Latest news
تصویر بندانگشتی

Economic Impact of 20-Year Intl Presence in Afghanistan

The last two decades of major international presence in Afghanistan caused a huge influx of funds and investment which enabled Afghanistan's economy to grow, economic analysts say.

The economic achievements, however, according to the analysts, have become fragile following the hasty and full withdrawal of foreign forces and the closing of foreign diplomatic missions.

According to the numbers, Afghanistan's economy witnessed a growth of 21 percent in the last 20 years, especially in 2007, and huge private and public investments, especially in construction projects, have changed the face of major cities.

According to officials from the Afghanistan Chamber of Commerce and Investment (ACCI), the private investments on different projects reached around $4 billion a year.

As a result of aid money and investment flowing in, the rate of poverty decreased and hundreds of trade, transport, banks, and services companies started operations in Afghanistan.

“In the past years, around 50 to 60 billion USD has been invested in mining and other services in Afghanistan because there was the demand for such investments,” said Khan Jan Alokozay, the deputy head of ACCI.

The United States figures show that the US government has spent around two trillion dollars in Afghanistan, an amount equal to the Marshal Plan which was invested in the rebuilding of Europe after World War II.

The former Afghan government, however, said that the on-budget accumulated US funds to Afghanistan amounted to around $80 billion.

A number of economic analysts say the huge amount of money spent in Afghanistan in the last 20 years could have resulted in much more economic development but most of the funds were either embezzled or funneled back to the donor countries. According to them, most of the implemented projects also have not been sustainable.

“Our economy had turned into a mafia economy. A limited number of individuals were in charge of most of--around 90 percent of--Afghanistan’s capital,” said Sayed Massoud, an economic analyst.

“If someone does an assessment, it will clearly show that the former governments and the foreigners have failed (to implement projects) and have caused the promotion of corruption, an economic mafia and the embezzlement of aid funds,” Alokozay said.

However, the 20-year international presence has also helped Afghanistan build close economic and trade relations with world and regional countries.

In the past years, Afghanistan gained membership in several regional and international organizations and economic institutions such as the World Trade Organization and World Road Transport Organization.

Afghanistan also connected to the world with big regional projects such as the Turkmenistan, Afghanistan, Pakistan and India gas pipeline (TAPI), the Central Asia-South Asia power project (CASA-1000), the regional railroad project, and the Lapis Lazuli Trade and Transport Route.

However, despite the signs of progress and development, Afghanistan still struggled with economic problems and now the country’s economy is in a very bad situation, according to analysts.

“Several economic mafias and their competition" affected the mining industry, Massoud said.

“In Afghanistan, around 18 million people are struggling with poverty and lack of food, and we have to work hard for the continuation of international funds,” said Tariq Farhadi, an advisor to the former president.

After 20 years of relative economic growth and aid, once again Afghanistan’s economy is experiencing an economic downturn.

Following the collapse of the former government, the United States and NATO countries have closed their embassies in Kabul and suspended their economic support.

Now, according to figures, Afghanistan’s economic growth is below zero, the banks are unable to repay people’s deposits, investors are taking their money out of the country, most government employees are jobless and there are no public services offered to the people.  

Economic Impact of 20-Year Intl Presence in Afghanistan

After 20 years of relative economic growth and aid, once again Afghanistan’s economy is experiencing an economic downturn.

تصویر بندانگشتی

The last two decades of major international presence in Afghanistan caused a huge influx of funds and investment which enabled Afghanistan's economy to grow, economic analysts say.

The economic achievements, however, according to the analysts, have become fragile following the hasty and full withdrawal of foreign forces and the closing of foreign diplomatic missions.

According to the numbers, Afghanistan's economy witnessed a growth of 21 percent in the last 20 years, especially in 2007, and huge private and public investments, especially in construction projects, have changed the face of major cities.

According to officials from the Afghanistan Chamber of Commerce and Investment (ACCI), the private investments on different projects reached around $4 billion a year.

As a result of aid money and investment flowing in, the rate of poverty decreased and hundreds of trade, transport, banks, and services companies started operations in Afghanistan.

“In the past years, around 50 to 60 billion USD has been invested in mining and other services in Afghanistan because there was the demand for such investments,” said Khan Jan Alokozay, the deputy head of ACCI.

The United States figures show that the US government has spent around two trillion dollars in Afghanistan, an amount equal to the Marshal Plan which was invested in the rebuilding of Europe after World War II.

The former Afghan government, however, said that the on-budget accumulated US funds to Afghanistan amounted to around $80 billion.

A number of economic analysts say the huge amount of money spent in Afghanistan in the last 20 years could have resulted in much more economic development but most of the funds were either embezzled or funneled back to the donor countries. According to them, most of the implemented projects also have not been sustainable.

“Our economy had turned into a mafia economy. A limited number of individuals were in charge of most of--around 90 percent of--Afghanistan’s capital,” said Sayed Massoud, an economic analyst.

“If someone does an assessment, it will clearly show that the former governments and the foreigners have failed (to implement projects) and have caused the promotion of corruption, an economic mafia and the embezzlement of aid funds,” Alokozay said.

However, the 20-year international presence has also helped Afghanistan build close economic and trade relations with world and regional countries.

In the past years, Afghanistan gained membership in several regional and international organizations and economic institutions such as the World Trade Organization and World Road Transport Organization.

Afghanistan also connected to the world with big regional projects such as the Turkmenistan, Afghanistan, Pakistan and India gas pipeline (TAPI), the Central Asia-South Asia power project (CASA-1000), the regional railroad project, and the Lapis Lazuli Trade and Transport Route.

However, despite the signs of progress and development, Afghanistan still struggled with economic problems and now the country’s economy is in a very bad situation, according to analysts.

“Several economic mafias and their competition" affected the mining industry, Massoud said.

“In Afghanistan, around 18 million people are struggling with poverty and lack of food, and we have to work hard for the continuation of international funds,” said Tariq Farhadi, an advisor to the former president.

After 20 years of relative economic growth and aid, once again Afghanistan’s economy is experiencing an economic downturn.

Following the collapse of the former government, the United States and NATO countries have closed their embassies in Kabul and suspended their economic support.

Now, according to figures, Afghanistan’s economic growth is below zero, the banks are unable to repay people’s deposits, investors are taking their money out of the country, most government employees are jobless and there are no public services offered to the people.  

Share this post

Comment this post