Afghanistan Economic Update, April 2013
One year into the transition process, Afghanistan sustains robust economic growth. An exceptional harvest, supported by the launch of first large-scale mining activities, increased real gross domestic product (GDP) growth from 7.3 percent to an est...
| Main Authors: | , , |
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| Format: | Working Paper |
| Language: | English en_US |
| Published: |
World Bank, Washington, DC
2014
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| Subjects: | |
| Online Access: | http://documents.worldbank.org/curated/en/2013/04/17659303/afghanistan-economic-update http://hdl.handle.net/10986/16510 |
| Summary: | One year into the transition process,
Afghanistan sustains robust economic growth. An exceptional
harvest, supported by the launch of first large-scale mining
activities, increased real gross domestic product (GDP)
growth from 7.3 percent to an estimated 11.8 percent in
2012. Inflation dropped to 6.4 percent and continuing high
levels of aid helped to build up further international
reserves. The medium-term outlook is tainted by uncertainty.
Political and security uncertainties are expected to limit
private-sector growth in the coming years. Increased public
spending, however, will continue to fuel demand for services
and construction through 2013. The transition process
exposes Afghanistan to a number of serious risks, such as
rising financing for public service provision. Security
considerations aside, promoting sources of inclusive
economic growth, especially agriculture, and strengthening
domestic revenue mobilization will be important to mitigate
some of these risks. In particular, a stronger reform effort
in areas such as tax policy and customs is required to
safeguard past gains in development. Finally, improvements
in the legal and regulatory environment of mining could help
to secure planned investment. |
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