The International Monetary Fund (IMF) predicted the collapse of the economy of Afghanistan. The country’s GDP can dramatically be reduced by 30 percent after the capture of the Taliban authorities (the Taliban organization is recognized as terrorist and prohibited in the Russian Federation), reports CNBC.
The IMF noted that non-humanitarian assistance in the country was suspended, foreign assets are frozen, in addition, Afghan banks suffered due to lack of cash after the arrival of the Taliban. “These shocks can cause a reduction in production by 20-30 percent with a drop in imports, depreciation of Afghan and acceleration of inflation,” the Foundation says.
At the same time, the head of the Department of Middle East and Central Asia IMF Jihad Azur said that the situation in the country had worsened because of the coronavirus and droughts before the Taliban seized power in Kabul. “Therefore, what we foresee and what we fear are a sharp cut,” said Azur.
As the IMF notes, the problems in the country will lead to a drop in the standard of living – millions of people may be in poverty, which will lead to the humanitarian crisis. In addition, the increase in the number of Afghan refugees can put pressure on the labor market in host countries and create social tensions. For this reason, the IMF emphasized the need for assistance from the international community. Azur said that you should focus on education and medical care.
Earlier in October, the Chairman of the European Commission of Ursula von der Lenen stated that the EU will allocate Afghanistan an expanded support package for about one billion euros. The package includes 300 million euros in the form of humanitarian aid. At least 250 million euros will go to funding health and improving security.