When I imagine the holy grail of sustainable development in a rural Afghan province, it is a cycle of inclusive economic growth and investment which, in turn, finances social development efforts with a high level of community engagement. This dream took a significant step closer to reality this week.
I'm proud to announce that the United States government has signed a memorandum of understanding to establish a new and innovative public-private partnership in Afghanistan with the Aga Khan Foundation. This MOU establishes the framework for USAID's work with AKDN to create a ground-breaking private sector-led model for development in Afghanistan - a model that focuses on economic growth and sustainably.
Both USAID and AKDN firmly believe that Afghanistan's development will depend heavily on the Afghan private sector and economic growth. With the support of the Department of State, USAID and AKDN will seek to foster such growth by focusing on private financing of social development. With investments in the Afghan private sector, USAID will turn profits into social development funds, using private sector financing to help solidify the health, education, economic and governance gains made in Afghanistan over the past ten years.
Over a five year period, USAID and AKDN will each commit to investing $30 million to leverage private sector investments into social development projects as well as provide direct social development assistance. Proceeds from USAID's investments will be invested exclusively inside Afghanistan. Our support will center on economic activities that promote cross border trade and regional integration, especially in agribusiness, governance and civil society, market development, health, energy, extractives and manufacturing.
Our shared goal is to leverage the private sector to advance social development. Creating jobs and business through this project should lead to a "virtuous cycle" where economic development is self-enabling and self-sustaining as these for-profit incubators serve as future funding mechanisms for development efforts.
