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World Bank notes modest regional recovery, cites opportunities for Afghanistan’s economy

However, limited international recognition, reduced foreign aid, and continued restrictions on women’s participation in public life continue to constrain broader growth.

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The World Bank’s latest Middle East, North Africa, Afghanistan & Pakistan (MENAAP) Economic Update projects modest growth across the region, with Afghanistan expected to benefit from greater regional trade integration and agricultural recovery, though significant challenges remain.

The report forecasts regional growth at 2.8 percent in 2025 and 3.3 percent in 2026, driven largely by easing oil production cuts in Gulf countries and stronger private investment in non-oil sectors. For Afghanistan, the Bank noted tentative signs of economic stabilization under the Islamic Emirate of Afghanistan (IEA), supported by improved revenue collection, a stable exchange rate, and modest export gains.

However, limited international recognition, reduced foreign aid, and continued restrictions on women’s participation in public life continue to constrain broader growth.

The report — Jobs and Women: Untapped Talent, Unrealized Growth — warns that the region’s economies cannot reach their full potential without fully integrating women into the workforce.

The MENAAP region continues to record the world’s lowest female labor participation rate, with only one in five women employed despite substantial progress in education.

“I urge bold action—not partial measures,” said Ousmane Dione, the World Bank’s Vice President for the Middle East, North Africa, Afghanistan & Pakistan region. “To unlock the full potential of women in the region, we must tackle every barrier to their inclusion with comprehensive measures.”

For Afghanistan, the report emphasizes that empowering women and expanding private sector opportunities – especially in agriculture, trade, and small-scale enterprises – could significantly improve household incomes and long-term resilience.

“Removing barriers that prevent women from accessing jobs could boost GDP per capita by as much as 20 to 30 percent in some economies,” added Roberta Gatti, the region’s chief economist.

While regional outlooks have improved, the World Bank cautioned that ongoing conflicts, displacement, and global trade volatility continue to pose serious risks to recovery – particularly for fragile and aid-dependent economies like Afghanistan.

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Japan vows continued cooperation with Afghanistan’s Health Ministry

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Rising hunger and debt challenge Afghan families amid influx of returnees

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Nearly nine in ten Afghan families are going hungry or sinking deeper into debt, as millions of new returnees stretch scarce resources across poverty-hit provinces in Afghanistan’s east and north, the United Nations Development Programme (UNDP) warned on Wednesday.

Afghanistan, battered by aid cuts, sanctions, and a series of natural disasters, is struggling to absorb the return of more than 4.5 million Afghans since 2023 — including 1.5 million expelled this year from Pakistan and Iran, which have intensified deportations of undocumented migrants.

According to the UNDP’s latest assessment, 90 percent of returnee families are now taking on debt to afford food, healthcare, or rent. Over half of returnee households report skipping medical care to feed their families. Average household debts range between $373 and $900, while the average monthly income hovers around $100, the report said.

The mass returns have compounded Afghanistan’s economic and humanitarian crisis, already among the world’s worst. Housing shortages have worsened sharply, with rents tripling in many areas. More than half of returnees report insufficient living space or bedding, while 18 percent have been displaced twice within the past year. In western districts such as Injil and Guzara, the UNDP found that most returnees were sheltering in tents or crumbling structures.

UNDP Resident Representative Stephen Rodriques called for urgent, “area-based recovery” initiatives that link livelihoods, housing, and services to help communities under strain.

“By linking income opportunities, basic services, housing and social cohesion, it is possible to ease pressure on high-return districts and reduce the risk of secondary displacement,” he said.

International assistance to Afghanistan has plummeted since 2021, and the UN’s $3.1 billion humanitarian appeal for 2025 remains less than half funded. The Islamic Emirate has repeatedly appealed for global support and condemned Pakistan’s mass expulsions, saying it is “deeply concerned” over the treatment of Afghan nationals.

The UNDP report also highlights the worsening exclusion of women from the workforce, warning that restrictions on female employment are undermining family survival and economic recovery.

Only six percent of Afghan women are currently participating in the labor force — one of the lowest rates in the world, the report stated.

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Afghan delegation declines Pakistan’s request for Fatwa on domestic conflicts

Speaking at a press conference on Wednesday Najib explained that the mediators also supported this request, citing their limited awareness of the sensitivities between the two countries.

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Rahmatullah Najib, Deputy Minister of Interior and member of Afghanistan’s negotiation team with Pakistan, revealed that during recent talks, the Pakistani side requested the Islamic Emirate issue a fatwa declaring all ongoing wars in Pakistan as unlawful.

Speaking at a press conference on Wednesday Najib explained that the mediators also supported this request, citing their limited awareness of the sensitivities between the two countries.

He added that while the Afghan delegation agreed in principle that a fatwa could be issued, they emphasized that the decision for the authority to issue such a decree lies solely with Darul Ifta. Any decision from this body would strictly follow Islamic law, not personal or external preferences.

Najib noted that this explanation may not have been acceptable to the Pakistani delegation, and these differences ultimately led to the negotiations concluding without any tangible results.

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