Afghanistan, Kabul, March 04, 2021—Ten potential new markets for Afghan produce will be identified as part of upcoming work by IFC, a member of the World Bank Group, in concert with the government of Afghanistan and the private sector, to increase market competitiveness, create jobs, and drive economic growth in the country.
A key focus of the work, which is in line with the government's multi-year action plan, the AgriBusiness Charter, will be to devise strategies to strengthen agribusiness, particularly for dried fruits and nuts as well as fresh fruits and vegetables. The aim is to help mitigate negative impacts triggered by the COVID-19 pandemic, and create a sustainable roadmap for recovery in Afghanistan.
Afghanistan's export industry has been heavily impacted by the pandemic. In 2019, Afghanistan's exports surpassed $1 billion—a 15 percent increase from 2018. However, in the wake COVID-19 impacts, over 60 percent of firms in the export sector were either partially open or temporarily closed. Eighty-eight percent of businesses, on average, saw a 61 percent decline in sales, according to a recent Business Pulse Survey.
Some of the major constraints hindering the agribusiness sector's export potential in Afghanistan include regulatory and procedural bottlenecks, limited industrial infrastructure, inadequate cold chain and warehouse facilities, and constricted transport logistics.
"Increasing Afghanistan's exports remains a top priority for the Ministry. Rising exports will help increase Aggregate Demand and cause higher economic growth. Through the successful implementation of this project, we will ensure that public-private dialogues are conducted, ensure that the current export process bottlenecks are understood, facilitate market access, and promote and facilitate investment," said Nesar Ahmad Faizi Ghuriany, Minister of Industry and Commerce, Afghanistan. "The components outlined in this project will fuel an innovative approach towards strengthening targeted value chains. In coordination with all stakeholders, the Ministry of Industry and Commerce remains committed to successfully implement this project."
Against this backdrop, IFC, in partnership with USAID, will collaborate with the Ministry of Industry and Commerce and the Ministry of Agriculture, Irrigation and Livestock to provide support, including analyzing specific market requirements for key perishable goods and advice on streamlining the export process, such as obtaining quarantine certificates.
"One of IFC's priorities in Afghanistan is the agribusiness sector, which is a key driver of the Afghan economy. IFC will help spur investments by identifying new opportunities in targeted value chains to enhance export competitiveness," said Nadeem A. Siddiqui, IFC Senior Country Manager for Afghanistan and Pakistan." As the country rebuilds after the pandemic, promoting high-quality agricultural exports to broader regional and global markets will attract new investments and accelerate the country's economic recovery."
Afghanistan's current export destinations—more than 90 percent of exports go to India, Pakistan, and Iran—are limited to less profitable markets, impeding its full trade potential. With this in mind, the project will identify potential markets for Afghan produce while ensuring that exporters (mostly smaller enterprises) have access to necessary market information, including regulatory and packaging requirements, as well as food safety standards. This will help Afghan businesses comply with new international market requirements and make more informed decisions.
About IFC
IFC—a member of the World Bank Group—is the largest global development institution focused on the private sector in emerging markets. We work in more than 100 countries, using our capital, expertise, and influence to create markets and opportunities in developing countries. In the fiscal year 2020, we invested $22 billion in private companies and financial institutions in developing countries, leveraging the power of the private sector to end extreme poverty and boost shared prosperity. For more information, visit www.ifc.org
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