Coronavirus outbreak has brought dramatic changes to the world economy. One of the most hit nations from the pandemic is Afghanistan with 40 percent of its population below the poverty line. With widespread poverty across the rural and urban areas, Afghanistan is amongst the poorest countries in the world. Besides the fight against the deadly virus outbreak, the landlocked country will have to deal with the economic ramifications of COVID-19.
In order to contain the virus, Afghanistan announced strict lockdown and quarantine measures. However, the pandemic lockdown has drastically impacted major sources of income in the country. Afghanistan’s agricultural sector provides employment to at least 70 percent of the population and contributes to 30 percent of the country’s GDP. With lockdown, a decrease in employment in the sector will lead to disruption in the demand-supply chain which will adversely affect the GDP of the country.
The country under the administration of President Ashraf Ghani is heavily dependent on imports from all across the world, with its annual imports surpassing its exports. The worldwide lockdown has impacted the trading in the country, which further will dent its economy. Not to forget, the sector is major source of revenue for the Afghan government.
The temporary shutdown of manufacturing industries and service sectors due to the lockdown will also have grave implications on the annual revenue of the government.
Just before the COVID-19 crisis hit the country, the Afghan government was looking forward to establishing a peace agreement with the Taliban in the light of the peace deal signed between the insurgent group and the United States. However, even the peace deal is facing some blockages The unforeseen health crisis shifted the focus of the Afghan government from some major events that would have helped the country’s survival in the geopolitical discourse.
In the meantime, with the pandemic on the rise, Afghan’s health sector is at the forefront of protecting the citizens from the virus. As of April 11, the country has over 500 confirmed COVID-19 cases. But, the need of the hour for the Afghan government is to formulate plans and policies to survive prospective economic crisis not just in the country, but in the world economy as well.
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