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Outlook for Afghan economy ‘dire’ as household incomes shrink: World Bank
The outlook for Afghanistan’s economy is dire with per capita income having fallen by over a third in the last four months of 2021 after the Islamic Emirate of Afghanistan (IEA) seized power and foreign forces withdrew, the World Bank said on Wednesday.
“One of the poorest countries in the world has become much poorer,” said Tobias Haque, World Bank Senior Country Economist for Afghanistan.
“The isolation of the Afghan economy following last August’s political crisis risks…leading to grave poverty, displacement, fragility, and extremism threats,” he told a briefing for the release of the World Bank’s first development update on the country since August Reuters reported.
The IEA takeover prompted foreign governments, led by the United States, to cut development and security aid, and the strict enforcement of sanctions has debilitated the country’s banking sector.
The World Bank update said that incomes had dropped so starkly that around 37% of Afghan households did not have enough money to cover food while 33% could afford food but nothing more, Reuters reported.
An IEA failure to meet Western conditions, in particular access to education for all girls, has led the international community to withhold international assistance and keep financial sanctions in place, with exceptions for humanitarian aid.
“Under current conditions, the outlook for Afghanistan’s economy is dire,” the World Bank said in a statement accompanying the update.
If current conditions continued, the World Bank predicted, Afghanistan’s real gross domestic produce (GDP) per capita would decline by around 34% between the end of 2020 and the end of 2022, reversing all progress since 2007.
The United States cancelled planned meetings in March, some of which would have included the World Bank, to discuss key economic issues after the IEA sent all high school-aged girls home after they had arrived ready for classes.
The U-turn angered donors, foreign governments and many Afghans as IEA officials had previously said they were opening all schools.
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More needs to be done to boost local industry, says Kabir
The deputy prime minister for policy, Mawlavi Abdul Kabir, met with Nooruddin Azizi, Acting Minister of Commerce and Industry, at Sapidar Palace on Tuesday and discussed issues around the quality of domestic products and the need to grow and develop the industrial sector.
Azizi said that good trade relations with neighboring countries has resulted in stable prices of goods in the country.
He said the Ministry of Commerce and Industry works closely with the private sector. As a result, the private sector functions in a befitting manner and the Islamic Emirate has provided necessary facilities.
Azizi said that based on the Islamic Emirate’s good economic policies, there has been a significant development in the import/export sector in the country.
Kabir in turn voiced appreciation for efforts by the leadership of the Ministry of Commerce and Industry and said: “The unprecedented efforts of the IEA’s administrations and the stability of the Afghan currency caused the price of food ingredients to remain in the right state and our people also be able to buy essential materials.”
He emphasized the need to work for a balance in trade with neighboring countries, and said more efforts were needed to improve the quality of domestic products and to grow the sector.
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Russia and Tajikistan hold joint military drills along Afghanistan border
Russia and Tajikistan conducted a joint four-day military exercise along the border with Afghanistan in order to be prepared for any “potential threats”, Tajik media reported this week.
Russian military personnel from the 201st military base in Tajikistan participated in this exercise. Reports stated military personnel practiced various combat tactics, especially tactics to counter terrorist groups that illegally enter Tajikistan.
This comes amid repeated concerns expressed by Afghanistan’s neighbors about what they claim are terrorist threats originating from Afghanistan.
The Islamic Emirate has not yet commented on the drills but has repeatedly denied the presence of terrorist groups in the country. The IEA has also continuously said no militant group will be allowed to threaten another country from Afghanistan.
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Media Violation Commission bans two TV channels
The Media Violations Commission has ordered Noor and Barya TV channels to stop broadcasting and to appear in court, state-run Bakhtar News Agency reported on Tuesday.
ّIt is said that the decision against the channels was taken for “not observing the principles of journalism.”
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