Business
Afghanistan’s economy is ‘normal’, says finance ministry
Afghanistan’s Ministry of Finance said Wednesday that after a comprehensive assessment of various sectors, the country’s economic situation is in “its normal state”.
According to a statement issued by the ministry, a meeting was convened to assess financial trade, foreign humanitarian aid, the value of the afghani (AFN), and the impact of changes in foreign policies on the economy.
It was found that the import and export process is functioning smoothly, the banking sector remains stable, national revenues are being collected transparently, and essential government expenditures are being made regularly without any delays.
The ministry attributed the decrease in the value of the AFN against foreign currencies, particularly the US dollar, to widespread negative propaganda.
“Overall, all domestic economic factors are maintaining the value of the Afghan currency in a normal state,” the statement read.
Modest recovery
The Afghan economy is showing signs of moderate growth, but still faces significant headwinds, including fiscal constraints, trade imbalances, and a limited capacity for public investment, according to the World Bank’s latest Afghanistan Development Update.
The World Bank stated that Afghanistan has seen a modest GDP growth of 2.7% over the past two years – growth driven by private consumption. The update stated the economy had recouped only about 10% of past economic losses, indicative of the slow and fragile nature of the recovery.
“Afghanistan’s long-term growth prospects depend on tapping into the substantial potential of the domestic private sector and improving the overall business environment,” said Faris Hadad-Zervos, World Bank Country Director for Afghanistan in the update, which was issued last month.
“Key to this is increased investment, providing access to finance to small businesses, and supporting educated and skilled women entrepreneurs so their businesses can thrive. Without this, the country risks prolonged stagnation with limited prospects for sustainable development,” he added.
The World Bank also stated that the partial recovery, coupled with falling food prices, has contributed to a gradual improvement in household welfare.
But most Afghan households continue to struggle to meet basic needs and poverty remains widespread, the report read.
Pakistan’s kinno exports remain far below potential as regional tensions, high freight costs and weak government support continue to choke the citrus trade.
Despite being a leading global citrus producer, Pakistan is expected to export just 400,000–450,000 tonnes of kinno in the 2025–26 season, compared with an estimated capacity of 700,000–800,000 tonnes.
Exports in 2024–25 stood at around 350,000–400,000 tonnes, mainly to Russia, the UAE, Saudi Arabia, Afghanistan, Indonesia and Central Asia. While better fruit quality this season has raised hopes, persistent crossing disruptions—especially with Afghanistan—and transport bottlenecks have offset gains.
Growers say prices have collapsed sharply, forcing panic sales. Rates for large kinno have fallen from over Rs120 per kg early in the season to as low as Rs75, while smaller fruit is selling for Rs35–40 per kg amid weak demand.
Industry leaders warn the crisis is crippling processing units and jobs. More than 100 factories reportedly failed to open this season, with dozens more shutting down as exports stall. Cold storages in Sargodha are nearly full, putting fruit worth millions of dollars at risk of spoilage, while growers fear losses of up to Rs10 billion.
Exporters are urging the government to urgently resolve issues, subsidise logistics, and help access alternative markets, warning that prolonged inaction could devastate farmers, workers and the wider economy.
Iranian President Masoud Pezeshkian has said that Tehran will facilitate trade and economic exchanges with Afghanistan, including easing procedures at customs and local marketplaces.
He made the remarks during a televised interview following his visit to South Khorasan province, which shares a border with Afghanistan.
Pezeshkian, in a separate event addressing local business leaders, highlighted the province’s strategic advantages, citing its rich mineral resources, proximity to neighboring countries such as Afghanistan and Pakistan, and access to the ocean via the Chabahar port. He described the region as “a golden opportunity not found everywhere,” emphasizing its potential for economic growth and cross-border commerce.
A Kazakh delegation led by the Deputy Minister of Finance of Kazakhstan met with Sediqullah Khalid, First Deputy Governor of Da Afghanistan Bank, to discuss ways of strengthening banking and economic cooperation between the two countries.
According to a statement issued by Da Afghanistan Bank, Khalid said the central bank is keen to establish regular and effective banking relations with Kazakhstan as part of broader efforts to expand bilateral trade.
He noted that enhanced banking cooperation would help facilitate trade, investment, and wider economic interaction between Afghanistan and Kazakhstan, while also contributing to financial stability at the regional level.
Members of the Kazakh delegation also emphasized the importance of developing banking and economic ties and expressed their readiness to expand joint cooperation.
The two sides further agreed to establish technical committees from both countries to hold expert-level discussions and advance practical steps for cooperation.
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