In 2009, Harakat Afghanistan Investment Climate Facility was founded with funding of GBP30 million from the UK Government's Department for International Development (DFID). The organization's mission was to remove and reduce regulatory and institutional barriers to doing business in Afghanistan. From 2009-2015, Harakat managed the disbursement of grants to government, public and private sector partners, covering eight priority outcome areas. During this period, Harakat laid the foundation for private sector reform in Afghanistan, successfully implementing 36 projects to address specific barriers to doing business in the country.
Harakat left a legacy of successful interventions for private sector growth that included an A rating in DFID's Project Completion Report. In June 2016, DFID approved the business case for the new Harakat Afghanistan Investment Climate Program to take a four-program approach to increase private sector investment and economic growth in Afghanistan. Harakat is operating for the next seven years with multi-donor funding, including DFID and the Swedish International Development Cooperation Agency (SIDA).
Harakat works with partners across all sectors on investment climate reform projects that will build a better enabling environment for private sector development and growth in Afghanistan.
While it has been correctly said that the private sector is the engine of economic growth, it is equally true that a supportive, healthy public sector creates the climate where growth flourishes. To that end, Harakat works closely with the Government of Afghanistan, strengthening the role of government in this important reform, reconstruction and stabilisation phase in Afghanistan's development. As a non-political body, Harakat connects government with the private sector, to find common reform interests.
Harakat works closely with the private sector, as both a facilitator to identify key areas for reform, and as a project partner. Harakat continues to build on "Private Sector Priorities for Reform Conference" which was held with ACCI in Kabul in 2014. In particular, Harakat works with key stakeholders, including the Office of the President and Ministers, private sector and international partners to advocate for coordination among stakeholders and implementation of private sector reform priorities.
Civil society partners are essential for building transparency, and broad-based demand for reform in Afghanistan. In 2015, Harakat explored several mechanisms for systematically collaborating with civil society partners. The key trend that emerged was how to encourage civil society to pick business and investment as one of their priorities.
Harakat was established with the intent that donors and the private sector fund it. To date, it has received funding from the UK Department of International Development (DFID) (the founder of Harakat) and the Swedish International Development Cooperation Agency (SIDA). Other development agencies, including the World Bank, International Finance Corporation (IFC), United States Agency for International Development (USAID), have either co-financed or collaborated with Harakat on projects, or have supported Harakat as implementing partners.