Connect with us

Business

IMF, Afghanistan reach preliminary agreement over Extended Credit Facility

Ariana News

Published

 on

(Last Updated On: August 15, 2020)

The International Monetary Fund (IMF) and the Afghanistan authorities have reached a preliminary agreement on an economic reform program to be supported by a new three-and-half year US$364 million Extended Credit Facility (ECF).

This announcement comes just three months before the United Nations’ donor pledging conference for Afghanistan gets underway.  

In a statement issued by the IMF on Friday, the fund said the ECF will help mitigate the economic impact of the Covid-19 pandemic, maintain macroeconomic stability, and underpin reforms for economic resilience and good governance.

The fund also stated that continued financial assistance from international partners is critical to support objectives of Afghanistan’s National Peace and Development Framework for 2021-25, including inclusive growth, poverty reduction, and self-reliance.

Leading the IMF’s team was Azim Sadikov, and virtual discussions were held with Afghan officials through July and August on the country’s economic reform program. 

Sadikov said however that the agreement is subject to the approval of the IMF’s Executive Board, which would possibly consider the agreement in October after preliminary conditions have been met by Afghan authorities, including the improvement of accountability and transparency in procurement processes. 

“The new ECF arrangement will support authorities’ reform program to maintain macroeconomic stability and lay the ground for a sustained post-pandemic economic recovery while continuing to advance structural reforms,” Sadikov said. 

He said the reform program aims to gradually reverse the fiscal decline due to the pandemic and instead create space for development sending while increasing self-reliance. 

He stated improvements in customs collections and revenue administration need to be improved and the planned Value Added Tax (VAT) process needs to be implemented in 2022. 

“Monetary policy will continue to focus on maintaining price stability and a flexible exchange rate regime, while fostering confidence in the Afghani,” Sadikov said.

 He also said that reforms, in accordance with the new ECF arrangement, will focus on addressing issues that hamper economic growth and resilience. 

“To that end, the program will aim to improve fiscal governance, strengthen the anti-corruption regime, and bolster the financial sector,” he said. 

“Bolstering the financial sector, including by completing the reform of state-owned banks, will also be important to boost its capacity to contribute to growth.

 “Coming before the November pledging conference, the ECF arrangement is expected to catalyze donor financing, which is critical to support Afghanistan’s reform and development objectives under the multi-year National Peace and Development Framework,” he said. 

 The pledging conference is organized every four years and was last held in 2016 in Brussels. 

This year, Finland will host the conference, which will be organized by both the UN and Afghanistan. 

Previous international financial commitments largely end by December of this year.

Business

India to build Shahtoot dam in Kabul

Ariana News

Published

on

(Last Updated On: November 24, 2020)

India’s External Affairs Minister S. Jaishankar announced on Tuesday at the Geneva Conference 2020 that his country will build a new dam to provide Kabul residents with safe drinking water.

Addressing delegates virtually, Jaishankar said the Shahtoot dam will help supply Kabul residents with water.

“I am happy to announce today an agreement with Afghanistan for building the Shahtoot dam which will provide safe drinking water to two million Kabul residents.

He also said India will launch phase four of a high impact community development program in Afghanistan, which includes around 150 projects worth $80 million dollars.

He stated India has invested heavily in peace and development in Afghanistan but said his country calls for an immediate and comprehensive ceasefire.

“We also believe that the peace process must be Afghan-led, Afghan-owned and Afghan-controlled.”

A feasibility study for the dam was reportedly finalized in 2012 and the estimated cost will be around $236 million.

This dam would also allow for irrigation systems to cover 4,000 hectares of land in the Charasiab and Khairabad districts of Kabul province.

Once complete, officials said the dam will hold 146 million cubic meters of potable water for two million people in Kabul and irrigation water for over 4,000 hectares of land.

India has played a major role in the reconstruction of Afghanistan since the fall of the Taliban regime and has invested over $2 billion in various reconstruction and infrastructure projects.

In 2016, Ghani and Indian Prime Minister inaugurated the Indian-funded “Friendship Dam” in Heart Province, which can also irrigate over 80,000 hectares of land and provide electricity to thousands of homes in the western Afghan province of Herat.

Continue Reading

Business

Uzbekistan to resume direct flights to Afghanistan in January

Ariana News

Published

on

(Last Updated On: November 17, 2020)

A presidential decree announced on Monday that Uzbekistan plans to increase two-way trade with Afghanistan to $2 billion by 2023 and resume direct flights between the two countries starting in 2021.

According to media reports, direct flights will be launched in January between Tashkent and Kabul and Tashkent and Mazar-e-Sharif.

In a presidential decree it was stated that Uzbekistan envisages the acceleration of projects on the extension of existing railway and power transmission lines to Afghanistan, and increasing volume of transit goods by simplifying customs procedures on the borders.

Uzbekistan also plans to reduce the prices of key commodities such as cement, iron, liquefied gas, flour, wheat, eggs and vegetable oil exported to Afghanistan.

Continue Reading

Business

Kabul, Tehran hold 5th round of strategic cooperation talks

Ariana News

Published

on

(Last Updated On: November 17, 2020)

Afghanistan and Iran have held the fifth round of negotiations on the drawing up of a comprehensive document for strategic cooperation between the two countries.

Iranian media reports stated the talks were held in Tehran between an Iranian delegation and an Afghan delegations and were co-chaired by Mirwais Nab, the Afghan deputy foreign minister and his counterpart Seyyed Abbas Araqchi.

On Sunday, Araqchi said he was happy with the progress made in this round of negotiations, and expressed hope that the comprehensive document for Iran-Afghanistan strategic cooperation will soon be prepared to be signed by the presidents of the two countries.

The document outlines a long-term cooperation plan between the two countries in political, security, economic and cultural areas as well as issues related to both countries’ expats and Afghanistan’s refugees, as well as the issue of water.

In a separate meeting prior to the talks, Araqchi and Nab had already highlighted the importance of finalizing the cooperation document as soon as possible.

Continue Reading

Trending