Afghanistan Fact Sheet-Economic Environment

SOUND PUBLIC POLICIES

  • The Afghan economy has been growing in double digits in real terms for the last eight years, peaking at 22% in 2009
  • Constant GDP growth: 29% (2002), 23% (2003), 8% (2004), 14% (2005), 5.3% (2006) and 7.5% (2007)



    • Successful currency reform in late 2002 which stabilized inflation
    • Mobilization of domestic revenue- from nearly 0 (2001) to 4+% of GDP (2003)
    • Four fold increase roughly of GDP per capita to $600
    • GDP purchasing power parity has risen steadily since 2002
    • GDP per capita

    DEVELOPING INFRASTRUCTURE

    • Afghanistan’s Public Works Ministry announced that a 7.7 kilometer road will be built in Maimana, the capital of Afghanistan’s northern province of Faryab
    • Afghanistan’s Ministry of Mines and the state-owned China Metallurgical Group Corporation (MCC) signed an agreement today in Kabul in which the Chinese firm agreed to construct a railway corridor in Afghanistan.
    • New road network connecting cities within Afghanistan to neighbours
    • Creation of six industrial parks totalling more than 1,250 hectares (3,000 acres) to expedite professional, high quality industrial investments

    FACILIATING INVESTMENT, ENCOURAGING BUSINESS

    • The country's untapped minerals, including gold, iron, copper and cobalt, is valued by a U.S. estimate at nearly $1 trillion
    • Afghanistan is remarkably rich in mineral resources. There are currently more than 1,400 identified mineral deposits. These include energy minerals such as oil, gas and coal as well as iron and copper deposits of world quality
    • Since the year 2003, a total of $5.6 billion has been invested by the private sector in Afghanistan
    • Customs procedure streamlined and paperwork reduced by 90%
    • Financial sector reform- newly autonomous Central Bank, private banks
    • Investment laws allowing 100% foreign ownership
    • Use of Multi-Investment Guarantee Agency to mitigate perceived risks
    • Lowest import tariffs in the region (IMF Report January 4, 2005)
    • Exports increased by 76% in 2003 and 46% in 2004 (IMF Report, Jan. 2005)
    • Creation of Afghan Investment Support Agency by Presidential Degree

    AFGHAN INVESTMENT SUPPORT AGENCY

    • One-stop shop for investors (responsible for registration and licensing)
    • Simplified investment process from 28 steps to 5
    • Website: www.aisa.org.af