Laiq Shah had been an authorized dealer for a soft drink company in Lukki, Darra Pizzo in Khyber Pakhtunkhwa (KP) province since 2002. He recalls the fateful day when his business was destroyed. “On the evening of 2nd September 2011 an explosive-laden vehicle exploded in front of my shop while attempting to target the nearby police station. Twenty-eight people lost their lives that day and everything around that area was destroyed. I had luckily closed my shop just 10 minutes before the blast. I was lucky to have made this narrow escape.”
Now Shah is one of 850 small business owners in KP and the Federally Administered Tribal Areas (FATA) in Pakistan who will receive a grant to help rebuild their businesses and lives after the crisis in 2009, which displaced an estimated 2 million people and caused colossal damage to infrastructure and livelihoods. Shah will use his PKR 1,500,000 grant to buy stock and rebuild his livelihood.
Limited Economic Opportunities
KP and FATA have consistently been among the poorest regions in the country. The growth rate in KP was already slowing in the period leading up to the crisis. Similarly, in FATA, the majority of the unemployed were young men, some of whom were enticed by those who offered financial incentives to propagate the crisis. Over time, limited economic opportunities in both KP and FATA have encouraged people to seek employment elsewhere, even outside Pakistan. This has serious social implications.
In 2010, the government and the development partners came together to conduct a Post-Crisis Needs Assessment (PCNA) for KP and FATA. This was a multi-sectoral assessment ascertaining the damage done in the aftermath of the crisis and defining the strategic direction of the rehabilitation effort. The PCNA defined employment and livelihood generation as one of the strategic objectives, recognizing economic deprivation as a key driver of the crisis.
The Multi-Donor Trust Fund (MDTF) for KP, FATA, and Balochistan allocated $20 million to an economic revitalization project for KP and FATA. This project provides support to the crisis-affected Small and Medium Enterprises (SMEs) to facilitate the creation of new jobs and restoration of jobs that were lost during the crisis. It will also mobilize the diaspora to facilitate local and foreign investments in KP and FATA, while improving the overall business environment in these areas. It follows well-defined criteria for selection, including the number of employees which can range from three to 100, operational existence before August 2012, a sound business plan and financial history.
Chief Minister Launches Project
Like other MDTF-financed projects, government ownership is a key principle to ensure that the interventions contribute to rebuilding state-citizen trust. At the project launch in Peshawar on May 9, KP Chief Minister Ameer Haider Khan Hoti handed over checks to the first batch of beneficiaries (right). He acknowledged the contribution of the international community and recognized the resilience of the displaced people as they returned to their homes in Swat and surrounding areas.