Afghanistan Peace Campaign
Afghanistan has become increasingly dependent on Iran for trade, with 56% of its imports passing through the country, leaving its economy vulnerable to regional tensions and disruptions, the World Bank said in its latest Afghanistan Economic Monitor.
The report said Afghanistan’s economy grew by an estimated 4.8%, but warned the recovery has not improved living standards. Per-capita income continued to fall as rapid population growth, driven largely by the return of nearly 3.7 million Afghan migrants from Iran and Pakistan, outpaced economic expansion.
The World Bank also reported a 17% decline in exports in May compared with the previous month, while imports of machinery and other investment goods remained sharply lower, reflecting weak private-sector investment and continued financial constraints. It said India’s remained the largest export destination, while trade has increasingly shifted toward Iran after repeated disruptions at border crossings with Pakistan.
The report warned that Afghanistan remains heavily dependent on a narrow export base and external trade routes at a time when humanitarian needs remain severe. Aid reductions, high unemployment and limited access to international finance continue to weigh on the economy despite relative currency stability and steady domestic revenue collection.
Afghanistan is facing one of the region’s largest humanitarian crises, with millions of people requiring assistance after years of economic isolation, drought and conflict. The return of large numbers of deported Afghans from neighbouring countries has placed additional pressure on jobs, public services and already limited resources.
The World Bank said sustainable recovery will depend on expanding private-sector activity, improving access to finance, investing in infrastructure and creating employment opportunities, warning that current growth alone is insufficient to reverse worsening living conditions.