KABUL: Against the backdrop of the Parliament’s passing of the national budget bill for the next year, the World Bank is warning Afghanistan will face tough times in 2020 in terms of economic resilience amid existential threats including the exponential political uncertainty and the dwindling foreign aid.
Political wrangling and peace process already bedeviled by uncertainty have put fundamental impacts on Afghanistan’s economy, according to the World Bank’s report on global economic growth index.
Presidential elections have remained in the doldrums and it is not clear whether peace negotiations between the United States and Taliban will ultimately culminate into reduction of violence in the war-shattered country, the report said.
To the government’s chagrin, some foreign donors are highly likely to reduce the amount of their aid to Afghanistan in considerable scales. This is as foreign aid constitutes 75% of Afghanistan’s public expenditures.
The World Bank’s growth index put Afghanistan economic growth at 2.9% in 2019 which falls in the sphere of agriculture reforms. But poverty has deteriorated compared to the preceding year. The World Bank warned Afghanistan against an upward trend of poverty and sought acceleration of reforms to steer economic growth and curb poverty.
The World Bank economist Tobias Haque said Afghanistan’s economy would grow by 3.3% if droughts are reduced, private sector stimulated and election results announced. He proposed Afghanistan bring fundamental trade reforms and strengthen the fight against corruption as trust-building measures.