News / Asia

    Next Afghan President to Tackle Ailing Economy

    Supporters of Afghan presidential candidate Abdullah Abdullah attend a campaign rally in the Paghman district of Kabul, Afghanistan, June 9, 2014.
    Supporters of Afghan presidential candidate Abdullah Abdullah attend a campaign rally in the Paghman district of Kabul, Afghanistan, June 9, 2014.
    Spozhmai Maiwandi
    More than three decades of continued conflict in Afghanistan has taken a toll politically, socially and psychologically.

    But the greatest damage may have been inflicted on the country’s economy.

    By 2001, agricultural production had been disrupted, local manufacturing had come to a halt, and basic infrastructure was destroyed largely because of the Taliban government. Since 2001 and the U.S.-led invasion, the advances made in the local economy have been largely dependent on foreign aid.

    During this year’s presidential campaign, voters consistently raised concerns about their economic future.

    What will happen to Afghanistan once foreign aid and investment levels off when the U.S. pulls out after 2014?

    Landlocked and without access to any ports, Afghanistan has traditionally been an agrarian economy.

    In the 1950s and 1960s, the country not only produced enough food for its own citizens but had a surplus, which was exported to neighboring countries and beyond. The chief export commodities were wheat and fresh/dried fruits. There was also an industrial sector, based on agriculture and pastoral raw materials. Goods produced included olive oil, carpets, and Karakul, a fine sheep’s wool native to Central Asia.  

    Afghanistan is rich in mineral and precious stones deposits-resources such as copper, gold, and iron ore and gemstones including emeralds, rubies, and lapis lazuli.

    Northern Afghanistan has untapped natural gas and oil resources. Because of its strategic location between Central Asia to the north and the ports of Pakistan to the south, various projects are currently underway to develop natural gas and oil pipelines through the country.

    Economic growth

    According to the World Bank, Afghanistan’s economy has grown exponentially since the fall of the Taliban regime, from $2.462 billion in 2001 when the Taliban was ousted to $20.5 billion in 2012. That growth was due largely to the flow of international development monies.

    The U.S. alone has spent more than $100 billion in non-military funds for reconstruction efforts.

    The return of millions of Afghan refugees - many without homes and jobs - from Pakistan and Iran have further strained the already precarious economy. The population of the major cities has ballooned with returning refugees and people from the provinces looking for work.

    Kabul alone has grown from a city of an estimated 500,000 in 2001 to nearly 3.3 million in 2012 inhabitants to more than 4 million.  Even in the capital city, the majority of Afghans still lack clean water, electricity, medical care, and jobs.

    The situation is considerably worse in the provinces.  Afghanistan's living standards are among the lowest in the world, with an estimated per capita GDP of $1,100 in 2012.

    Nine donors’ conferences between 2003 and 2010 raised more than $67 billion in military and civilian aid for Afghanistan reconstruction. An additional $16 billion in civilian aid was pledged by donors at the Tokyo conference in 2012.

    Corruption

    However, Afghanistan’s ability to absorb and spend such large amounts of money along with lax oversight has “created ample opportunities for corruption,” according to a U.S. military study in February.

    In his latest report, the U.S. Special Inspector General for Afghanistan Reconstruction says corruption -- and insufficient oversight by the United States of its massive spending -- has led to “schools built so badly they are in danger of collapsing, clinics with no doctors or medical supplies, police and army barracks that are not fit to use, and roads that are disintegrating for lack of maintenance.”  
     
    Afghanistan cannot survive, let alone prosper, on international aid monies. Not only is foreign aid likely to decrease as time goes on but also the industries that it has supported are not sustainable in the long term.

    Whichever presidential candidate wins in the second round of national elections will have to face growing economic challenges.

    Abdullah's plan

    As former Foreign Minister Abdullah Abdullah and former World Bank official Ashraf Ghani head toward Saturday’s presidential runoff, the candidates are faced with growing questions of how they plan to improve Afghanistan’s economy amid the challenges of low revenue collection, anemic job creation, high levels of corruption, weak government capacity, and poor public infrastructure. 
     
