• Friday, November 28, 2014

Dire Afghan economy on edge as investors flee

Afp, Kabul

Jackhammers are down and excavators gather dust at a Kabul construction site, spotlighting an aid-reliant economy on the edge of a precipice as Afghanistan's war winds down and a tenuous political transition looms.
The country's banks are at grave risk of being put on an international blacklist this month if parliament fails to pass a long-demanded money laundering bill -- with potentially devastating consequences for the already-fragile economy.
Economic growth fell through a cliff this year, touching a low of three percent from around 14 percent in 2012, with aid and investment in the war-ravaged country seeing an inexorable exodus.
The timing is largely to blame, observers say -- the year 2014 has come to symbolise a feared bogeyman for many Afghan businesses.
US plans to withdraw a bulk of its troops by December after 13-years of war, despite a resilient Taliban insurgency and next week's tense run-off election, has stoked concerns over the future of the country.
Askari Wahedi hasn't abandoned Afghanistan like several of his business peers who have transferred their wealth overseas and bought second homes in Dubai or Istanbul. At least not yet.
But the 28-year-old director of logistics company Askary Group has seen business evaporate in just a few months.


"I was here last year, now I am here," he said, swinging his hand from his head to his waist to illustrate his plunging fortunes.
Last year he had 15 contracts with the US army -- to provide logistical services such as operational maintenance and catering at military bases.
His turnover soared and he employed 300 people across various provinces including in Helmand and Kandahar -- Taliban-infested areas where joblessness is endemic.
But with military bases winding up operations as US forces pull out, he only has one contract left -- due to expire in two months -- forcing him to lay off 260 employees.
He also invested $2 million in constructing a six-storey residential tower -- where construction tools now lie idle and workers slumber in the shade. But in a sagging property market, he hasn't managed to sell a single apartment.

Published: 12:00 am Monday, June 09, 2014

Last modified: 12:49 am Monday, June 09, 2014

TAGS: economic growth Jackhammers Kabul construction site Taliban insurgency US plans

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