Editor in Chief: Moh. Reza Huwaida Sunday, September 23rd, 2018

Afghanistan to Face Serious Economic crisis

As we are moving ahead in Afghanistan, things seem to be getting worse than going towards betterment. This summer the process of transition of security responsibilities in Afghanistan begin with seven areas handed to Afghan security forces. That was the first phase. Very soon, according to reports President Hamid Karzi will announce the second phase of transition in which 17 regions will fall in the hands of Afghan national army and police. This comes at times, when security has worsened in the already transitioned areas, Lashkargah for example. So, definitely there is concern among Afghans.

The concern is that with withdrawal of NATO force from a major number of Afghan provinces and cities – that are deemed peaceful, security will further go deteriorated as Taliban are, seemingly, concentrated to bolster their activities in the provinces where transition takes place.

Whether, the transition is a successful process or not it is quite early to judge. However, the Afghan economy is really going to suffer negative changes as a result of international withdrawal. What will be the fate of security and economy of Afghanistan after the withdrawal of international community is still quite vague. Security – as experience in Afghanistan in the last ten years shows – will definitely deteriorate.

At the same time one can not be optimistic about economic stability of Afghanistan after the international community withdraws. Currently the Afghan economy is greatly (91 percent according World Bank) dependent on the foreign aids. In the last 10 years, the US alone has provided about dollars 19 billion civil aids to Afghanistan.

Other US allies have also contributed significantly by consistently providing financial supports to Karzai administration. But these funds, according to experts, will not remain so and are to shrink as the international community continues reducing its role and engagement in Afghanistan both on civil and military fronts.

The Western allies of Afghanistan including US and UK do not know the exact economic packages they would have for Afghanistan after the year 2014. It is generally assumed that with troops going out, the foreign economic assistance would also dry up to a great extent pushing Afghanistan into a harsh economic condition.

The post-2014 economic situation should be taken into consideration as serious as that of security. However, the current national and international focus seems to be on bringing somehow betterment in security condition that has deteriorated greatly in the recent years. In June, a US congressional study warned that Afghanistan could be left in the midst of a "severe economic depression" after the 2014 pullout.

The same study found that roughly 80 percent of the US Agency for International Development's (USAID) funds are spent in troubled Southern and Eastern Afghanistan, but that most of those funds have been poorly spent on short-term stabilization projects instead of longer term development initiatives designed to promote growth.

The last decade, according to experts, was a golden opportunity for Afghanistan to strengthen its economy and other national infra structures. If that opportunity had been properly utilized today we would not ask the question: Is Afghanistan economically ready for taking key responsibilities as the international community is diminishing its role?

Unfortunately, the government of Afghanistan has completely failed to make proper uses of the heaps of money that have poured into Afghanistan and it still has no obvious economic strategy. This increases the chances of economic down fall in Afghanistan after international community withdraws. Karzai administration has started consultation with economic experts in this regards but according to many, now it is too late.