    Abdullah Abdullah
     
    • Received 45 percent of vote in first round of presidential election
    • Served as Hamid Karzai's foreign minister
    • Ran for president in 2009
    • Was an eye doctor
    • Father is Pashtun, mother is Tajik

    Ashraf Ghani
     
    • Received 32 percent of vote in first round of presidential election
    • Served as Hamid Karzai's finance minister
    • Ran for president in 2009
    • Former World Bank official and professor at Johns Hopkins University
    • Pashtun

    In February 2014, during one debate, Abdullah, the presidential front-runner, said he would support large developmental projects for the construction of infrastructure as a means to boost the economy and to create jobs.

    Without citing specifics, he added that the Ministry of Labor would be tasked with reducing unemployment. He also said his administration would have no tolerance for corruption. Abdullah has released a formal economic plan that includes expansion of industrial townships in provinces, foreign investment attraction, and the process of changing the country from a consumption economy to a production economy.

    While discussing the issue of national economic development, Abdullah said that his government will focus on issues such as the establishment of a railway to connect southern and northern regions of the country, rehabilitation of basic infrastructure, development of the livestock sector, and promotion of self-reliance in the agriculture sector.

    “Our economic policy is to change the country from a consumption economy to a production economy," Abdullah said. "This includes agricultural growth, mines extractions, construction, and other sectors that have the potential to boost the nation's incomes."

    Ghani's plan

    Ghani, who served as finance minister under President Hamid Karzai and worked as an economist in the World Bank, does not think that large developmental projects would be a major source of job creation.

    In a presidential debate, Ghani proposed convening multiple commissions to study the issue of unemployment. Although he did agree that the construction of infrastructure would bring some unemployment relief, he added that given the primarily agricultural base of the Afghan economy, other measures, like strengthening the private sector, were important.

    Ghani said the country would have to make major strides toward industrialization in order to become economically self-sufficient. He encouraged foreign donors to assist the country for a few years in this effort, and he cited India and China as two regional powers who already have shown interest in investing in the nation's future.

    Running a successful campaign is a different matter than leading a country, and it is unclear whether and how either candidate’s campaign promises will translate into national policy.

    And yet, after so many decades of violent transfers of governmental power, even this is a welcome problem.

    You May Like

    Russian-speaking Muslim Exiles Fear Possible Russia-Turkey Thaw

    Exiled from Russia as Islamic radicals and extremists, thousands found asylum in Turkey

    US Presidential Election Ends at Conventions for Territorial Citizens

    Citizens of US territories like Guam or Puerto Rico enjoy participation in US political process but are denied right to vote for president

    UN Syria Envoy: 'Devil Is in the Details' of Russian Aleppo Proposal

    UN uncertain about the possible humanitarian impact of Russian proposal to establish escape corridors in Aleppo

    This forum has been closed.
    Comments
         
    There are no comments in this forum. Be first and add one

    Featured Videos

    Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
    Uganda Unveils its First Solar-powered Busi
    X
    July 28, 2016 4:16 AM
    A solar-powered bus described by its Ugandan makers as the first in Africa has made its public debut. Kiira Motors' electric bus, Kayoola, displayed recently at a stadium in Uganda's capital. From Kampala, Maurice Magorane filed this report narrated by Salem Solomon.
    Video

    Video Uganda Unveils its First Solar-powered Bus

    A solar-powered bus described by its Ugandan makers as the first in Africa has made its public debut. Kiira Motors' electric bus, Kayoola, displayed recently at a stadium in Uganda's capital. From Kampala, Maurice Magorane filed this report narrated by Salem Solomon.
    Video

    Video Silicon Valley: More Than A Place, It's a Culture

    Silicon Valley is a technology powerhouse and a place that companies such as Google, Facebook and Apple call home. It is a region in northern California that stretches from San Francisco to San Jose. But, more than that, it's known for its startup culture. VOA's Elizabeth Lee went inside one company to find out what it's like to work in a startup.
    Video

