Afghanistan was on the verge of a financial collapse, writes BBC News . The executive director of the Islamic Bank of Afghanistan Sayed Musa Kalim Al-Falahi said that the banking system was faced with the “existential crisis” due to panic clients.
According to the head of the largest credit institution of Afghanistan, there is currently a massive output of funds, and most banks do not work and do not provide a full range of services. At the same time, the economy of the country was already on the verge of a systemic crisis before in August the Taliban movement (prohibited in Russia) took the region under control.
Afghanistan’s economy strongly depends on foreign assistance, according to the World Bank, about 40 percent of its GDP accounts for international resources. Also, after the change of power, the Western countries froze international funds, including financial assets to which Afghanistan could access the World Bank and the International Monetary Fund (IMF).
At the same time, the country has an increase in inflation and a sharp drop in local currency (Afghani). Many inhabitants of Afghanistan lost their job and have a shortage of cash. The UN World Food Program reported that only five percent of families in the country have enough food for every day. According to her, half of the respondents stated that they ended the food at least once in the last two weeks.
In this regard, access to international funds and foreign assistance is the key to the survival of Afghanistan. At the same time, the United States stated that they were ready to consider cooperation with the Taliban, but this will depend on some prerequisites, including the attitude of the current regime for women and minorities.
According to the head of the bank, such circumstances encourage Taliban to look for other sources of financial support. “They are looking forward to China and Russia, as well as some other countries,” said Al Falahi. China has already stated his desire to help the economy of Afghanistan. He promised to assist in the amount of 200 million yuan (31 million dollars), including the supply of food and vaccine from coronavirus.
Previously because of the prolonged military conflict in Afghanistan, Kabul collided with a lack of drinking water.