AFGHANISTAN: Officials’ Optimism on Economy Belies Deep Poverty

• by Killid Correspondents* (kabul)
• Thursday, January 28, 2010
• Inter Press Service

Fardin Sediqi, chief of the Methodology and Supervision Department of the Ministry of Economy, says 'in the last two years poverty has declined from 42 percent to 36 percent.

From 2004 to 2009, says Aziz Shams, spokesperson of the Ministry of Finance, the average income of Afghan workers has grown six-fold from 70 U.S. dollars a year to 426 dollars.'

Shams adds that between 2003 and 2009 Afghanistan's annual revenue went up from 207 million dollars to 803 million dollars, and is expected to reach one billion dollars this year.

Add to this what the international community has pledged to the war-torn country since 2002 — 62 billion dollars, of which 35.4 billion dollars have been given to Afghanistan. Of this amount, eight billion dollars went to the Afghan government and the rest has been spent directly by the donor countries for Afghanistan or by non-government organizations.

Noorullah Delawari, president of the World Bank-funded private initiative Afghanistan Investment Support Agency, says that between 2002 and 2006 Afghanistan attracted 3.8 billion dollars worth of investments, of which 27 percent came from foreign investors and the rest from local entrepreneurs and business groups.

Delawari notes, however, that investments into Afghanistan have been on the decline in the last three years, but did not give details.

Whether a seemingly improving economic outlook has translated to the alleviation of poverty in Afghanistan remains to be seen. On the contrary, the picture looks dismal when viewed through another prism.

Despite 35.4 billion dollars having been delivered to Afghanistan in global aid since 2002, the nation still ranks the second poorest, after Niger in West Africa, among the 182 countries considered in the 2009 Human Development Report prepared by the United Nations Development Programme (UNDP).

Within the UNDP's human poverty index for 135 countries that fall below certain threshold levels based on the different dimensions of the human development index such as healthy life, Afghanistan ranks at the bottom.

The index shows that 40.7 percent of the estimated 25 million Afghans are not expected to live more than 40 years, 72 percent are illiterate, 78 percent do not have access to clean water and 39 percent of children under five years old are underweight, while the economic possibilities of an additional 20 percent of the population are deemed 'fragile.'

A report by the British-based nongovernmental organisation Oxfam says that one in five children dies before his or her fifth birthday.

Conceding that 'widespread poverty' afflicts Afghanistan, deputy minister of Agriculture Saleem Khan Kunduzi says the reasons for this are 'the ongoing insecurity, growing poppy cultivation, lack of job opportunities and continued drought.'

But to what extent these are feeding into poverty is not clear. For instance, there appears to be no significant impact of drought on famine — one of the major ills afflicting Afghanistan — based on data from the Ministry of Water and Energy.

Of the country's yearly 80 billion cubic metres (cu m) of water, only 30 billion cu m serve the country's needs and 50 billion cu m go to neighbouring countries, the officials of the ministry said.

Yet mismanagement of Afghanistan's water resources appears to be at the heart of the incidence of diseases known to have been triggered by polluted waters.

On top of improving the provision of basic services to the Afghan people to mitigate the impact of poverty, Khan Jan Alokozai, deputy president of the International Chamber of Commerce, sees the need to address the export-import imbalance.

'For the last couple of decades, Afghanistan has been a heavy consumer of products imported from neighbouring countries,' he says. Between 2000 and 2008, Afghanistan's export gross income grew from 300 million to 700 million dollars in stark contrast to the import value of six billion dollars every year during the same period, says Alokozai.

Key to development is agriculture, says the World Bank, which, if neglected, could result in a deep recession that would in turn lead to inflation.

Speen Jan Lalahand, lecturer and member of the Faculty of Agriculture at the University of Kabul, says that in the last eight years agriculture has not been a development priority for the Afghan government. This, he says, explains why no agricultural project has been successfully implemented in the country. Improving exports could be a prime source of revenue for agricultural producers, he stresses.

Deputy minister Kunduzi believes that lack of adequate manpower is fuelling underdevelopment in agriculture. According to Mohammad Ramin Atiqzad, secretary general of the Central Statistics Office of Afghanistan, 80 percent of Afghans depend on farming activities as their main sources of livelihood.

Kunduzi adds that much of the cultivatable land in Afghanistan is now unused. Of this fallow land, 2.1 million hectares are irrigable and 1.5 million are rain-fed.

Still, he is optimistic about the prospects for increased agricultural produce such as rice, corn, vegetable and fruits in the coming years. To implement a five-year-plan in this direction, the agriculture ministry needs 8 billion dollars, says Kunduzi, half of which should be spent on rebuilding and rehabilitating irrigation systems and dams, while the rest will go to animal husbandry projects.

Against this backdrop, the Ministry of Rural Rehabilitation and Development (MRRD) is now looking forward to the next five years and a 1.5-billion dollar development plan for small-scale undertakings.

Since 2001 it has channeled one billion dollars to local initiatives. According to Wais Barmak, deputy minister of MRRD, over 800 million dollars have been spent on 50,000 small-scale projects throughout Afghanistan, with funding delivered to 22,000 local administrative councils in 34 provinces.

'In addition,' he says, 'we have supported micro-finance projects that helped many rural women to start their own businesses, the reconstruction of small roads and potable water distribution.'

Notwithstanding the generally positive outlook conveyed by some government data and the officials’ upbeat mood on the economy, it still remains to be seen whether Afghanistan really puts its money — however small or big — where its mouth is.

*(Killid is an independent Afghan media group. IPS and Killid have been partners since 2004.)

© Inter Press Service (2010) — All Rights ReservedOriginal source: Inter Press Service

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