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Afghan economy growth projected at 1.5% in 2014

in Afghan Business

Afghan economy growth projected at 1.5% in 2014

world bankThe World Bank in its twice-a-year report—South Asia Economic Focus—has projected a gloomy 1.5% growth rate for Afghanistan’s economy for the year 2014.

Afghanistan is on the verge of a fiscal crisis, with declining revenues leading to an unfinanced fiscal gap in 2014.

The dismal growth rate is linked to the political upheaval and security uncertainty over the last several months.

According to the report, the new government is facing several challenges including restoring confidence in its economic prospects, creating over 400,000 jobs, aid dependence, corruption, persistent poverty and low levels of human development.

The report noted that the Afghan authorities need to prioritize the reform process in order to revive the economy.

It highlighted the agricultural sector as the foundation to trigger growth, as the sector accounts for about a quarter of the GDP and is linked to other parts of the economy, such as food and beverages, which forms most of the manufacturing sector and parts of transport and retail sectors.

The bank added that the economic growth could pick up pace if uncertainty is reduced and reforms are processed immediately.

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