A survey by the World Bank shows a 62% reduction in female employment in Afghanistan over the last year following the fall of the previous government.
However, the survey says it was 75% in November 2021, nearly two months after Taliban takeover.
The survey focuses on the private sector in Afghanistan, which has been a main driver of the country’s economy over the past two decades.
It shows that employment remained around 50% lower, on average, than before August 2021, compared to 61% lower in Round 1 of the survey – which was conducted two months after the fall of the previous government.
Women-owned businesses are most affected by restrictions on women’s mobility, resulting in disproportionate revenue and job losses, the survey says.
It shows that more than three-fourths of firms surveyed in Round 2 – from May to June – are operational, compared to two-thirds in Round 1 of the survey.
However, most are operating significantly below their full capacity and are only considered partially open, the World Bank survey says.
Consumer demand appears to have slightly improved in past months but remains considerably lower than before August 2021, according to the survey.
World Bank assessment shows that businesses continue to be negatively impacted by the loss of international banking relationships, which has disrupted international payments and limited access to bank accounts and formal banking.
Firms are resorting to the use of informal money transfer systems for domestic payments, the assessment shows, adding that 58% of respondents reported that making domestic payments was difficult, compared to 82% in the first survey.
Firms are also struggling to obtain inputs: imports are costlier due to border closures and non-availability in the local markets; domestic inputs remain a challenge, owing mainly to price inflation and the closures of suppliers’ businesses, the survey indicates.
Despite some businesses hiring employees, the majority of respondents have coped with these challenges by laying off employees, shifting to cash and informal payment channels, shrinking investments, and lowering staff salaries.
Overall levels of corruption with respect to paying taxes and clearing goods through customs are significantly down compared to one year ago, the survey says, but adds that there are signs of an uptick in the past six months.
Two-thirds of firms surveyed reported having made unofficial payments before August 2021, 3% reported making these payments between August and November 2021 (Round 1), and 8% since November 2021 (Round 2).
According to World Bank, many firms in Afghanistan are adjusting to the new business environment but most still face daunting challenges.
“Afghanistan continues to face enormous social and economic challenges that are impacting heavily on the welfare of its people, especially women, girls, and minorities,” said Melinda Good, World Bank Country Director for Afghanistan.
“The new survey confirms the resilience of Afghanistan’s private sector, which can play a key role in the economic recovery of the country and improving the lives of all Afghans,”
She suggested action is required by the authorities to unlock possibilities for much-needed international economic integration and domestic opportunities for Afghanistan’s private sector.
Reduction in international aid
Taliban blames the significant reduction in international community’s assistance and the frozen central bank assets by the US as two main factors that have affected the people’s economy, especially women and children.
“Our demand from the international community is that it should keep humanitarian assistance away from political issues,” said Abdul Latif Nazari, the deputy minister of Taliban for the ministry of economy.
Experts said the banking system in Afghanistan has been affected over the past year and this has negatively impacted the private sector.
“The paralyzing banking system can further damage Afghanistan’s economy… Investors cannot ensure on time transfer of money abroad to buy goods,” said Siyar Quraishi, a banking analyst.