ISLAMABAD: Khyber Pakhtunkhwa Governor Shaukatullah Khan and US Ambassador Richard Olson joined businessmen at a ceremony here on Thursday to celebrate what they called dramatic economic recovery of Swat valley.

They said partnership between the US Agency for International Development (USAID), Khyber Pakhtunkhwa government and business community had led to the recovery of tourism in the valley, generating revenue worth $4.2 million and creating 2,000 jobs.

Speaking on the occasion, Ambassador Olson said that in the wake of conflict and floods that devastated the valley the US and Pakistan governments decided in 2010 to make efforts for recovery of the valley’s economy. He said the efforts helped in creating jobs and improving living condition of people.

The USAID provided grants, technical assistance, and in-kind support, including construction material, supplies and equipment, to 22 fisheries and 239 hotels — more than half of the total number of hotels in the valley. Backed up by this support, the businesses achieved great success. Hotels in valley now earn eight times and fisheries 12 times the revenues they earned before the project began.

The USAID estimates that the tourism industry in Swat valley will continue to grow in 2013, reaching $5 million in revenue.

Historically, tourism has been a key economic driver in the valley and at one time contributed $60 million a year to local economy. Conflicts and floods in 2010 severely damaged hotels and caused a significant decline in revenues, according to the USAID. Fisheries faced similar losses.

To help jump-start economic revival of the region, the USAID in 2010 joined the Provincial Reconstruction, Rehabilitation and Settlement Authority to launch a Swat tourism rehabilitation effort. The US government provided $5.4 million funds for the initiative.

The tourism industry suffered losses in excess of $28 million as a result of conflicts and military interventions during the period from 2006 to 2009 and further losses of $2.1 million due to floods in July, 2010.

The fisheries sector in Swat also affected adversely during this period as production fell from an estimated 60 metric tons per year to a negligible amount. Hotels and fisheries sectors have the highest potential to lead the recovery of Swat’s economy, the USAID said in a statement.

The USAID Firms Project provided direct grants and in-kind procurement support, including construction material, hotel supplies and operating equipment, worth $2.5 million to 239 hotel businesses in Swat.

The project also provided cash grants and in-kind supplies of seed and fish feed, operating equipment worth $330.053 to 22 small and medium enterprises engaged in fish farming in Swat.

The USAID project interventions to bolster tourism in Malakand resulted in the increase of $3.34 million in the sales revenue of partner hotels — from $421,575 in 2010 to $3.76 million in 2012. This represents an eight-fold increase in sales revenue, USAID said.