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FEATURE STORY February 4, 2020

New Knowledge and Skills Transform Small Enterprises in Balkh Province

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Fazluddin Nazari is one of the over 100 small entrepreneurs in Balkh province of Afghanistan whose businesses have been improved after receiving training and support from Afghanistan Rural Enterprise Development Program.

Rumi Consultancy/ World Bank


Story Highlights:

  • Over 100 small enterprises in Balkh province are on track to expand after receiving training and support that helped them better manage their businesses and promote their products.
  • This is one of many successful results of the Afghanistan Rural Enterprise Development Program that closed in June 2018. The government program helped transform businesses, including a company dealing in carpets and another producing handicrafts.
  • A new government project, the Women's Economic Empowerment Rural Development Project, will focus on working with poor rural women, who have little or no access to credit and income-generating activities, to help them develop sustainable enterprises and improve their access to finance.

MAZAR-E-SHARIF, Balkh Province – On a warm, early morning, Fazluddin Nazari, 30, is sitting in his carpet store examining new carpet designs to decide which ones to approve for weaving. The store is filled with neatly stacked colorful carpets. He puts aside the preferred designs and asks his father’s opinion. 

Later, Fazluddin explains to a customer: “All our carpets are hand woven by Afghans from Afghan wool. The quality is great.” Fazluddin entered the family business as a young man. His 56-year-old father Haji Mohammad Nazar inherited the business from his forefathers. For more than 20 years, his father worked to keep the business going, but did not have enough customers or a strategy to resolve their marketing and financial management issues.

“Our business was small,” recalls Fazluddin, “we had only a few customers from Kabul and some provinces of Afghanistan and we did not know how to expand our work.” However, their business transformed after receiving support from the Afghanistan Rural Enterprise Development Program (AREDP) in 2011. “AREDP support helped us expand our carpet store into a company,” he says.

Fazluddin and his father now run their own company, Haji Mohammad Nazar and Sons Carpet, in Mazar-e-Sharif city, Balkh province, in northern Afghanistan. Over 300 people work in the company—a significant increase to the 50 people they employed previously. In supporting established enterprises in the cities, such as Fazluddin’s, AREDP, which closed in June 2018, helped ensure employment opportunities in the rural areas. “Helping us means helping the farmers and people living in rural areas, because they are the people who weave the carpets for us,” Fazluddin points out.

Through AREDP, Fazluddin participated in over 10 national and international exhibitions in Balkh, Kabul, and India. “We participated in exhibitions in India three times, where we found new customers. Now, we send our carpets to countries like India and Turkey in addition to the local market. Thanks God! Our work is going well,” says Fazluddin, who is working to expand the business further.

He and his father also received training in accounting, marketing, business management, and health and environment through AREDP. The training enabled Fazluddin to create and organize the company’s financial system, allowing him to maintain a proper track of cash flow and income and expenditures. The training also enabled him to develop business promotion tools, such as business cards, brochures, and posters.

AREDP was a program of the Ministry of Rural Rehabilitation and Development (MRRD). It aimed to increase income and sustainable employment opportunities for men and women through supported rural enterprises. The program received funding support from the Afghanistan Reconstruction Trust Fund (ARTF), managed by the World Bank on behalf of 34 donors, and the International Development Association (IDA), the World Bank Group’s fund for the poorest countries.

Among other activities, (65 percent managed by women) and 800 (15 percent female) small and medium enterprises (SMEs) that were selected for their potential as key drivers of rural employment and income generation.


"AREDP was a good program as their support improved our work and enabled us to compete in the Balkh market."
Soraya Ahmadi
entrepreneur, Balkh province

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Afghanistan Rural Enterprise Development Program (AREDP) has provided technical support to over 1,768 Enterprise Groups and 800 small and medium enterprises to strengthening market linkages and value chains.

Rumi Consultancy/ World Bank



Building Business Relations

Haji Mohammad Nazar and Sons Carpet Company was one of 144 SMEs that received support from AREDP in Balkh province.

“AREDP activities worked to standardize branding and quality of most of the materials produced by the enterprises,” says Humayoun Najafizada, who was AREDP provincial coordinator in Balkh province. “In addition, by sending them to exhibitions, AREDP helped the enterprises connect with national and international business people.”

Soraya Ahmadi, 40, was one such entrepreneur from Balkh province who participated in trade exhibitions, which allowed her to learn about businesses in other Afghan provinces and countries. These opportunities, she says, allowed her to establish business relations and improve her business. “The project sent me to exhibitions in India where I learned how I should work on new designs and standardize my products,” she says.

Soraya runs Durukhshan Shamal Handicraft, a business registered with the Ministry of Industry and Commerce. “AREDP was a good program as their support improved our work and enabled us to compete in the Balkh market,” says Soraya, who started a small sewing business in her house more than 10 years ago, investing 13,000 afghanis (about $182)* in it. The turning point in her handicraft and tailoring business came in 2014 when Soraya received the AREDP support. She expanded her business, using the technical training she received through AREDP.

“There were many projects in Balkh that came to help us, but only AREDP did what they promised,” says the mother of five. She works with more than 50 women producing handicraft in their homes and employs 15 women, most of whom are tailors. She has received many contracts from local hospitals, schools, Balkh Municipality, and other businesses, sewing uniforms and clothes.

Increase Empowerment of Rural Women

Many more rural women will be able to develop into entrepreneurs like Soraya under a new MRRD project, the Women's Economic Empowerment Rural Development Project (WEE-RDP).

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Supported by ARTF and the World Bank AREDP project has helped many Afghan women across five provinces to operate small and medium enterprises and financially become independent. Photo Credit: Rumi Consultancy/ World Bank

The project works to increase women’s participation in sustainable community-level institutions, which are provided technical and financial support to enable social and economic empowerment. Through the building of these institutions, WEE-RDP will help the women develop enterprises and improve their access to financial services providers such as microfinance institutions. The project is supported by the ARTF and IDA.

*All U.S. dollar equivalents are based on the rate $1=71.06 afghanis (May 2018)



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