Afghanistan is a member of the South Asian Association for Regional Cooperation (SAARC), Economic Cooperation Organization (ECO) and the Organization of the Islamic Conference (OIC). It is an impoverished country, one of the world's poorest and least developed. As of 2008, the nation's unemployment rate is 35%[135] and roughly 36% of its citizens live below the poverty line.[136] Two-thirds of the population live on fewer than 2 US dollars a day. The nation's economy has suffered greatly from the 1978 to 2001 conflicts, while severe drought added to the nation's difficulties in 1998–2001.[137] However, due to the infusion of multi-billion dollars in international assistance and investments, as well as remittances from expats[138], the economy of this war-torn country is slowly improving. It is also due to improvements in agricultural production, which is the backbone of the nation's economy since nearly 80% of its citizens are involved with this line of work.[139] Afghanistan is known for producing some of the finest pomegranates, grapes, apricots, melons, and several other fresh and dry fruits, including nuts.[140] According to the World Bank, "economic growth has been strong and has generated better livelihoods" since late 2001.[141]
The Badam Bagh fruit processing plant
As much as one-third of the nations's GDP comes from growing illicit drugs, including hashish and opium. Opium production in Afghanistan has soared to a record in 2007 with some 3.3 million Afghans reported to be involved in the business.[142] However, it began declining significantly in the next few years.[143] The Afghan government began programs to reduce the cultivation of poppy and by 2010 it was reported that 24 out of the 34 provinces are free from poppy cultivation.
As much as one-third of the nations's GDP comes from growing illicit drugs, including hashish and opium. Opium production in Afghanistan has soared to a record in 2007 with some 3.3 million Afghans reported to be involved in the business.[142] However, it began declining significantly in the next few years.[143] The Afghan government began programs to reduce the cultivation of poppy and by 2010 it was reported that 24 out of the 34 provinces are free from poppy cultivation.
Afghan rug weavers
One of the main drivers for the current economic recovery is the return of over 5 million Afghan refugees from neighbouring countries, who brought with them fresh energy, entrepreneurship and wealth-creating skills as well as much needed funds to start up businesses. Afghan rugs have become a popular product again and this gives the large number of rug weavers in the country a chance to earn more income. While the country's current account deficit is largely financed with the donor money, only a small portion – about 15% – is provided directly to the government budget. The rest is provided to non-budgetary expenditure and donor-designated projects through the United Nations system and non-governmental organizations.
The country's foreign exchange reserves total about $3.781 billion as of March 2010.[144] The Afghan Ministry of Finance is focusing on improved revenue collection and public sector expenditure discipline. The rebuilding of the financial sector seems to have been so far successful. Since 2003, over sixteen new banks have opened in the country, including Afghanistan International Bank, Kabul Bank, Azizi Bank, Pashtany Bank, Standard Chartered Bank, First Micro Finance Bank, and others. Da Afghanistan Bank serves as the central bank of the nation and the "Afghani" (AFN) is the national currency, which has been performing steadily for the last eight years with an exchange rate of about 45 Afghanis to 1 US dollar.
One of the main drivers for the current economic recovery is the return of over 5 million Afghan refugees from neighbouring countries, who brought with them fresh energy, entrepreneurship and wealth-creating skills as well as much needed funds to start up businesses. Afghan rugs have become a popular product again and this gives the large number of rug weavers in the country a chance to earn more income. While the country's current account deficit is largely financed with the donor money, only a small portion – about 15% – is provided directly to the government budget. The rest is provided to non-budgetary expenditure and donor-designated projects through the United Nations system and non-governmental organizations.
The country's foreign exchange reserves total about $3.781 billion as of March 2010.[144] The Afghan Ministry of Finance is focusing on improved revenue collection and public sector expenditure discipline. The rebuilding of the financial sector seems to have been so far successful. Since 2003, over sixteen new banks have opened in the country, including Afghanistan International Bank, Kabul Bank, Azizi Bank, Pashtany Bank, Standard Chartered Bank, First Micro Finance Bank, and others. Da Afghanistan Bank serves as the central bank of the nation and the "Afghani" (AFN) is the national currency, which has been performing steadily for the last eight years with an exchange rate of about 45 Afghanis to 1 US dollar.
Energy and mining
According to recent U.S. Geological Surveys that were funded by the Afghan Ministry of Mines and Industry, Afghanistan may be possessing up to 36 trillion cubic feet (1,000 km3) of natural gas, 3.6 billion barrels (570,000,000 m3) of petroleum and up to 1,325 million barrels (2.107E+8 m3) of natural gas liquids.[145] Other recent reports show that the country has huge amounts of gold, copper, coal, iron ore and other minerals.[37][146][147] In 2010, U.S. Pentagon officials along with American geologists revealed the discovery of nearly $1 trillion in untapped mineral deposits in Afghanistan.[40] Afghan officials assert that "this will become the backbone of the Afghan economy" and a memo from the Pentagon stated that Afghanistan could become the "Saudi Arabia of lithium".[148] Some believe, including Afghan President Hamid Karzai, that the untapped minerals could be as high as $3 trillion.[149][150][151] The government of Afghanistan is preparing deals to extract its copper and iron reserves, which will earn billions of dollars in royalties and taxes every year for the next 100 years.[152][153] These untapped resources could mark the turning point in Afghanistan's reconstruction efforts. Energy and mineral exports could generate the revenue that Afghan officials need to modernize the country's infrastructure, and expand economic opportunities for the beleaguered and fractious population.
Transport and communications
Ariana Afghan Airlines
Ariana Afghan Airlines is the national airlines carrier, with domestic flights between Kabul, Kandahar, Herat and Mazar-e Sharif. International flights include to Dubai, Frankfurt, Istanbul and a number of other Asian destinations.[154] There are also limited domestic and international flight services available from the locally owned Kam Air, Pamir Airways and Safi Airways.
Ariana Afghan Airlines
Ariana Afghan Airlines is the national airlines carrier, with domestic flights between Kabul, Kandahar, Herat and Mazar-e Sharif. International flights include to Dubai, Frankfurt, Istanbul and a number of other Asian destinations.[154] There are also limited domestic and international flight services available from the locally owned Kam Air, Pamir Airways and Safi Airways.
Ariana Afghan Airlines
The country has limited rail service with Turkmenistan and Uzbekistan in the north. There are two other railway projects currently in progress with neighboring nations, one is between Herat and Iran while another is to connect with Pakistan Railways.
Most citizens who travel far distances use long traveling bus services. Newer automobiles have recently become more widely available after the rebuilding of roads and highways. Vehicles are imported from the United Arab Emirates through Pakistan and Iran. Postal and package delivery services such as FedEx, DHL and others exist in major cities and towns.
Telecommunication services in the country are provided by Afghan Wireless, Etisalat, Roshan, Areeba and Afghan Telecom. In 2006, the Afghan Ministry of Communications signed a 64.5 million agreement with ZTE Corporation for the establishment of a countrywide optical fiber cable network.[155] As of 2008, the country has 460,000 telephone lines[156], 8.45 million mobile phone users[157] and around 500,000 people (1.5% of the population) have internet access.[158]
