Business
UNDP warns Afghan economy to contract by 6% due to COVID-19
United Nations Development Program (UNDP) Afghanistan launched its latest COVID-19 impact assessment report on Wednesday and said the pandemic has set back Afghanistan’s economic growth by several years.
The report, the 4th since the coronavirus outbreak, exposed structural and resource gaps in responding to unforeseen events such as pandemics. The country had to reallocate resources from long-term development priorities to fighting this health crisis.
In a statement issued by the UNDP, the organization said the report, titled “Fiscal Options in Response to Coronavirus Crisis”, focused on the fiscal implications of COVID-19.
The UNDP stated it estimates that due to a combination of external and internal shocks, the Afghan economy will contract by around six percent in 2020.
“Assuming the recovery starts in 2021 and growth performance to be positive between 2021 and 2024, it will be moderate, and well below the pre-pandemic level.
“Without well thought-out recovery-oriented policies, this amounts to a cumulative loss of around 12.5 percent in real GDP by 2024,” read the statement.
UNDP said Afghanistan witnessed a sharp decline in revenues in 2020 due to low economic activity, trade disruption and weaker compliance brought on by the pandemic.
“The government had to adjust the revenue estimates downwards from Afs 209 billion (US$2.71 billion) in 2019 to Afs 144 billion (US$1.87 billion) during the mid-year budget review.”
UNDP stated it estimated an average of 17 percent decline in corporate tax revenue and 18 percent decline in personal income tax revenue.
“Tax on international trade will be the worst hit and revenues may decline to as low as 19 percent due to the decrease in imports, while tax revenue on goods and services might decline by 10 percent,” the statement read.
Meanwhile, UNDP stated the fiscal deficit is expected to increase to around four percent of GDP in 2020.
“The Government of Afghanistan needs to opt for policies and programmes to generate more revenue to address the fiscal deficit.
“Given the economic slowdown, a second wave of the pandemic, continued conflict, and an uncertain peace process and political environment, the country will continue to need grant support from the international community to address the fiscal deficit and maintain its current level of expenditure on basic services,” read the UNDP’s statement.
The organization also stated that additional grants need to be directed at driving and implementing reforms to improve the business regulatory environment, improve governance, encourage investment and strengthen the private sector.
According to the statement, the UNDP and other stated along with other international development partners, it would continue to support Afghanistan in the run up to the donor pledging conference later this month.
However they urged the Afghan government to address the immediate fiscal impact of the pandemic and help reverse its negative effects.
Business
Afghanistan and Uzbekistan agree on export of 100,000 tons of Bamyan potatoes
Cooperation between the Afghanistan Chamber of Commerce and Investment and the Uzbekistan Chamber of Commerce has paved the way for exporting potatoes from Bamyan province to the Uzbek market.
In this regard, Sayed Karim Hashemi, President of the Afghanistan Chamber of Commerce and Investment, and Doran Vahabov, President of the Uzbekistan Chamber of Commerce, have agreed on the export of 100,000 tons of Bamyan potatoes to Uzbekistan. Work is underway to finalize the export agreement.
Meanwhile, the first shipment of potatoes, consisting of eight trucks, has departed for the Uzbek city of Termez through the Hairatan Port.
The chambers of commerce of both countries, in cooperation with local authorities in Bamyan, have facilitated connections between traders and farmers and coordinated the purchasing, marketing, and transportation of the produce. This initiative is expected to expand market opportunities for Bamyan farmers and strengthen trade between Afghanistan and Uzbekistan.
Business
Afghan deputy commerce minister travels to India for trade fair in Delhi
Afghanistan’s Deputy Minister of Industry and Commerce, Ahmadullah Zahid, has travelled to India to attend the India International Trade Fair (IITF) 2026 in New Delhi.
The ministry said Zahid is scheduled to meet senior Indian government officials, trade representatives and investors during the visit.
Discussions are expected to focus on expanding bilateral trade and economic relations, increasing trade between the two countries, exploring new markets for Afghan products and identifying opportunities for joint investment.
The ministry said the visit aims to strengthen trade cooperation, promote Afghanistan’s production and export potential, and create new opportunities for economic engagement between Kabul and New Delhi.
The 45th India International Trade Fair (IITF) 2026 takes place from November 13 to November 27 in New Delhi.
Business
Afghanistan hosts dialogue on Islamic microfinance to expand access to Sharia-compliant financial services
Participants also explored practical solutions and future steps to strengthen the sector, emphasizing the importance of cooperation, knowledge-sharing and better coordination among relevant institutions.
A dialogue on Islamic microfinance was held in Kabul on Wednesday, bringing together representatives of financial institutions, government authorities, international partners and Afghanistan’s microfinance sector to discuss ways of expanding inclusive financial services in the country.
The event was organized by The Liaison Office in coordination with the Afghanistan Microfinance Association (AMA), Da Afghanistan Bank (DAB) and the Indonesian Embassy in Kabul.
Participants discussed opportunities and challenges facing the development of Islamic microfinance services, with a focus on expanding access to financial products that comply with Islamic Sharia principles.
Representatives of AMA, Da Afghanistan Bank and the Indonesian Ambassador to Afghanistan delivered keynote remarks, highlighting the current situation of the microfinance sector, international experiences and opportunities for developing diverse Islamic financial products.
Two panel discussions focused on major challenges facing microfinance institutions, including structural barriers to growth, limited access to capital, funding and liquidity constraints, difficulties in securing guarantees, and the long-term sustainability of Islamic microfinance services.
Participants also explored practical solutions and future steps to strengthen the sector, emphasizing the importance of cooperation, knowledge-sharing and better coordination among relevant institutions.
The dialogue concluded with calls for stronger collaboration among financial institutions and development partners to improve access to inclusive, sustainable and Sharia-compliant financial services across Afghanistan.
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