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Analysts: Afghan Economic Future Requires Govt Plan

The withdrawal of international troops will threaten the country’s economy and the future of investment in Afghanistan, analysts told TOLOnews, adding that there is a need for proper planning by the government to control the situation. 

The investors said the government lacks proper plans to boost investment and to preserve the existing businesses in the country. 

Some representatives of the private sector said that a lack of investment guarantees has pushed many investors to leave the country over the last few months. 

“Even right now, the government’s budget in fact has a special dependency on international aid and the government itself is dependent in terms of international support and morale,” said Sayed Massoud, an economic affairs analyst and a university lecturer. 

Other analysts said that if peace is ensured, such challenges will be addressed as soon as some plans are formed by the international community to support the achievements in the economy after US and coalition troops leave Afghanistan. 

“There is a need to think about the economic dimensions of a responsible withdrawal. If so, the Afghan private sector, which is new, will be helped,” said Samim Sarim, an economic affairs analyst. 

But the Ministry of Economy said that the international community will maintain its commitment to Afghanistan after the withdrawal of foreign troops from the country. 

“This withdrawal is only a military withdrawal. The political, economic, technical, and financial support of the international community to Afghanistan will continue,” said Saboor Nariman, a spokesman for the Ministry of Economy. 

The World Bank in a report released in April said that Afghanistan faces the prospect of sluggish economic recovery from COVID-19 amid continued political uncertainty and the possible decrease of international aid. 

The report titled “Setting Course to Recovery” said that robust agricultural growth has “partially buoyed Afghanistan’s economy, which shrunk by around two percent in  2020—a smaller contraction than previous estimates.” But it said that lockdowns, weak investment, and trade disruptions have hit hard services and industries, increasing hardship and unemployment in cities. 

The report said that full recovery will be challenging as many firms have closed and jobs were lost.  
The World Bank said that private sector confidence has weakened amid difficult security conditions, uncertainty about the outcome of the ongoing peace talks, the possible withdrawal of international troops, and potential sharp declines in future international aid support. 

Moreover, the Asian Development Bank in a report in April said that Afghanistan’s economic growth is expected to recover this year and accelerate next year after a sharp decline in  2020 from the coronavirus pandemic as well as unrelenting violence and instability. 

In its Asian Development Outlook (ADO ) 2021, ADB forecasts Afghanistan’s gross domestic product (GDP) growth to rebound to 3.0% in  2021, rising to 4.0% in  2022 as business activity and market sentiment normalize.

Analysts: Afghan Economic Future Requires Govt Plan

Investors said the government lacks proper plans to boost investment and preserve the existing businesses in the country.

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The withdrawal of international troops will threaten the country’s economy and the future of investment in Afghanistan, analysts told TOLOnews, adding that there is a need for proper planning by the government to control the situation. 

The investors said the government lacks proper plans to boost investment and to preserve the existing businesses in the country. 

Some representatives of the private sector said that a lack of investment guarantees has pushed many investors to leave the country over the last few months. 

“Even right now, the government’s budget in fact has a special dependency on international aid and the government itself is dependent in terms of international support and morale,” said Sayed Massoud, an economic affairs analyst and a university lecturer. 

Other analysts said that if peace is ensured, such challenges will be addressed as soon as some plans are formed by the international community to support the achievements in the economy after US and coalition troops leave Afghanistan. 

“There is a need to think about the economic dimensions of a responsible withdrawal. If so, the Afghan private sector, which is new, will be helped,” said Samim Sarim, an economic affairs analyst. 

But the Ministry of Economy said that the international community will maintain its commitment to Afghanistan after the withdrawal of foreign troops from the country. 

“This withdrawal is only a military withdrawal. The political, economic, technical, and financial support of the international community to Afghanistan will continue,” said Saboor Nariman, a spokesman for the Ministry of Economy. 

The World Bank in a report released in April said that Afghanistan faces the prospect of sluggish economic recovery from COVID-19 amid continued political uncertainty and the possible decrease of international aid. 

The report titled “Setting Course to Recovery” said that robust agricultural growth has “partially buoyed Afghanistan’s economy, which shrunk by around two percent in  2020—a smaller contraction than previous estimates.” But it said that lockdowns, weak investment, and trade disruptions have hit hard services and industries, increasing hardship and unemployment in cities. 

The report said that full recovery will be challenging as many firms have closed and jobs were lost.  
The World Bank said that private sector confidence has weakened amid difficult security conditions, uncertainty about the outcome of the ongoing peace talks, the possible withdrawal of international troops, and potential sharp declines in future international aid support. 

Moreover, the Asian Development Bank in a report in April said that Afghanistan’s economic growth is expected to recover this year and accelerate next year after a sharp decline in  2020 from the coronavirus pandemic as well as unrelenting violence and instability. 

In its Asian Development Outlook (ADO ) 2021, ADB forecasts Afghanistan’s gross domestic product (GDP) growth to rebound to 3.0% in  2021, rising to 4.0% in  2022 as business activity and market sentiment normalize.

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