KABUL: South Asia has endured significant adverse spillover from the Russian Federation’s invasion of Ukraine, the World Bank said.
The World Bank in a recent report of 176 pages said that the economic and social situations in Afghanistan remain dire, despite increasing international humanitarian support following the abrupt cessation of aid inflows in August 2021.
“The economy has collapsed, employment and imports—including food and energy—are estimated to have halved, and government spending has likely fallen by three-fourths since August 2021 (World Bank 2022h). Recent surveys show that three-fourths of households report insufficient incomes to meet basic needs,’ the reports reads.
The report also underscored the effects of the ongoing war between Ukraine and Russia.
“Growth is expected to slow from 7.6 percent in 2021 to 6.8 percent in 2022—0.8 percentage points below previous projections. The external environment has worsened markedly, with soaring energy and agricultural prices, slowing global growth, and rising financing costs. While domestic conditions remain solid in many economies, Afghanistan is facing a humanitarian crisis, and Sri Lanka is facing dual balance of payments and sovereign debt crises,” the report reads.
Speaking at a gathering held by the Asia International Development Research and Study Center in Kabul to assess the poverty and education conditions in the country, a senior member of the Islamic Emirate, Anas Haqqani called weak former governments, war, illiteracy, unemployment, climate change and population growth the main causes of poverty.
“Contrary to human respect and justice, the assets of Afghans are frozen. There will not only be fighting poverty but (we) will root out the war economy (legacy of foreign intervention),” he said.
The World Bank report placed Afghanistan at the top of commodity importing countries.
“The prices are high. The price of materials surged two to three times compared to the previous year,” said Masihullah, a shopkeeper.
According to the report, Afghanistan’s GDP dropped from 3.9 percent to -1.9 in 2019.
“It (poverty) has many reasons including the political changes in Afghanistan,” said Seyar Qureshi, an economist.