Economy

Border closures deepen market strain across Afghanistan, report finds

A market in Kandahar City. Feb. 2026. File photo.

Border restrictions, insecurity and regional trade disruptions are placing growing pressure on markets across Afghanistan, disrupting supply chains, increasing prices and weakening purchasing power, according to a new assessment released by the humanitarian research group REACH Initiative.

The report found that eastern and southeastern Afghanistan were among the hardest-hit regions, where traders reported temporary shop closures, supply shortages and increasing difficulties restocking goods.

The assessment, based on market monitoring conducted in April 2026, said disruptions linked to insecurity and restrictions on cross-border movement — particularly along the Afghanistan-Pakistan border — had significantly affected traders’ operations and local markets.

The report said many local markets remain heavily dependent on imported goods and regional trade routes, leaving them vulnerable to even short-term border closures and transportation disruptions.

Across multiple regions, traders reported rising supplier costs, higher transportation expenses and increasing reliance on credit to purchase commodities. Many vendors also said they were struggling to meet demand for both food and non-food items.

In eastern provinces including Nangarhar, Kunar and Nuristan, 24 percent of assessed markets reported temporary closures linked to conflict, while 78 percent of vendors said food prices had increased.

Many traders in those areas attributed rising prices to transportation costs and conflict-related disruptions. Vendors also reported mass purchasing of essential items including flour, sugar and vegetable oil.

The southeastern provinces of Khost and Paktika faced some of the most severe disruptions.

Nearly half of assessed markets in the region reported temporary closures, while 98 percent of vendors said food prices had increased. Eighty-five percent of traders said they had borrowed money or purchased goods on credit to continue operating.

In Paktika, many vendors reported declining demand because residents lacked sufficient income to buy food and household goods.

The report said western and southern Afghanistan appeared comparatively less affected by direct market shutdowns, though traders there also reported growing financial pressure and reduced consumer demand.

In Herat and Farah, half of assessed vendors reported declining demand for food items because of rising prices and worsening economic conditions.

In southern provinces such as Kandahar and Nimroz, most markets remained operational, but traders still reported higher transport costs, seasonal price increases and difficulties obtaining supplies through traditional trade routes.

The assessment linked many of the disruptions to deteriorating regional security conditions and recurring tensions along Afghanistan’s borders since late 2025.

Trade disruptions involving both Pakistan and Iran have increasingly affected Afghanistan’s imports and exports in recent months, raising concerns among traders and economists about inflation and shortages of essential goods.

Aid groups and economic analysts have warned that prolonged border disruptions could further strain Afghanistan’s fragile economy, where millions of people already face poverty, unemployment and food insecurity.

The REACH assessment was conducted through Afghanistan’s Joint Market Monitoring Initiative, which surveys vendors across markets nationwide to track prices, availability of goods and market conditions.