    Video Immigrant Delegate Marvels at Democratic Process

    It’s been a bitter and divisive election season – but first time Indian-American delegate Dr. Shashi Gupta headed to the Democratic National Convention with a sense of hope. VOA’s Katherine Gypson followed this immigrant with the love of U.S. politics all the way to Philadelphia.
    Video

    Video Philadelphia Uses DNC Spotlight to Profile Historic Role in Founding of United States

    The slogan of the Democratic National Convention now underway in Philadelphia is “Let’s Make History Again” which recognizes the role the city played in the foundation of the United States in the 18th century. As VOA’s Kane Farabaugh reports, local institutions are opening their doors in an effort to capitalize on the convention spotlight to draw visitors, and to offer more than just a history lesson.
    Video

    Video A Life of Fighting Back: Hillary Clinton Shatters Glass Ceiling

    Hillary Clinton made history Thursday, overcoming personal and political setbacks to become the first woman to win the presidential nomination of a major U.S. political party. If she wins in November, she will go from “first lady” to U.S. Senator from New York, to Secretary of State, to “Madam President.” Polls show Clinton is both beloved and despised. White House Correspondent Cindy Saine takes a look at the life of the woman both supporters and detractors agree is a fighter for the ages.
    Video

    Video Dutch Entrepreneurs Turn Rainwater Into Beer

    June has been recorded as one of the wettest months in more than a century in many parts of Europe. To a group of entrepreneurs in Amsterdam the rain came as a blessing, as they used the extra water to brew beer. Serginho Roosblad has more to the story.
    Video

    Video First Time Delegate’s First Day Frustrations

    With thousands of people filling the streets of Philadelphia, Pennsylvania for the 2016 Democratic National Convention, VOA’s Kane Farabaugh narrowed in on one delegate as she made her first trip to a national party convention. It was a day that was anything but routine for this United States military veteran.
    Video

    Video Commerce Thrives on US-Mexico Border

    At the Democratic Convention in Philadelphia this week, the party’s presumptive presidential nominee, Hillary Clinton, is expected to attack proposals made by her opponent, Republican presidential nominee Donald Trump, to build a wall along the U.S.-Mexico border. Last Friday, President Barack Obama hosted his Mexican counterpart, President Enrique Peña Nieto, to underscore the good relations between the two countries. VOA’s Greg Flakus reports from Tucson.
    Video

    Video Film Helps Save Ethiopian Children Thought to be Cursed

    'Omo Child' looks at effort of African man to stop killings of ‘mingi’ children
    Video

    Video London’s Financial Crown at Risk as Rivals Eye Brexit Opportunities

    By most measures, London rivals New York as the only true global financial center. But Britain’s vote to leave the European Union – so-called ‘Brexit’ – means the city could lose its right to sell services tariff-free across the bloc, risking its position as Europe’s financial headquarters. Already some banks have said they may shift operations to the mainland. Henry Ridgwell reports from London.
    Video

    Video Recycling Lifeline for Lebanon’s Last Glassblowers

    In a small Lebanese coastal town, one family is preserving a craft that stretches back millennia. The art of glass blowing was developed by Phoenicians in the region, and the Khalifehs say they are the only ones keeping the skill alive in Lebanon. But despite teaming up with an eco-entrepreneur and receiving an unexpected boost from the country’s recent trash crisis the future remains uncertain. John Owens reports from Sarafand.
    Video

    Video Migrants Continue to Risk Lives Crossing US Border from Mexico

    In his speech Thursday before the Republican National Convention, the party’s presidential candidate, Donald Trump, reiterated his proposal to build a wall along the U.S.-Mexico border if elected. Polls show a large percentage of Americans support better control of the nation's southwestern border, but as VOA’s Greg Flakus reports from the border town of Nogales in the Mexican state of Sonora, the situation faced by people trying to cross the border is already daunting.

    Special Report

    Adrift The Invisible African Diaspora