The United States Institute of Peace (USIP) recently published a fascinating report on the effect of mobile phones on peacebuilding efforts in Afghanistan. Can the nation’s growing telecommunications sector help decrease corruption, unite the country, and hinder the insurgency?

According to this report by Sheldon Himelfarb of USIP, mobile phones are having a dramatic impact on Afghanistan. Roughly a decade ago, the nation’s telecommunications sector was virtually nonexistent; however, mobile technology has since boomed and now 52 percent of households have mobile phones (including 44 percent of rural households). There are approximately 28 million people who now have access to mobile phones, a recent phenomenon which is connecting citizens across Afghanistan’s sparsely populated terrain. Prior to the last decade, the nation had great difficulty with telecommunications – the rugged terrain and largely rural populace made it virtually impossible to establish fixed lines and stable supplies of electricity. This has changed dramatically since the arrival of the coalition in 2001.

The Afghan government has attempted to promote growth in the telecom sector with the assistance of the United States and other international organizations. There are now five competitors in the market, including both privately and publicly owned companies. Since competitive market conditions were implemented in 2003, the price of telecom services has decreased by roughly 70 percent. Telecom has become the second largest employer of local labor forces behind agriculture, accounts for approximately 15 percent of government tax revenue, and is considered “the fastest growing sector in Afghanistan today” according to the nation’s former minister of communications.

As a result, insurgents have begun to target mobile towers to hinder communications. Roshan, a domestic company, had eighteen of its towers destroyed by the Taliban during the 2009 presidential elections. This has become a serious burden for telecom providers, as each tower costs roughly $250,000. Insurgents have attempted to extort companies by pledging not to destroy towers in exchange for money. As a result, entities like Roshan have developed initiatives such as the Community Protection Plan (CPP) to counter the militants while giving back to local communities (see page 4 of the report).

The growing telecom sector in Afghanistan has resulted in two major changes: 1) enhanced communication between individuals of all thirty-four provinces and 2) an increased number of workers receiving payment via Mobile Money Transfers (MMT). Communication is vital – mobile devices allow citizens to stay informed of current events and directly contact government officials. Crime can be reported and emergency services can respond quicker when phone lines are established for calls. Citizens can also use their mobile phones to access market information such as agricultural prices outside of their immediate area.

MMT is revolutionizing how citizens are collecting payment in Afghanistan. 97 percent of the population is unbanked and there are only thirty-eight ATMs in the country. According to the report, MMT “allows users to deposit and withdraw cash from mobile-based accounts, pay bills, secure microfinance loans, purchase goods with e-currency, and transfer money between users with their mobile phones.” Roshan has provided several private companies in Afghanistan with MMT capabilities, which allows them to pay their employees electronically. As a result, workers are receiving compensation faster in a country notorious for tardy payments. If MMT continues to expand, it will allow the government to deduct taxes at the source and reduce corruption.

If you are interesting in reading USIP’s full report, a .pdf version can be downloaded here.