Afghanistan's Economic Resilience Amidst Uncertainty

Afghanistan's economy sees modest growth after severe contraction, driven by private consumption and falling food prices. The World Bank highlights challenges from a widening trade deficit and the importance of supporting domestic businesses and women entrepreneurs. Concerns rise over Taliban's reported restrictions on women's medical education.

Afghanistan's economy is beginning to recover from a period of severe contraction, according to a recent World Bank update. The country's modest GDP growth of 2.7% is attributed to increased private consumption and a decline in food prices, which have helped improve household welfare.

Before the Taliban's return to power in August 2021, Afghanistan relied heavily on foreign aid and grappled with widespread corruption. Their takeover disrupted the economy, freezing billions of international funds and prompting an exodus of skilled Afghans and capital. The World Bank reports that while exports remained stable, a surge in imports has widened the trade deficit, posing a risk to economic stability.

Faris Hadad-Zervos, the World Bank's country director for Afghanistan, emphasized the need for long-term growth by boosting the domestic private sector and enhancing the business environment. However, reports of the Taliban restricting women's medical education raise concerns for women's societal contributions and the overall health of the population, as highlighted by UNICEF's executive director, Catherine Russell.

(With inputs from agencies.)