Opening of the Kabul Serena hotel

President Karzai,
Your Excellencies,
Distinguished Guests,
Ladies and Gentlemen:

It is my immense happiness and privilege to welcome you all as we celebrate the inauguration of one of Kabul’s restored landmarks. I would like to take this opportunity to thank all those professionals, architects, construction trades, staff and volunteers who have worked so hard, under so many constraints, to build this hotel and prepare it for today’s opening.

The presence here of so many government leaders and so many other distinguished guests, marks this event as an important milestone in Afghanistan’s reconstruction and its re-engagement with the world community.

Today’s ceremony is also an occasion to pay tribute to President Karzai and his cabinet for their steadfast commitment to the task of rebuilding this country and helping its people regain their proud nationhood.

Ladies and gentlemen, there are some who will ask: why build an hotel in Afghanistan at this stage of its struggle for development? And why build one of a five star level?

In 2002, the Government of Afghanistan asked the Aga Khan Development Network – the AKDN - to help in restoring Kabul’s hotel capacity, which had been almost totally destroyed by the civil war.

The government wanted to ensure that state visitors, diplomats, government officials, foreign and local investors, donor agency representatives and tourists travelling to Kabul would have acceptable accommodation. The Kabul Hotel had been a notable landmark and centre of activity in the city since it was built in 1945; hence it was an obvious candidate for restoration.

In post-conflict situations, countries must make choices in how to rebuild themselves. One way would be to accept the mediocre or run-of-the-mill and to be satisfied with what is second best. The other way is to see reconstruction as an opportunity to draw upon the world’s state-of- the- art technologies and standards, using them to jump-start the economy and to help bring it to a new and higher plane. I cannot believe that replacing a collapsed society and environment with mediocrity is the right way for a destroyed country to rebuild for its future.

Certainly, Germany, Japan and South Korea, now among the leading economies of the world, have clearly demonstrated in the not-so-distant past that the second approach to post-conflict reconstruction is the one that has the most lasting impact. I believe that is the approach we, AKDN, must take in Afghanistan, just as we have done in other post-conflict situations where we have been engaged, such as Tajikistan, Uganda and Mozambique.

As a significant development asset, the Kabul Serena Hotel is a major commitment within the broader mission of the AKDN’s nine development agencies which work in concert on the many facets of human development. Regardless of gender, origin or faith, the AKDN strives to help the weakest in society to achieve self reliance in improving their lives, guided by the Quranic ethic of a common humanity and the dignity of all mankind.

AKDN affiliate agencies began that mission in Afghanistan in 1995 with refugee resettlement and emergency humanitarian assistance. Since 2001, our agencies have been engaged in longer term development across the full spectrum of human need: economic, social and cultural.

AKDN takes an area-based approach. Drawing on its experience of many years in diverse environments, we have learned that development is an integrated process. This requires us to work simultaneously across multiple sectors, and in spheres both public and private.

Working in close partnership with the Government ensures that, together, we focus on national priorities and address critical issues. We believe that the principal issue is the need to build a vibrant civil society to help develop economic, social and cultural institutions to serve people in rural and urban settings. We have thus been cooperating with the Government in expanding a community development programme through the creation of village-based Community Development Councils, enabling us to direct attention to priorities that people themselves identify. A thousand of these institutions are expected to be functioning by next year.

It is heartening that a recent external evaluation, commissioned by the World Bank, found this AKDN approach innovative and effective in forming credible, legitimate and self-reliant institutions. The report commended the outcome as a significant contribution to democratic governance and civil society development in the country. This observation corresponds to our experience in many countries, similar to that of the United Nations, that a healthy civil society is indispensable to fostering and legitimizing pluralism which itself is the foundation of democratic government. This remains a paramount challenge.

In the health sector, we are training health and medical personnel, the priority being the training of midwives and nurses. The AKDN’s nursing education programme has been endorsed by the Ministry as the national nursing education standard for Afghanistan. Besides many health clinics, the AKDN also manages the Bamiyan Hospital, the province’s only referral centre, whose facilities have been considerably upgraded by us, and a new ward block opened earlier this year.

In education, the AKDN is engaged in the rehabilitation and construction of 132 schools, and is working on curriculum development, teacher education and training in the disciplines related to the management of schools and education programmes.

