. • Rivalry remains in hands of limited players. • Trade agreements are to facilitate free trade with neighboring countries.

CONTEXT OF FIRM STRATEGY, STRUCTURE AND RIVALRY: • Laws that govern creation, organization, and management of companies exist. • Easy and simple process for registering companies in practice. • Technical governmental entities are problematic being bureaucratic and corrupted. • Rivalry remains in hands of limited players. • Trade agreements are to facilitate free trade with neighboring countries.

DEMAND CONDITIONS: • Less sophisticated nature of domestic demand. • Domestic population can be targeted in urban areas for sophisticated products and services, while rural populations can be targeted for less complicated products and services in terms of use and procedures to go through.

RELATED AND SUPPORTING INDUSTRIES: • Afghanistan lacks access to internationally competitive locally based supplying industries for machinery and technology. • Financial Institutions are limited to international donors. • Banks provide loans with high interest rates. • Related clusters are available that supports each other.

Afghan Marble Cluster Diamond:

Marble industry in Afghanistan—as a cluster—has great potential to become one of the key clusters to the growth of the Afghan economy in the future. The Diamond for the cluster clearly illustrates competitive advantages and disadvantages in relation to each of the four attributes on the ground.

Factor conditions:

Quality: almost all reports and studies conducted on Afghan marble have confirmed that the marble in Afghanistan is good quality and in demand e.g. “the quality and quantity of Afghan deposits provides a comparative advantage with the industry can leverage to build a competitive advantage. For example the deposits in Chesht and Khogiani are of top quality white marble very similar to Carrara marble from Italy” (the OTF group, 2006). Afghanistan Investment Support Agency (AISA) states in a report that “there are currently 35 types of marble in Afghanistan and 40 different colors.” (AISA, 2006) Strategic location: Afghanistan geographically is located in a place that can access easily and with less transportation cost the Middle Eastern and Central Asian market. (Mitchell, 2008)Imported knowledge: Some of the Afghan refugee returnees from Iran have brought with themselves experience in conjunction with processing of marble products. Today, many of the skilled labors in the processing plants in Kabul and Hirat provinces are Afghan returnees from Iran.Poor processing plants: The way Afghan marble is processed, limits the exports and creates inefficiencies throughout the value chain. The existing processing plants can only produce small-size slabs, which remain limited to the domestic market only (The OTFgroup, 2006).Marble infrastructure: The word ‘infrastructure’ is not limited to the physical infrastructures only; it also covers the systems and procedures that facilitate development of the cluster. Infrastructures such as roads, power plants, systems and procedures that can facilitate investments is very week and in most cases lack in this country. Specially, power is sporadic and most factories and quarries are forced to rely on expensive generators. This makes the operation cost very expensive and limits investment in the cluster. Security: Poor security profile in some quarrying areas makes the cluster vulnerable and discourages the investors to invest. However, northern, central, and western regions are comparatively better.