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Afghani falls to record low amid pressing currency shortage

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Economists are warning of an acute currency shortage in Afghanistan and the subsequent economic predicament as the Afghani has plummeted to its record low in trading.

The United Nations Development Programme (UNDP) issued a report earlier this week urging prompt actions to prevent the Afghan banking system from collapsing, which is now “in disarray” featuring inadequate liquidity and decreased deposits.

The largest currency exchange market in Kabul now has been crowded with people and the Afghani has dropped to its all-time low.

Before the Islamic Emirate of Afghanistan (IEA)’s takeover of Kabul in mid-August, one U.S. dollar was equal to about 70 Afghanis. But now the exchange rate hovers around 90 Afghanis to the dollar. The continued depreciation of the Afghan currency sparked fears among residents, with many flocking to the exchange market.

“Unfortunately in these two weeks the Afghan currency has been dropping down against foreign currencies with one dollar costing 95.5 Afghanis last week. Then the Afghanistan Bank released a statement that they will put 10 million U.S. dollars into the market, more than the 2.5 million dollars they actually took out. However, the price [of the U.S. dollar] didn’t go down but unfortunately have increased day by day,” said Zirak, spokesman from the all money dealers of Afghanistan.

Zirak said the country’s currency shortage was fueled by the combination of its assets frozen by the United States, the increasing domestic demand for U.S. dollars, as well as banks’ restrictions on dollar withdrawal.

The UNDP report noticed that non-performing loans in Afghanistan had increased from around 30 percent at the end of 2020 to 57 percent in September this year.

With the current trend and withdrawal restrictions, approximately 40 percent of the country’s deposit base will be lost by the end of 2021, said the report.

The currency shortage also comes along with rising prices. Some residents and businessmen in Kabul said that the prices of major commodities, such as food and fuel, have almost doubled compared with last year.

A Kabul resident is calling for the U.S. to release the frozen assets to save people’s lives.

“The U.S. blocked the money of Afghanistan, leading to the economic downturn. The poverty rate has reached its peak and people will die, so we urge the U.S. to release money of Afghanistan because [if not,] sure the people will die,” said Mustafa Bahram.

 

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Afghanistan approves five-year power development plan to boost domestic energy production

The strategy includes the implementation of 25 electricity generation projects that will harness Afghanistan’s domestic energy resources, including hydropower, solar, wind and coal.

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Afghanistan has approved a comprehensive five-year national power development plan aimed at expanding domestic electricity generation, strengthening the country’s transmission network and reducing its reliance on imported electricity.

The plan, which was previously endorsed by the Economic Commission chaired by Deputy Prime Minister for Economic Affairs Mullah Abdul Ghani Baradar, has now received final approval from the Supreme Leader.

The strategy includes the implementation of 25 electricity generation projects that will harness Afghanistan’s domestic energy resources, including hydropower, solar, wind and coal. It also outlines the completion of 13 ongoing and 23 new electricity transmission projects, 21 ongoing and 21 planned substation projects, and 34 electricity distribution projects across the country.

Officials said the initiative is expected to significantly expand electricity access, improve the reliability of the national power grid and strengthen Afghanistan’s energy infrastructure while reducing dependence on imported electricity.

The government said the five-year plan forms part of its broader strategy to promote economic development, support reconstruction efforts and enhance financial self-reliance through greater investment in domestic energy resources. Once completed, the projects are expected to contribute to Afghanistan’s long-term energy security and move the country closer to electricity self-sufficiency.

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Afghan, Iranian firms sign three cooperation MoUs at Kabul meeting

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Three cooperation agreements were signed between Iranian and Afghan companies during a business meeting held in Kabul aimed at expanding trade and economic ties between the two countries.

The gathering, hosted by the Embassy of Iran in Kabul, brought together more than 200 Iranian and Afghan business leaders, industrialists, and investors.

According to an embassy statement, Iran’s chargé d’affaires in Kabul, Alireza Bigdeli, highlighted the existing potential for expanding economic and trade cooperation between Iran and Afghanistan.

Following the opening remarks, members of the Iran–Afghanistan Joint Chamber delegation held sector-specific discussions with Afghan business representatives across key industries, including petrochemicals, construction, pharmaceuticals, cement production, laboratory equipment, food processing, battery manufacturing, and technical and engineering services.

 

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Iran-Afghanistan joint chamber of commerce delegation arrives in Kabul to boost trade ties

The delegation will participate in Afghanistan’s National and International Industry and Mines Exhibition and hold business meetings.

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A delegation from the Iran-Afghanistan Joint Chamber of Commerce has arrived in Kabul to take part in an international exhibition, according to the Iranian Embassy in Afghanistan.

In a statement posted on its X account on Thursday, the embassy said the delegation will participate in Afghanistan’s National and International Industry and Mines Exhibition and hold business meetings and conferences with Afghan officials.

The embassy added that the visit aims to expand trade relations between Afghanistan and Iran and strengthen economic cooperation between the two neighboring countries.

The Afghanistan National and International Industry and Mines Exhibition opened in Kabul on Wednesday, June 29, 2026, bringing together domestic and foreign participants to showcase opportunities in industry, mining, and commerce.

Afghanistan and Iran share long-standing economic relations, with trade cooperation continuing despite ongoing regional political and financial challenges.

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