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Afghanistan’s economy on a cliff, Taliban claims debunked

Afghanistan economy woes, Taliban's claims debunked

In its two years of rule the Taliban has managed to take Afghanistan’s economy on a cliff and the country continues to grapple with severe economic challenges, making it one of the world’s poorest nations with high humanitarian needs. While there have been some signs of stability, numerous Afghan households are still in dire need, and women’s participation in the workforce has significantly declined. As the Afghan economy faces looming financial troubles, experts from the U.S. Institute of Peace (USIP), including Belquis Ahmadi, William Byrd, and Scott Worden, delve into what two new World Bank reports reveal about the country’s economic outlook, the impact of Taliban decrees on women’s participation, and potential measures to address the situation amid diminishing humanitarian aid.

Despite the Taliban’s claims of progress in countering corruption, Afghanistan remains one of the largest recipients of humanitarian aid. World Bank reports, discussed in a recent USIP event, paint a picture of a weak economy unable to generate sufficient jobs and livelihoods, leading to widespread unemployment and poverty. Moreover, looming storm clouds include a projected 50% reduction in international humanitarian aid in 2023, coupled with the Taliban’s opium ban impacting rural households negatively. The influx of Afghans forced to return from Pakistan adds to the financial strain, creating a recipe for increased humanitarian needs in the long term.

Under the Afghan Islamic Republic, measures were implemented to encourage women to join the workforce, resulting in significant progress with thousands employed in various sectors. However, since the Taliban assumed control in 2021, over 140 decrees have been issued, severely restricting women’s rights, particularly in the workforce. The Taliban’s actions, such as blocking women from government roles and replacing women-centric ministries, have led to a drastic reduction in the professional workforce. Despite still being employed in sectors like teaching and healthcare, women face lower wages and diminished opportunities.

The experts emphasize that there are no quick fixes for Afghanistan’s economy. Demographic pressures, coupled with the return of refugees and population growth, outpace economic growth in the short term. To sustain or increase Western donor assistance, the Taliban would need to ease restrictions against female education and employment, a move deemed unlikely. Suggestions include arranging third-party monitoring for anti-money laundering, addressing the banking sector crisis, and unlocking frozen foreign exchange reserves. Furthermore, increasing agricultural production, despite the challenges posed by the opium ban, and fostering regional trade with improved infrastructure are seen as essential steps.

Ultimately, Afghanistan’s long-term economic development requires political and policy choices that the Taliban seems unwilling to make. The exclusion of women and girls from public life is identified as a major impediment to the country’s progress on the development scale. As the nation grapples with economic struggles, finding a delicate balance between immediate humanitarian needs and the imperative for broader reforms remains a formidable challenge.