Business
World Bank survey finds Afghan firms still face ‘daunting challenges’
The World Bank said Monday many businesses in Afghanistan are adjusting to the new business environment but most still face daunting challenges.
The World Bank’s second private sector survey, published Monday, was conducted in May and June 2022.
The Private Sector Rapid Survey (PSRS) Round 2 assessed the status, constraints, and investment outlook of businesses, and the impacts of the ongoing economic challenges faced by private sector firms in Afghanistan.
“Afghanistan continues to face enormous social and economic challenges that are impacting heavily on the welfare of its people, especially women, girls, and minorities.
“The new survey confirms the resilience of Afghanistan’s private sector, which can play a key role in the economic recovery of the country and improving the lives of all Afghans,” said Melinda Good, World Bank Country Director for Afghanistan.
“It also shows that firms continue to suffer from impacts of political uncertainty and policy fragmentation, Afghanistan’s isolation from the international financial sector, and reductions in international assistance,” she said.
More than three-fourths of firms surveyed in Round 2 are operational, compared to two-thirds in Round 1, conducted in October and November last year.
However, most are operating significantly below their full capacity and are only considered partially open, the World Bank stated. Consumer demand appears to have slightly improved in past months but remains considerably lower than before August 2021.
Employment remained around 50 percent lower, on average, than before August 2021, compared to 61 percent lower in Round 1 of the survey.
Women-owned businesses are most affected by restrictions on women’s mobility, resulting in disproportionate revenue and job losses, World Bank stated.
Female employment remains 62 percent lower than before August 2021, while it was 75 percent lower in November 2021.
In addition to this, the World Bank found that businesses continue to be negatively impacted by the loss of international banking relationships, which has disrupted international payments and limited access to bank accounts and formal banking.
“Firms are resorting to the use of informal money transfer systems for domestic payments,” the bank stated.
Despite some businesses hiring employees, the majority of respondents have coped with these challenges by laying off employees, shifting to cash and informal payment channels, shrinking investments, and lowering staff salaries, World Bank reported.
“Action is required by the authorities to unlock possibilities for much-needed international economic integration and domestic opportunities for Afghanistan’s private sector,” said Good.
“This includes increased transparency in public finances and reestablishing central bank independence. With measures like these and continued resilience of businesses, a sustainable private sector-led recovery is possible.”
Business
Over 1,500 emerald mines discovered in Panjshir: Local officials
Local officials in Panjshir have announced the discovery of over 1,600 emerald mines in the province, with extraction currently underway at 600 sites.
Over the past year, the extraction of emeralds from 600 mines in Panjshir has yielded 100,000 carats, valued at approximately $6.9 million.
Panjshir Governor Mohammad Agha Hakim expressed optimism that the development of the mining sector will provide significant job opportunities, particularly for the province’s youth.
Economic experts believe that increased investment in large-scale mining could create tens of thousands of direct and indirect jobs, helping to reduce unemployment.
Meanwhile, Panjshir residents are calling on the Islamic Emirate to expand mining contracts in the province, highlighting the area's wealth in emeralds, iron, lead, zinc, and gold.
Business
IEA has provided facilities for industrialists and investors: Baradar
Deputy Prime Minister for Economic Affairs Mullah Abdul Ghani Baradar says the Islamic Emirate has provided land, privileges, and facilities for industrialists and returning investors in industrial zones.
Speaking at a conference in Kabul on Thursday titled “Calls for Investment in Afghanistan”, Baradar said that the law for industrial zones had been signed with an introduction, six chapters, 11 sections, and 67 articles.
"I urge industrialists and investors to transfer their industries and investments to the country so that they can fulfill their responsibility in the development of the country's industry,” said Baradar.
He stated that the IEA has increased customs duties on imported items that are produced domestically and meet the needs of the people, in order to support local production.
Baradar added that all government departments have been instructed to prioritize domestic products in their purchases.
Meanwhile, the acting Minister of Industry and Commerce Nooruddin Azizi also announced at the conference that 160,000 hectares of land has been allocated to industrialists, and 1,200 investors have invested $500 million in various sectors.
Azizi said: “We have around 1,200 companies requesting land, and approximately $500 million is being invested by them in Afghanistan."
According to him, returning industrialists and traders are exempt from customs duties on machinery and equipment imports, and at their request, two-year visas will be issued for their foreign technical workers and engineers.
The acting Minister of Economy Din Mohammad Hanif also said: “If Afghan investors residing abroad bring half of their investment back to the country, Afghanistan will become self-sufficient."
Business
UNAMA officials meet with minister of economy, over Afghanistan aid
Afghanistan’s minister of economy said at the meeting that this year, international organizations should focus more on the implementation of development projects
The head of the United Nations Assistance Mission in Afghanistan (UNAMA), along with her deputy, met this week with the acting minister of economy, Din Mohammad Hanif, for discussions around aid.
According to the ministry, the meeting between Hanif and Roza Otunbayeva and Indrika Ratwatte focused on "the effective and transparent adaptation of humanitarian aid in accordance with the economic needs and development priorities of the people".
Hanif stressed in this meeting that in the coming year, international organizations should focus more on the implementation of development projects and activities in the country in order to solve livelihood problems and reduce the level of poverty and unemployment.
The UN’s World Food Program meanwhile said in its latest report that in December the agency reached 5.9 million vulnerable people with 43,396 metric tons of food and US$18.7 million cash under its general food assistance program.
The agency also said that WFP Afghanistan is only 10 percent funded for the January to June 2025 six-month period, with a net funding requirement of US$652 million.
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