Afghan President's Brother Denies
Business Success Built On Family Ties
By Qadir Habib, Asmatullah Sarwan
Radio Free Europe/Radio Liberty
March 12, 2009
In a recent profile of Mahmoud Karzai, "The New
York Times" described the 54-year-old brother of
Kabul's preeminent politician as "one of Afghanistan's
most prosperous businessmen."
But Karzai sees himself a bit differently, as a
hardworking and law-abiding businessmen who is
investing in his country's future and wouldn't even
count himself among the top 1,000 wealthiest Afghans.
Uncovering anyone's assets in a country whose
business and ownership structures are as murky as
Afghanistan's is difficult, and
But the nature of the allegations, particularly
against the backdrop of President Hamid Karzai's bid
for reelection later this year, appear to have struck
a nerve with Mahmoud Karzai, who concedes it's "very
difficult to legally make a profit in Afghanistan" but
attributes them to political sniping.
Many of his critics say that Mahmoud Karzai -- who
in addition to a car dealership and coal mining is
involved in numerous real-estate deals and has
interests in the country's only cement factory -- got
where he is through his ties to his brother.
"The only millionaires here are those who abuse
their connections with the government, who steal and
engage in corruption," Mahmoud Karzai tells RFE/RL.
"If my brother was not the president, my business
interests in Afghanistan would still have moved
forward. But I am very careful, because I don't want
my brother to suffer politically because of my
activities, and all these attacks and allegations are
of a political nature."
Mahmoud Karzai, who holds a U.S. passport, owns
four restaurants, a house, car lots, and other
commercial and residential properties in California
and Maryland -- all purchased before he returned to
Afghanistan following the U.S.-led ouster of the
Taliban in 2001.
He says his U.S. holdings have not changed since
that time, and that any money he is making is being
reinvested in long-term development projects to help
rebuild his ancestral homeland.
Karzai says the scope of his business dealings and
his personal fortune was greatly exaggerated in "The
New York Times" report. He offers as an example his
interests in Afghanistan's only cement factory, where
he says he does not even draw a salary.
"The New York Times" listed among his assets "major
interests in the country's only cement factory," and
added that "[Karzai] and other investors assumed
control...when they were the only bidders to show up
with $25 million in cash."
"About the cement factory, I must tell you that I
gave [the 'New York Times' correspondent] the list of
all shareholders, which detailed how many shares were
there and who owned them," Karzai says. "There are
4,500 shares in the cement factory and I only own 300,
but he presents it as if I own the cement company,
which is very wrong."
With millions of dollars in loans from Overseas
Private Investment Corporation (OPIC), a U.S. federal
agency that finances American businesses abroad,
Karzai and his five business partners are building an
ambitious real-estate project in the southern Afghan
city of Kandahar.
Karzai was introduced to officials at OPIC by Jack
Kemp, a former Republican congressman, with whom
Karzai had established a friendship. "The New York
Times" reported that Karzai was also able to secure
10,000 acres of land for the project from Kandahar
officials virtually free of charge.
The land is technically owned by the Afghan
National Army, which has protested the handover of the
land. But Karzai says he and his partners got the land
legally from the city administration in Kandahar.
"This is one of the best housing projects in
Afghanistan," Karzai says of the endeavor, "and we are
investing all its profits back into this project."
He says none of his business partners has "received
anything so far."
"We're giving away these houses very cheap; prices
range from $20,000, and a very big house costs
$110,000," Karzai says. "The other good thing is that
we sell some of the houses to people in need for
He adds that if his group hadn't launched its
project, the land would have "fallen into other
"What we're doing is legal, and we have all the
papers. If the government decides it's not happy and
doesn't want this housing project to be built, we'll
give it back to them," Karzai says. "We're only doing
this for Afghanistan's development, and we're ready to
be held accountable."
Karzai has repeatedly insisted that he never used
his connections with his brother the president to
reward friends or business partners. He has also urged
the Afghan government to more actively promote a
better business environment so it can attract foreign
Mahmoud Karzai says his country is moving in the
right economic direction -- Afghanistan currently has
19 commercial banks, five mobile-phone operators, and
12 satellite TV stations -- but says more reforms are
"People who are overly pessimistic are not right,"
he says. "Afghanistan is undergoing a period of
interesting development. Yes, we need reforms, we need
a new economic policy, and we need a new
land-settlement system. The government of Afghanistan
needs to provide its people with the means to help
rebuild their country, because the government can't do
it alone. And that is my struggle."