Business

Afghanistan’s growth prospects remain uncertain amid global uncertainty: World Bank report

According to the report, in Afghanistan, despite aid cuts, the economy is estimated to have grown by 2.5 percent in FY24-25, which was slower than the pace of population growth.

Published

2 years ago

April 23, 2025

Ariana News

Amid increasing uncertainty in the global economy, South Asia’s growth prospects have weakened, with projections downgraded in most countries in the region, including Afghanistan.

Stepping up domestic revenue mobilization could help the region strengthen fragile fiscal positions and increase resilience against future shocks, said the World Bank in its twice-yearly regional outlook – the South Asia Development Update – which was released on Wednesday.

According to the report, in Afghanistan, despite aid cuts, the economy is estimated to have grown by 2.5 percent in FY24-25, which was slower than the pace of population growth.

Growth is forecast to increase only moderately to 2.2 percent in 2025/26, the World Bank report stated.

Coinciding with the release of the South Asia report was the World Bank’s Afghanistan Development Update report which explained the situation in more detail.

Stating that while the country’s economy is gradually recovering, the outlook remains uncertain due to growing fiscal pressures, a widening trade deficit and persistent poverty and food insecurity.

The report stated that these factors continue to strain households and hinder inclusive growth.

However, Afghanistan recorded its second consecutive year of growth in 2024, the World Bank stated, adding that the recovery was largely driven by the agriculture sector.

Manufacturing and services remained subdued due to an unfavorable business environment, persistent export barriers and declining foreign aid.

Modest gains in private consumption and real estate investment contributed to growth, the report stated, adding that rising imports widened the trade deficit, increasing external vulnerabilities.

At the same time, rapid population growth and the return of refugees continue to strain job creation and public service delivery, further deepening the fragility of the economy.

Deflation meanwhile persisted in 2024, with food prices having declined sharply. Non-food inflation remained stable. Persistent deflation continued in 2024,

Poverty, food insecurity, and malnutrition however remained pressing challenges and despite modest wage growth, high unemployment and restrictions on women continue to strain livelihoods, the report stated.

Early this year, 14.8 million people faced food shortages, while acute malnutrition – now affecting 4.7 million women and children – is worsening. The World Bank warned that without urgent action, human capital development will be further undermined.

Fiscal pressures meanwhile remained high as domestic revenue mobilization, though relatively strong, is insufficient to offset the sharp decline in aid.

The report also stated that exports declined in 2024, while imports surged – widening the trade deficit.

The increase in imports however was driven by rising industrial demand and substitution of domestic consumer goods.

The afghani (AFN) currency, which had appreciated significantly in 2023 due to strong foreign inflows stabilized with slight depreciation in 2024 but the banking sector remained fragile.

The World Bank reported that economic growth is expected to slow to 2.2 percent in 2025 amid aid disruptions, before gradually recovering to 2.5 percent in 2026–27.

The organization however warned that while Afghanistan’s youth remain a vital source of resilience and untapped potential, urgent action to expand job opportunities for them is needed.

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Business

Afghanistan and Uzbekistan agree on export of 100,000 tons of Bamyan potatoes

Published

2 days ago

November 13, 2026

Ariana News

Cooperation between the Afghanistan Chamber of Commerce and Investment and the Uzbekistan Chamber of Commerce has paved the way for exporting potatoes from Bamyan province to the Uzbek market.

In this regard, Sayed Karim Hashemi, President of the Afghanistan Chamber of Commerce and Investment, and Doran Vahabov, President of the Uzbekistan Chamber of Commerce, have agreed on the export of 100,000 tons of Bamyan potatoes to Uzbekistan. Work is underway to finalize the export agreement.

Meanwhile, the first shipment of potatoes, consisting of eight trucks, has departed for the Uzbek city of Termez through the Hairatan Port.

The chambers of commerce of both countries, in cooperation with local authorities in Bamyan, have facilitated connections between traders and farmers and coordinated the purchasing, marketing, and transportation of the produce. This initiative is expected to expand market opportunities for Bamyan farmers and strengthen trade between Afghanistan and Uzbekistan.

Business

Afghan deputy commerce minister travels to India for trade fair in Delhi

Published

3 days ago

November 12, 2026

Ariana News

Afghanistan’s Deputy Minister of Industry and Commerce, Ahmadullah Zahid, has travelled to India to attend the India International Trade Fair (IITF) 2026 in New Delhi.

The ministry said Zahid is scheduled to meet senior Indian government officials, trade representatives and investors during the visit.

Discussions are expected to focus on expanding bilateral trade and economic relations, increasing trade between the two countries, exploring new markets for Afghan products and identifying opportunities for joint investment.

The ministry said the visit aims to strengthen trade cooperation, promote Afghanistan’s production and export potential, and create new opportunities for economic engagement between Kabul and New Delhi.

The 45th India International Trade Fair (IITF) 2026 takes place from November 13 to November 27 in New Delhi.

Business

Afghanistan hosts dialogue on Islamic microfinance to expand access to Sharia-compliant financial services

Participants also explored practical solutions and future steps to strengthen the sector, emphasizing the importance of cooperation, knowledge-sharing and better coordination among relevant institutions.

Published

3 days ago

November 12, 2026

Ariana News

A dialogue on Islamic microfinance was held in Kabul on Wednesday, bringing together representatives of financial institutions, government authorities, international partners and Afghanistan’s microfinance sector to discuss ways of expanding inclusive financial services in the country.

The event was organized by The Liaison Office in coordination with the Afghanistan Microfinance Association (AMA), Da Afghanistan Bank (DAB) and the Indonesian Embassy in Kabul.

Participants discussed opportunities and challenges facing the development of Islamic microfinance services, with a focus on expanding access to financial products that comply with Islamic Sharia principles.

Representatives of AMA, Da Afghanistan Bank and the Indonesian Ambassador to Afghanistan delivered keynote remarks, highlighting the current situation of the microfinance sector, international experiences and opportunities for developing diverse Islamic financial products.

Two panel discussions focused on major challenges facing microfinance institutions, including structural barriers to growth, limited access to capital, funding and liquidity constraints, difficulties in securing guarantees, and the long-term sustainability of Islamic microfinance services.

The dialogue concluded with calls for stronger collaboration among financial institutions and development partners to improve access to inclusive, sustainable and Sharia-compliant financial services across Afghanistan.