April 30, 2021

Van Hollen, Young, Cantwell Introduce Bipartisan Pakistan-Afghanistan Economic Package to Promote Stability in the Region As U.S. Military Plans Afghanistan Exit

With the U.S.-announced troop withdrawal from Afghanistan, it is vital that we use all the tools at our disposal to promote lasting peace and economic opportunity and to achieve other vital political objectives in the region. Today, U.S. Senators Chris Van Hollen (D-Md.), Todd Young (R-Ind.), and Maria Cantwell (D-Wash.) introduced the bipartisan Pakistan-Afghanistan Economic Development Act, legislation to establish Reconstruction Opportunity Zones (ROZs) in Afghanistan and Pakistan’s border regions to allow textile and apparel goods from these areas to enter the U.S. duty-free. The creation of ROZs will shape conditions on the ground in a positive way, generating economic benefits for Afghanistan and Pakistan and laying the groundwork for a more stable region.

The text of the legislation can be found here. A one-pager on the bill can be found here.

“As American troops leave Afghanistan, we have a strong interest in encouraging all parties to achieve a peaceful settlement and political reconciliation that can bring stability to this war-torn and war-weary area. That means using our influence to facilitate the growth of economic opportunity for those in the region. That’s what our bipartisan bill will do. Through these trade incentives, we can help people in the region see a path to a successful future and build on our larger objectives of promoting political and civil rights – especially those of women and girls. This legislation would serve as a vital tool in the Administration’s efforts, and I’ll be working to get it passed,” said Senator Van Hollen, who raised the Pakistan-Afghanistan ROZ proposal in Tuesday’s Senate Foreign Relations Committee with Zalmay Khalilzad, the U.S. Special Representative for Afghanistan Reconciliation. As a member of the House of Representatives, Senator Van Hollen authored similar legislation which passed in 2009.

“The United States accomplished the mission we set out on in 2001 in Afghanistan, and we have made clear gains in security, opportunity, and economic freedom over the past two decades. As American troops return home, it is important that we continue to promote the stability they helped create. This legislation will do that by encouraging businesses in Afghanistan and Pakistan to trade with the United States, creating economic benefits that endure well into the future,” said Senator Young. 

“Creating ROZs will promote economic opportunities as alternatives to extremism and narco-trafficking. Our country’s national security is too important to ignore the fact that too many Pakistanis and Afghanis are resorting to any means necessary to support their families. ROZs will give the people of Afghanistan and Pakistan new opportunity,” said Senator Cantwell.

Bill Details

Eligibility Criteria: In order for an area to be designated as a ROZ, Pakistan and Afghanistan must fulfill a number of conditions:

·       Economic reforms: market-based economy; anti-corruption measures; eliminating barriers to U.S. trade and investment; and increasing availability of health care and educational opportunities.

·       National security: no activities that harm U.S. national security interests or support for international terrorism.

·       Human and labor rights: elimination of human rights abuses and protection of core labor standards.

Duty-Free Treatment: The President will determine which products, from a specified list of textile and apparel goods, will be eligible for duty-free treatment. These products represent a range of goods commonly imported to the U.S. from Pakistan and Afghanistan.

Protections Against Unlawful Transshipment: The President must determine that Pakistan and Afghanistan have adopted laws to prevent unlawful transshipment and allow U.S. Customs and Border Protection (CBP) access to investigate allegations of unlawful transshipment. Violating transshipment rules will result in a 5-year denial of duty-free shipment for articles of the violator.

Worker Protections: The bill lays out a program and reporting requirements for technical assistance and capacity building, focusing on providing labor protections to workers in ROZs. It also requires Pakistan and Afghanistan to designate a labor official to monitor compliance and labor standards of registered textile firms.

Termination Authority: The President has the authority to withdraw, suspend, or limit the application of the ROZs if conditions on the ground do not support U.S. national interests.