One Year Later, Taliban Unable to Reverse Afghanistan’s Economic Decline

One Year Later, Taliban Unable to Reverse Afghanistan’s Economic Decline

Monday, August 8, 2022

By: William Byrd, Ph.D.

Afghanistan’s economy was already deteriorating before the Taliban takeover of the country on August 15, 2021, suffering from severe drought, the COVID-19 pandemic, declining confidence in the previous government, falling international military spending as U.S. and other foreign troops left, human and capital flight, and Taliban advances on the battlefield. Then came the abrupt cutoff of civilian and security aid (more than $8 billion per year, equivalent to 40% of Afghanistan’s GDP) immediately after the Taliban takeover. No country in the world could have absorbed such an enormous economic shock — exacerbated by sanctions, the freezing of Afghanistan’s foreign exchange reserves and foreign banks’ reluctance to do business with the country.

Type: Analysis

Democracy & GovernanceEconomics

Reviving Commercial Development of Afghanistan’s Aynak Copper Resource

Reviving Commercial Development of Afghanistan’s Aynak Copper Resource

Thursday, September 21, 2017

By: William Byrd, Ph.D.

While other, smaller mineral resources are being rampantly looted, Afghanistan’s large Aynak copper deposit—worth upward $50 billion—has languished unexploited despite being contracted to a Chinese consortium nearly a decade ago. This Peace Brief seeks to understand what went wrong and explores options for breaking out of the current impasse. Resuscitating the development of Aynak, though challenging, would send a powerful signal of beneficial exploitation of Afghanistan’s mineral resources.

Type: Peace Brief

EnvironmentDemocracy & GovernanceEconomics

Drugs in Afghanistan—A Forgotten Issue?

Drugs in Afghanistan—A Forgotten Issue?

Friday, May 18, 2012

By: William Byrd;  David Mansfield

This paper reflects both authors' concern that neglect of the opium economy in coming years could be perilous, exacerbate problems, possibly lead to poorly thought-out knee-jerk reactions and/or simplistic responses which would only worsen the situation, and further damage the prospects for success of what will inevitably be a difficult and challenging process of transition in Afghanistan.

Type: Peace Brief

Conflict Analysis & Prevention

What Can Be Done to Revive Afghanistan’s Economy?

What Can Be Done to Revive Afghanistan’s Economy?

Tuesday, February 9, 2016

By: William Byrd, Ph.D.

Reviving the Afghan economy during a time of intensifying violent conflict, declining external financial aid, and ongoing political uncertainty and dysfunction will be extremely challenging. But the country cannot wait for these entrenched problems to be addressed. While keeping expectations modest, this report proposes some targeted, near-term measures to increase confidence and stimulate the economy. Rather than engaging in politics as usual and following conventional policy prescriptions t...

Type: Special Report

EnvironmentDemocracy & GovernanceGlobal PolicyEconomics

Two Years into Taliban Rule, New Shocks Weaken Afghan Economy

Two Years into Taliban Rule, New Shocks Weaken Afghan Economy

Thursday, August 10, 2023

By: William Byrd, Ph.D.

The Taliban have done a better job than expected in managing the Afghan economy despite some missteps. But nevertheless, the Afghan economy seems caught in a low-level equilibrium that leaves most Afghans poor, hungry and in need of humanitarian assistance. Moreover, new headwinds threaten to precipitate further economic decline, risking a repeat of the economic free-fall seen in the initial months following the August 2021 Taliban takeover. Much will depend on whether aid declines sharply or gradually, how seriously the opium ban is enforced for a second year during this fall’s planting season, and whether Taliban gender restrictions are tightened, maintained or weakened.

Type: Analysis

Economics

The Taliban’s Successful Opium Ban is Bad for Afghans and the World

The Taliban’s Successful Opium Ban is Bad for Afghans and the World

Thursday, June 8, 2023

By: William Byrd, Ph.D.

The Taliban have done it again: implementing a nearly complete ban against cultivation of opium poppy — Afghanistan’s most important agricultural product — repeating their similarly successful 2000-2001 prohibition on the crop. But the temptation to view the current ban in an overly positive light — as an important global counter-narcotics victory — must be avoided. This is particularly true given the state of Afghanistan’s economy and the country’s humanitarian situation. Indeed, the ban imposes huge economic and humanitarian costs on Afghans and it is likely to further stimulate an outflow of refugees. It may even result in internal challenges for the Taliban itself. And, in the long run, it will not have lasting counter-narcotics benefits within Afghanistan or globally.

Type: Analysis

Economics

Afghanistan’s Crisis Requires a Coherent, Coordinated International Response

Afghanistan’s Crisis Requires a Coherent, Coordinated International Response

Tuesday, May 16, 2023

By: William Byrd, Ph.D.

Over the past year, especially in recent months, the Taliban have made several missteps. The consequences are not a threat to their power in the short run but will damage their ability to govern as well as, potentially, their longer-term cohesion. Unfortunately, these missteps will harm the Afghan people much more, both directly and through their adverse impact on humanitarian aid.

Type: Analysis

Global Policy

Wrestling with a Humanitarian Dilemma in Afghanistan

Wrestling with a Humanitarian Dilemma in Afghanistan

Wednesday, January 25, 2023

By: William Byrd, Ph.D.

Recent decrees by the Taliban barring Afghan women from attending university or working in NGOs are severely damaging the country both socially and economically, especially coming atop a ban on girls’ secondary education last year. The marginalization of half the population also highlights the “humanitarian dilemma” that aid donors and international agencies face: Afghanistan is highly dependent on humanitarian assistance, not only for saving lives and easing deprivation but also to stabilize its economy. The quandary for international donors is what to do when alleviating suffering benefits the Afghan economy and thereby the Taliban regime, even when that regime is harming its own people?

Type: Analysis

Economics