Editor in Chief: Moh. Reza Huwaida Sunday, May 26th, 2019

The Reasons of Our Economic Failure

After the formation of National Unity Government (NUG), the citizens of the country were determined to see a change in the economic life of the country, but so far, they have not been able to experience anything worthwhile.
The reasons for the current state of affairs in the economy are rooted in the failure of Mr. Karzai’s thirteen-year-old government and lack of political will, vision, plan, and administrative mismanagement in NUG. These two cases are the cornerstone of this flawed evolution.
As we know, Afghanistan had an exceptional opportunity since the end of 2001 after the US military intervention and the end of Taliban regime and the establishment of a somewhat democratic regime, but it failed to use it efficiently and purposefully.
The new government began its economic activity in 1381, when its economy had undergone an exceptional opportunity after a period of stagnation and a decline in the economy. The interim government immediately estimated the financial damages at about $30 billion after the Bonn Accords in December 2001. After the preliminary assessments of the damage to the economy, the United Nations at the Afghanistan Reconstruction Conference in Tokyo in January 2002 promised that it will pay for reconstruction in Afghanistan an estimated amount of $10 billion for the past year, and some other countries and institutions participated in the $5 billion program in five years, which provided Afghanistan with $1.8 billion in the first year of 2002 and about $2 billion in 2003.
But even after the success of National Solidarity Program at that time and over a five-year period, and with the support of billions of dollars from the international community, the government was not able to determine its strategy for reconstruction and development. However, the government presented the second plan of a five-year program called the “National Development Strategy of Afghanistan” for funding in the Paris Conference on June 12, 2008, and again it implemented the program with a lot of deficiencies. It continued until 2012 (of course, the cost of the program was worth tens of millions of dollars, and the control of it was left to several individuals). The growth rates were not accurately predicted.
In brief, Mr. Karzai’s rule over thirteen years was not able to take advantage of the time, financial, monetary and military support and the presence of the international community (about forty countries), including the active presence of the United States, the United Nations and other institutions.
NUG is the direct product of the Karzai regime and the outcome of differences and conflicts that ensued at the start of its formation. As mentioned, the Karzai’s thirteen-year-old government failed to pave the way for economic growth and posterity.
The national unity government started work with the empty treasury, reducing aid, mistrusting citizens from security, and many other such issues. They made people over-optimistic through promises during the election campaign. The lack of a strong political will, a proper understanding of national interests, and the government’s inability to control the internal affairs made the situation even more difficult for NUG leaders.
The new government should, in the first step, should have carried out an accurate assessment of the overall state of the country, including the performance of thirteen years of the previous regime, and clearly set out all requirements and facilities (internal and external), based on a comprehensive National Development Strategy Plan. However, government had no strategy to offer except empty promises.
The government began to accelerate its work by launching a series of anti-corruption investigations in the Kabul Bank and the Ministry of Defense, where hundreds of embezzlers were involved; however, it was never able to reach all the culprits and the complete depth of the corruption that was carried out in such institutions of great importance. At the same time, it was not able to focus on new economic initiatives for the country.
Now, as a result of the weakness of the leadership and management of the national unity government, our country and our people are seeing the following unfavorable conditions:
a.             Increased insecurity and decrease in foreign investment (reports from the relevant department shows a 26% drop in investments over the past 9 months compared to 9 months of the previous year).
b.             Youth escape and increased immigration to Europe (according to UN Commissioners, around 122,000 Afghans have applied for asylum in 44 countries worldwide). 90 percent of these people are educated youth, which is the human capital of the country.
c.             Reducing domestic production and thus reducing economic growth.
d.             96% trade deficit.
e.             Inflation and depreciation of the Afghani.
f.              Increasing poverty rates
It is time for the government to come to terms with its failures, to review all the affairs on the basis of national interests and to take urgent measures to prevent the collapse of economic and social conditions. In the long run, it should start working on a major national and strategic plan. In these programs, internal and external opportunities and capacities should be accurately measured and pursued.
Strong political will, proper understanding of the situation, effective management, and the practicable national development plan will undoubtedly remove all barriers in way to progress, and the country will take steps to develop and provide its deprived people prosperity and peace.