| Amid Kabul's poverty, supermarket buzzes The Boston Globe
01/31/2004
By Victoria Burnett
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Diplomats, journalists, aid workers, others have money to spend KABUL, Afghanistan -- Assad "Chelsea" Mehedizada cradles a mobile phone under his chin as he bags groceries with one hand and punches prices into a calculator with the other. It is late afternoon and the stream of callers and customers is constant. It may not be Whole Foods Market, but business is brisk at Chelsea, the store Mehedizada opened in August. It claims the distinction of being Afghanistan's first supermarket. Through the gray afternoon, Afghans and expatriates wander aisles stacked with everything from Raisin Bran to Lavazza coffee and Bonne Maman apricot jelly. Strings of colored lights wink in the window, and the theme from "The Godfather" floats over the perfume counter at the rear. "I wanted to have a shop that was as good as stores abroad," said Mehedizada, whose family opened its first store 65 years ago and spent $1 million to set up the new, white-floored market with its long aisles. A vibrant retail sector has blossomed around the flush community of foreign aid workers, diplomats, and journalists who have poured into Kabul in the two years since the fall of the Taliban regime. The commercial district of Shar-e-Naw, where Mehedizada has his store, is a blur of colored neon and bright, laminated signs. Around the corner, narrow Flower Street is lined with shops stacked with imported food, bootleg DVDs, and electronics. Afghanistan is one of the poorest countries, with an annual per capita income of about $200, and only a minute percentage of Kabul's residents could afford to put their nose through the door of a shop selling $6 chocolate bars. But many retailers are targeting a growing community of Kabul consumers, among them refugees returning with capital from overseas and business people profiting amid an expansion fueled in part by aid dollars and money from the opium trade. "All kinds of people come in here -- aid workers, traders, business people," said Mehedizada, who reckons 10 to 20 percent of his customers are local. The country's domestic output rose about 30 percent in the year ended in March, to $4 billion, according to a report by the International Monetary Fund. The IMF said the agricultural sector, which represents about half the official economy, grew about 28 percent as irrigation systems were repaired and five years of drought ended. Money from the opium industry has seeped through the economy, fueling consumption and an explosion in construction. The United Nations Office on Drugs and Crime estimates the country's poppy farmers and drug traffickers earned about $2.5 billion in 2003. Shah Mahmood Ghazi, an engineer who returned to Afghanistan in mid-2002 after 10 years in Holland, had just bought a $48 bottle of Hugo Boss perfume for his wife, a dentist. He is in the construction business, and owns a house in the fashionable neighborhood of Wazir Akbar Khan, which he rents to a foreign nonprofit agency for "several thousand" dollars per month. "We come here to walk around and see what new things have come in," said Ghazi, who lives in a Soviet-built middle-class apartment block. "Everything we had was burned or lost or stolen, so we're still building back up." Just down the street from Chelsea Supermarket, Haji Ghulam Hassan sits in his office in Roshan City Tower, the department store he opened in November. "Day by day the market's growing. There are more and more people in a position to buy," he said. Taking a bet on his hunch, Hassan -- who ran a shop on the ground floor of the building for 35 years -- bought out the owners of the other floors. He is constructing a 10-story building behind City Tower and plans to link them to make one huge store. Outside his office, couples browse through racks hung with coats from Russia and Turkey, Italian shirts, and Iranian women's wear. A crude sign at the bottom of the cement stairway directs shoppers to apparel on the second floor, electronics on the third. "It's a big investment -- probably bigger than you can imagine," said Hassan, who declines to say exactly how big that is. Mohammad Amin Rasouli, partner in a small car salesroom near Shar-e-Naw, said he sells a dozen cars each month, from $5,000 Toyota Corollas to the occasional $50,000 SUV. Most of his customers are Afghan, he said -- government officials, former jihadis, or leaders in the holy war, business people, and Afghans working for foreign aid agencies. Many buy cars to rent out to foreign organizations, he said. Businesses like Mehedizada's and Hassan's are the seeds of economic recovery, say economists with a close knowledge of the country. But Afghanistan needs to pull in substantial, long-term investments if it is to see sustainable economic growth. So far, the sectors beyond retail and construction that have attracted the most investment are telecoms -- Afghanistan now has two commercial mobile-phone networks -- and hotels, including a $25 million hotel project by the Aga Khan Fund for Economic Development and a planned $40 million Hyatt. For his part, Mehedizada is already moving on to new plans. He hopes to open an eight-story department store soon that would sell household goods, electronics, and clothes. He also has plans for supermarkets in the provincial capitals of Herat, Kandahar, and Mazar-i-Sharif. "The years of war squeezed Afghanistan like an orange. All that's left is the skin," he said, surveying his supermarket from the counter where he seems to be a permanent fixture. "When people come here and tell me this is the best shop in Afghanistan, it makes me very proud."
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