This is the great backward leap for the economy of Afghanistan. It has indeed suffered “a catastrophic collapse” since the arrival of the Taliban at the head of the country, erasing in less than a year what had taken ten years to build, worried the UN in a report published Wednesday. .
Before the Taliban took over in August 2021, Afghanistan’s economy was already very small, with a GDP of around $20 billion, but “in one year it lost around $5 billion”, Kanni said. Wignaraja, Director of the United Nations Development Program (UNDP) for Asia and the Pacific. “That’s about ten years of accumulated wealth and assets lost in just ten months. We have not seen such a dramatic collapse anywhere else in the world”.
The growing share of the informal economy
While the price of a basic food basket has increased by 35% since August 2021, Afghans spend “60-70%, some 80% of their income on food and fuel” and 95-97% of the population now lives under the poverty line. Against just over 70% a year ago.
The report paints a very gloomy picture of the situation in the country, with a collapse of the banking and financial systems, 700.00 jobs lost by mid-2022, the majority by women, and one child in five is at risk of severe malnutrition, in particular in South. The collapse of the economy has also caused an increase in the share of the informal economy, which represents 12 to 18% of GDP, against 9 to 14% a year ago.
For Abdallah Al Dardari, UNDP representative in Afghanistan, the key lies in particular in improving the labor market to get out of this situation. Over the next three years, the UN therefore wishes to “create two million jobs, by promoting a recovery of the private sector, by working with local communities, by focusing on women entrepreneurs, and by renewing local agricultural infrastructure. and microfinance and banking institutions”. Humanitarian aid will indeed not be enough to deal with the situation, while the number of people requiring this aid has increased from 19 million to 22 million in 14 months.