Business

SIGAR issues pessimistic economic forecast for Afghanistan

Published

5 years ago

February 20, 2022

Afghanistan’s economy suffered severe contraction in 2021, with the UN Development Programme (UNDP) and IMF estimating up to a 20–30 percent drop, the US Special Inspector General for Afghanistan Reconstruction (SIGAR) reported.

According to SIGAR’s latest report, annual per capita income is estimated to have fallen from $650 in 2012, to $500 in 2020, and is expected to drop to $350 by 2022.

SIGAR stated that male unemployment in Afghanistan may nearly double from 15.2 percent in 2019 to 29 percent by 2022.

“In the worst-case scenario modeled by the Asian Development Bank, unemployment could increase by more than 40 percent in the short run and household consumption could contract by 44 percent,” read the report.

The devaluation of the afghani has also impacted the Afghan economy and further diminished Afghan households’ ability to purchase food and
other necessary items, because much foreign trade was settled in US dollars.

Since August last year, the afghani has depreciated against the US dollar, from approximately 77 afghani to the dollar to around 105 as of January
2, 2022.

SIGAR also reported that adding to the pressure on the country’s limited cash reserves, Afghanistan lacks the technical capabilities to print its own currency.
According to SIGAR, the IEA has not yet secured or developed a domestic printing source for afghani banknotes.

SIGAR reported that Afghanistan’s largely cash-based economy has continued to struggle with an acute cash shortage since November, which has limited day-to-day economic activities.

“Banks are at the center of a liquidity crisis, with lost access to international financing and depositors attempting to recover their funds,” read the report.

According to a UNDP report, Afghanistan’s banking system is in “existential crisis.” Total deposits had fallen to the equivalent of $2 billion as of
September 2021 from $2.8 billion the month.

As the Afghan economy has struggled to find areas of sustainable economic growth in recent years, the country has increasingly relied on remittances from Afghans working abroad, especially in neighboring Iran.

By 2019, remittances accounted for the equivalent of 4.3 percent of Afghanistan’s annual GDP, an increase from 1.2 percent in 2014, according to World Bank data.

However, officials from the UN’s International Organization for Migration estimate this figure could have been as high as 15–20 percent, given that many remittances are sent through the informal hawala money-transfer system.

According to officials at Médecins Sans Frontières, with the absence of a functioning banking sector, many NGOs have also been forced to rely on
hawalas to pay expenses within Afghanistan.

In November 2021, the IEA announced a complete ban on the use of foreign currency in Afghanistan, interfering with remittance activities and
worsening the country’s liquidity crisis.

However, SIGAR reported that indicators suggest that the currency ban is not being actively enforced against the US dollar, which continues to be widely used in Afghan markets.

Related Topics:#Income featured peace SIGAR

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Afghanistan and Uzbekistan sign 20 trade MoUs worth $267 million

Published

4 days ago

August 30, 2026

Ariana News

Afghanistan’s Ministry of Industry and Commerce says 20 trade memorandums of understanding (MoUs) worth $267 million have been signed following business meetings between Afghan traders and private-sector representatives and officials from Uzbekistan’s Kashkadarya province.

The agreements were signed on the sidelines of a business networking conference between Afghan private-sector representatives and Kashkadarya in Kabul. Officials from Afghanistan’s Ministry of Industry and Commerce, representatives of Kashkadarya province, Uzbekistan’s ambassador to Kabul, and private-sector representatives from both countries attended the conference.

Ahmadullah Zahid, Deputy Minister of Industry and Commerce, said economic relations and trade between Afghanistan and Uzbekistan have increased following visits by delegations from both sides.

He stressed the need to simplify trade and transit procedures and remove existing obstacles. He also said Afghanistan is ready to discuss the transit of its export goods through Uzbekistan.

Shahret Muradov, Deputy Governor of Kashkadarya, said the province is ready to expand trade and industrial cooperation with Afghanistan and host Afghan delegations and traders.

The agreements cover sectors including food products, clothing, construction, livestock, electronic equipment, and furniture.

Business

Afghanistan transports more than 704,000 tonnes of goods by rail in August

The Hairatan railway route handled the largest share, with 464,767 tonnes, followed by Khaf–Herat with 137,687 tonnes, Torghundi with 62,015 tonnes, and Aqina with 39,831 tonnes.

Published

5 days ago

August 29, 2026

Ariana News

Afghanistan transported more than 704,000 metric tonnes of goods through its railway network in August 2026, the Ministry of Public Works said.

The ministry said 704,300 metric tonnes of petroleum products, non-petroleum goods and other materials were imported and exported through four major railway routes during the month.

The Hairatan railway route handled the largest share, with 464,767 tonnes, followed by Khaf–Herat with 137,687 tonnes, Torghundi with 62,015 tonnes, and Aqina with 39,831 tonnes.

The ministry said the railway network also supported Afghan exports during the month, including 3,751 tonnes of carbonated beverages shipped abroad.

According to the ministry, expanding rail transportation and exports could contribute to job creation, higher national revenues and greater economic stability and self-sufficiency.

The ministry added that the Islamic Emirate is working to improve trade conditions and expand transportation facilities for Afghan traders.

Business

TAPI pipeline nears first gas sales in Afghanistan

Herat Governor Mawlavi Islam Jar recently said construction of the TAPI pipeline in the province is expected to be completed within two months.

Published

5 days ago

August 28, 2026

Ariana News

The Turkmenistan-Afghanistan-Pakistan-India (TAPI) gas pipeline is moving closer to its first commercial gas sales in Afghanistan after years of delays, with Herat expected to become the first Afghan market served by the project.

According to the Times of Central Asia, Turkmenistan plans to supply gas to Herat through the TAPI pipeline, while the timeline for extending the project to Pakistan and India remains uncertain.

The report says Turkmengaz and Afghan Gas signed a memorandum on August 10 covering the purchase of gas through TAPI. However, the agreement does not yet specify the price, supply volume or exact date for the start of commercial deliveries.

Afghan and Turkmen officials are also working to develop a gas distribution network in Herat to supply industrial facilities, power plants and households.

Meanwhile, Herat Governor Mawlavi Islam Jar recently said construction of the TAPI pipeline in the province is expected to be completed within two months.

According to the governor, Turkmen officials have completed their work on the project and will hand it over to Herat authorities once the remaining process is finalized.

Jar has also urged residents and factory owners in Herat’s industrial park to make the necessary preparations for the start of gas distribution and pipeline connections.

The TAPI project is designed to transport Turkmenistan’s natural gas through Afghanistan and Pakistan to India, with a planned annual capacity of 33 billion cubic meters.