Afghans keep market simple

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Afghans keep market simple

Highly low-tech, money system works just fine

Tuesday, October 16, 2001

By JIM MICHAELS
HEARST NEWSPAPERS

KHOJA BAHAUDDIN, Afghanistan -- Sitting cross-legged on carpets in his stall in this busy marketplace, Jalaludin motions a visitor toward the backroom.

"You want to see the bank," the money-changer said, standing up and pulling back a plastic sheet. There he pointed to bundles of Afghan currency stacked knee-high and covering four square feet of carpet.

Jalaludin, an Afghan money changer, waits for a customer in his booth at the Khoja Bahauddin bazaar in northern Afghanistan. The value of the U.S. dollar has fallen here because of the recent influx of foreign journalists and aid workers -- and the prospect that the international community will help stabilize the war-torn country if the Taliban government collapses. Joshua Trujillo / Seattle Post-Intelligencer
Click for larger photo

There is no banking system in Afghanistan, but there is a network of money-changers with a system that has withstood 20 years of war and corrupt governments and may come close to a theoretically pure marketplace.

They don't have computers to deliver the latest Bloomberg financial information or satellites to shower the globe with the Dow Jones News wire. Instead, the money-changers use walkie-talkies to communicate with changers in other towns and villages where the rates are set every morning as the markets open. There is no telephone system, and most roads are nearly impassable.

Jalaludin sits in a stall with carpets spread on the floor and rough-hewn beams across the ceiling. He operates across a glass counter, handling stacks of money and sliding them across the counter to merchants.

Afghanistan is a purely cash economy, even in Kabul and the other cities.

Merchants have to use U.S. dollars to buy goods, principally in Pakistan and Iran. When they sell their wares, they are paid in the local currency, called Afghanis. Merchants must then change the Afghanis back into U.S. dollars to buy products.


	A man uses stones to weigh rice at the Dushanbe Market near Yang Qale in Afghanistan. Joshua Trujillo / Seattle Post-Intelligencer Click for larger photo

This is where the money-changers fit in.

The dollar has been weakened in this village during the past month, thanks to an influx of news reporters and photographers, who pay $100 a day for cars and about the same daily rate for translators.

The dollars flooding the market over the past month have pushed the rate from about 150,000 Afghanis for each dollar to 85,000 Afghanis.

"Reporters and news people come to Afghanistan," said Jalaludin, who like many Afghans goes by just one name. "There is a lot of dollars for this reason."

The U.S.-led bombing campaign has made communications between money-changers difficult, but they have never let the battle lines interfere with commerce. Changers in resistance-held territory in the north regularly set rates with their counterparts in those parts of Afghanistan controlled by the Taliban.

"We don't have contact with Taliban," Jalaludin said. "But we do business with merchants who live in Taliban areas."

Hayalullah, a local money-changer, said political stability will eventually stop the swings in exchange rates. "The situation will be good again," he said.

In countries such as Afghanistan, where getting information is difficult and lifting the veil on how Afghans live their daily life is difficult for Westerners, the market provides a degree of transparency.

The bazaar is already selling the daily food rations that U.S. forces are airdropping throughout Afghanistan as part of a humanitarian relief effort. A mule lumbered through town here recently laden with the rations in yellow plastic displaying the U.S. flag.

They are similar to military rations and include peanut butter, beans and rice and other prepackaged vegetarian meals. Each yellow-wrapped packet sells for the equivalent of about 50 cents in the marketplace.

The stalls in most bazaars sell the same packaged biscuits and dusty goods from Pakistan and Iran. Medicines are spread out on blankets. Some stalls hold boxes of inexpensive watches or nails, after making the tough journey by truck or mule from neighboring countries. Large piles of black tea, walnuts, pecans and other produce are on display.

Hashish is also sold openly in markets.

There also is no shortage of weapons.

Merchants said they have been ordered in recent weeks to stop selling arms, but weapons are so plentiful that Kalashnikov rifles can be had for about $150 each, according to Mahbubullah, a money-changer here.

In an old market in Yang Qale, merchants sat behind piles of rice, while nearby men squatted by fish frying in a large pan.

Hundreds of men and children stopped what they were doing and began following a Western woman visiting the market. The crowds became so thick that at one point a man began swinging his Kalashnikov at people to break up the crush of spectators.

Jim Michaels is on assignment in Afghanistan for Hearst Newspapers, along with P-I photographer Josh Trujillo. Michaels is an assistant managing editor of the Albany Times Union.