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Thursday, July 11, 2013

Germany and the Free Rider Problem

As this Wikipedia article notes, "A free rider, in economics, refers to someone who benefits from resources, goods, or services without paying for the cost of the benefit." 

Germany is a free rider when it comes to Afghanistan. It has provided little in support of the military operations there, yet wants to exploit the benefits. From DW News:
Afghanistan is rich in resources. The first German-Afghan dialogue on natural resources aims to create perspectives for mineral deposits. But there are many obstacles ahead.
Afghanistan should no longer be equated with terrorism, but with natural resources. That, at least, is the aim of the first German-Afghan dialogue on resources, which takes place on Friday, July 5, in Berlin.
According to Afghan authorities, the country is in possession of over 2.3 trillion euros worth of natural resources. Among these resources are rare earth minerals, lithium, iron, tungsten, copper, lead, zinc, among others. It is especially lithium and rare earths which interest Germany as an industrial country. They are used, for example, in the manufacturing of turbines for wind energy.
The Afghan Minister of Mines and Petroleum Wahidullah Shahrani and other Afghan government representatives are in Berlin to create a foundation for cooperation. Afghanistan can profit from its resources, says Shahrani, adding that Germany is one of Kabul's first choices in terms of economic cooperation.
"We have intensified our cooperation with Germany," he said, because the country is one of the largest buyers of minerals. "There are already a number of German consulting companies active in Afghanistan."

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