In the economic sphere, we are using microfinance to support rural development and small scale enterprises. The First Micro Finance Bank and the Rural Micro credit Programme set up by us have a combined loan portfolio of some US$ 12 million, and operate in Kabul, Pul-e-Khumri, Mazar-e-Sharif and Herat. We expect their portfolio to triple by 2007 and their branch network is extending throughout the country. We are building productive infrastructure, including roads, bridges, mini-hydels and irrigation systems that are having a major impact on enhancing access and income opportunities in the areas where we operate.

We are also establishing enterprises, such as this hotel, that we believe are strategic to the national economy. These investments are managed by another AKDN development agency: The Aga Khan Fund for Economic Development, or AKFED. AKFED is dedicated to building economically-sound enterprises in countries of Asia and Africa where foreign-direct investment and management know-how are in short supply, and where many private investors regard the risk as too great. The focus is not on profit, but on people. We seek ways to transfer knowledge and technical capacity to local citizens and to the national economy to generate an economic ripple effect.

This is the AKFED development agenda in the countries where we are active, from Afghanistan to Uganda, almost always at the invitation of the government concerned. All AKFED strategic investments are made in close consultation with the government, focusing on the key sectors of industry, infrastructure, media, financial services, air transport and the leisure industry.

Here in Afghanistan, AKFED has also helped build telecommunications infrastructure with the creation of Roshan, the brand name under which its Telephone Development Company operates. This too was a strategic investment in the light of the extensive damage that the sector had suffered during the hostilities. The Roshan network now serves 45 urban centres and about 100 small towns. Roshan has created more than 500 jobs, making it one of the largest employers in the country. Indirect employment has been much greater, estimated at about 7000. Roshan has contributed in fees, duties and taxes more than $ 50 million to the Government coffers. I believe the contribution that Roshan has made to the country’s unity and productivity has been immeasurable.

Ladies and gentlemen, before I conclude please allow me to explain briefly why we attach importance to our work in the field of culture.

The Aga Khan Trust for Culture has taken on several important projects, beginning with the restoration of historic gardens, the Bagh-e-Babur, the burial site of the founder of the Mughal Empire. We have also restored the Mausoleum of Timur Shah, regarded by many historians as the founder of modern Afghanistan. And we are working in the historic neighbourhood of Asheqan wa Arefan in Kabul, as well as in the Bar Durrani quarter of Herat. Historic cities most often attract the poorest amongst the poor, and therefore rehabilitating these spaces creates new opportunity for the most tragically marginalized.

Our experience in situations as diverse as remote parts of Northern Pakistan, to Delhi, Zanzibar and Central Cairo, is that the restoration of historic communities and important cultural assets serves as a trampoline for economic development. The restoration activity is a source of direct employment for workers and skilled craftsmen, many of whom live in adjacent neighbourhoods. The refurbished facilities themselves become an attraction for tourists, generating more opportunity. And as the residents of surrounding areas find themselves with new sources of income, they spend some of it improving their own homes and neighbourhoods.

These are the pragmatic reasons for revitalizing a nation’s cultural assets. But equally, and perhaps, more important, these activities are restoring and preserving for Afghanistan its historic identity, whose rich pluralist heritage has suffered extraordinary stresses in recent decades. Afghanistan’s historic geographic place at the cross-roads in the flow of goods, ideas, faiths and cultures between East and West, is the very essence of Afghanistan’s international distinctiveness. It is also a heritage for the world to cherish.

Our consistent engagement on the entire development front, in many regions of Afghanistan, has meant, happily, that we have greatly surpassed our initial pledge of $ 75 million, announced in 2002 at the Tokyo conference.

The Aga Khan Development Network and its partners have, together, expended $380 million, of which $150 million – twice our Tokyo pledge - has come from the Network’s own resources. These funds have almost evenly been dedicated, on the one hand, to humanitarian assistance, rural development, health care, education and cultural revitalization; and, on the other hand, to productive economic investments. We are committed to these endeavours, and to scaling them up as circumstances permit.

This is, therefore, an appropriate occasion to acknowledge and thank our partners, who range from the World Bank, Asia Development Bank, the United Nations, and the European Community to the national development agencies of many countries. These last include agencies from Britain and Canada, France and Germany, India, the Netherlands and Norway, Switzerland, Japan and the U.S.A.

Together with the Government and people of Afghanistan, we all share a common goal: to enable the people of Afghanistan to determine their own future and to rebuild their nation.

The underpinning objective is to replace the risk of economic and social collapse with a new capacity, built on informed consent and knowledge capable of sustaining and guiding the transition from poverty to an improved quality of life based on choice and opportunity.

Thank you.