Business
EU helps Afghanistan with debt relief amid ongoing pandemic
The EU announced Tuesday it will provide Afghanistan with 2.9 million Euros in grant funding to be used towards debt relief in a bid to help the country maintain its commitment and path towards reaching its Sustainable Development Goals.
The EU said in a statement the ongoing pandemic has carried severe health, social and economic consequences around the world, including in Afghanistan. In many developing countries, debt levels were already high before the crisis and are now at risk of becoming unsustainable.
“Afghanistan has to cope with sharply declining revenue as a consequence of the crisis, driven by restrictions on economic activity and trade. Tax revenue dropped by 40 percent in April–May 2020 while the expenditure burden for health and other social services increased,” the statement read.
“The Afghan government successfully managed to borrow considerable amounts in highly concessional loans from the IMF to cover its fiscal deficit during the crisis. Although Afghanistan’s debt level still remains low, the current revenue position increased vulnerability,” read the statement.
EU Chargé d’ Affaires Arnout Pauwels meanwhile said: “Today’s announcement is good news for Afghanistan, as this additional funding will free space to increase the social, health and economic spending in response to the COVID-19 crisis.
“This comes in addition to the substantial support the EU has already provided to Afghanistan to tackle the pandemic, both bilaterally and through the COVAX facility,” he said.
The support announced Tuesday will also contribute to Afghanistan’s macro-economic stability. This comes at an important moment, as the EU’s assessment of the government’s performance on the 2020 State and Resilience Budget Support begins. For years, economic stability and sound public finance management have been at the heart of the EU’s dialogue with countries receiving EU budget support.
Since the start of the pandemic, the EU has mobilised almost 147 million euros to Afghanistan to address the immediate health crisis and provide humanitarian assistance to the people in need. As the largest donor to the COVAX facility, the EU and its member states have also enabled the delivery of almost 500,000 doses of vaccine to Afghanistan.
Business
Efforts underway to expand Afghanistan’s trade relations with India
A number of investors also suggest that the Islamic Emirate should actively participate in regional and trade fairs to increase exports, so that Afghan products can be marketed in regional and global markets.
The Ministry of Industry and Commerce says that efforts are underway to expand trade relations with India, the volume of which reaches $650 million annually.
Abdulsalam Jawad Akhundzada, a spokesman for the Ministry of Industry and Commerce, says that India is also interested in expanding trade relations with Afghanistan, and Kabul has also taken steps in this regard by using Chabahar Port, and talks have been held with the Indian side on visas.
The Chamber of Commerce and Investment also says that trade relations between Afghanistan and India are expanding and these relations are strengthening with each passing day. According to officials of the chamber, Afghanistan has exported goods worth $500 million to India in the past year.
A number of investors also suggest that the Islamic Emirate should actively participate in regional and trade fairs to increase exports, so that Afghan products can be marketed in regional and global markets.
According to investors, once the visa issues with India are resolved, a large portion of the country’s fresh and dried fruits will be exported to India because India is a good market for Afghan fruits in the region.
Investors want the Islamic Emirate to pave the way for increased exports to India through Chabahar Port.
The Ministry of Mines and Petroleum says it has signed 36 large and small mining contracts, with a total value of $1.3 billion over the past year.
Officials from the ministry stated that these contracts include 10 large mines, 25 small mines, as well as projects related to cement, salt, marble, and a major gas extraction contract with Uzbekistan, all signed with both domestic and foreign companies.
Meanwhile, economic experts have emphasized the importance of increasing investments in the mining sector for the country’s economic growth. They have stressed that priority in mining contracts should be given to domestic companies.
“It is better to prioritize domestic investors over foreign ones,” said Kamaluddin Kakar, an economic expert.
In the meantime, members of the private sector also stated that if both foreign companies and Afghan investors can partner in the mining sector, this will not only foster investment development in the country but also bring positive changes in capacity building within the mining extraction sector.
The press office of the Herat governor has announced the export of Afghanistan’s first shipment via the Khaf-Herat railway to Europe.
According to a statement from the office, the shipment includes 200 tons of dried fruits worth $1.2 million, which were exported to Turkey and Europe through the Khaf-Herat railway in the presence of Islam Jar, the governor of this province, and the Iranian Consul General.
The exported dried fruits in this shipment include pistachios, raisins, almonds, and pine nuts.
The statement added that over the past three months, more than 35,000 tons of goods have been transferred via the Khaf-Herat railway.
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