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US: Afghanistan's Economic Prospects 'Bleak'

Afghan man removes broken chairs from his shop near the site of a suicide car bomb attack in Surkhrod district of Nangarhar province, Dec. 7, 2015.

A U.S. government auditor says despite more than a decade of reconstruction and development efforts, Afghanistan’s economy remains in fragile and worsening condition.

“Intractable insurgents, cutbacks in foreign military personnel, persistent emigration of people and capital, and a slowing global economy are shifting Afghanistan’s economic prospects from troubling to bleak,” the Special Inspector General for Afghanistan (SIGAR) said in its quarterly report released on Friday.

It went on to warn that Afghanistan proved even more dangerous than it was a year ago, saying the Taliban is now in control of more territory than at any time since 2001. It quoted a U.S. military report that said approximately 71.7 percent of the country’s districts are under Afghan government control or influence.

The lack of security has made it almost impossible for many U.S. and even some Afghan officials to get out to manage and inspect U.S.-funded reconstruction projects, SIGAR added.

“The dangers of absent oversight were exposed when a task force appointed by President Ashraf Ghani reportedly found that millions of dollars were being embezzled while Afghanistan pays for numerous nonexistent “ghost” schools, “ghost” teachers, and “ghost” students,” it said.

The inspector general said Afghanistan’s domestic revenues covered only 40 percent of budget expenditures through the first 11 months of the fiscal year. He predicted the country’s large budget deficits and trade imbalances will require substantial donor aid for the foreseeable future.

SIGAR said cumulative funding for Afghanistan reconstruction increased to approximately $113.1 billion, with approximately $11.5 billion of this amount available for potential disbursement. A total of $8.4 billion of the reconstruction funding has been provided for counternarcotics efforts in Afghanistan.

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