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Hole in Afghan budget to have negative impact on development projects

in Afghan Business

Hole in Afghan budget to have negative impact on development projects

finance ministryAfghan Ministry of Finance has expressed concerns at the USD 375mn hole in the government budget for this year.

The shortfall is likely to threaten public projects and civil servants’ salaries, putting the war-torn country in a deep stress as it awaits a new leader and foreign troops are preparing to withdraw.

Ministry of Finance officials have linked the hole in the budget to propaganda about the country’s elections and security situation and fall in investments, exports and agricultural produces.

“The hole in the budget is going to prevent us from implementing the development projects that we had planned for this year,” said Abdul Qadir, spokesperson to the Ministry.

This year’s budget stands at 428 billion Afghanis, of which 147bn is earmarked for development budget and 280bn for ordinary budget.

Meanwhile, some economic pundits have suggested obtaining loans from the central bank as a temporary solution to the problem.

Ministry of Finance officials have expressed optimism about the outcome of the elections and are hopeful that the country’s investment and exports would pick up pace after the new president is elected.

About 65% of the country’s budget is dependent on aid. Economic experts believe that the budget hole would expand further if the government did not tackle corruption and ensure transparency in the management of foreign aid.

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