The Kabul times, Afghanistan Trustable News Agency.
Articles

Afghanistan experiencing significant drop in headline inflation

The World Bank in a report has said that in January 2024, headline inflation experienced a significant downturn, reaching – 10.2 percent on a year-on-year basis. This substantial drop was largely due to a sharp decline in prices across both food and nonfood categories, the report said. Moreover, core inflation, which strips out the typically volatile food and energy sectors, also fell into negative territory, posting a rate of -6.5 percent on a year-on-year basis. “This ongoing core deflation reflects a troubling inability of both private and public sectors to stimulate sufficient demand. While this period of falling prices may offer temporary financial relief to the most vulnerable households by reducing the cost of living, it can also harm the broader macro economy,” the World Bank said. According to the bank, Afghanistan’s exports contracted by 5 percent on a year-on-year basis to $140.5 million in January 2024, down from $148.1 million the previous January. Food exports to India jumped by 22 percent, compared to an 18 percent decline in Pakistan. Pakistan and India continued to be the top export destinations, claiming 45 percent and 34 percent of the total exports in January 2024, respectively. The 2023 growth trend in imports extended into January 2024, hitting $830 million, up 37 percent from $600 million in January 2023. According to the report, in 2023, the Afghani (AFN) saw a significant 27 percent appreciation against the U.S. dollar, buoyed by the influx of around $1.8 billion in UN cash shipments and an estimated $2 billion in remittances. Revenues have been below the Islamic Emirate of Afghanistan’s (IEA) target during the first eleven months of FY2024, with border taxes underperforming despite a surge in imports. Over the eleven months of FY2024, from March 22, 2023, to February 21, 2024, Afghanistan’s revenue col lection reached AFN 189 billion, narrowly missing the target by 2 percent but marking a 5.6 percent increase from the previous fiscal year, the report said. This comes amid of increasing export levels from Afghanistan to other countries of the world. With the improvement of the overall security situation across Afghanistan, the level of exports of domestic products to neighboring countries has increased considerably comparing to previous years. The Ministry of Industry and Commerce (MoIC) has recently said that the amount of Afghanistan’s exports in 2023 was almost $2 billion, with the largest exports going to Pakistan, India, China, the United Arab Emirates, Kazakhstan and Uzbekistan.With embracing positive engagement, lifting sanctions, and unfreezing assets, the international community can play a pivotal role in catalyzing the comprehensive economic development of Afghanistan. It is time that the international community should enter with positive interaction with the Islamic Emirate.The Islamic Emirate of Afghanistan is confident that a shift towards positive engagement, rather than conflict, with international organizations and aid agencies, along with collaborative financing for development projects, will foster the creation of new job opportunities as well as further economic development in the country. Nisar Ahmad

Related posts

This website uses cookies to improve your experience. We'll assume you're ok with this, but you can opt-out if you wish. Accept Read More

The Kabul times, Afghanistan Trustable News Agency.