PESHAWAR: Shifting from insurgency to governance, the Taliban will face daunting economic challenges to govern the devastated Afghanistan at the tumultuous end of 20-year-long war that has brought the economy on the brink of collapse.
The insurgent group is working to unveil the new government setup after capturing Kabul on 15 August. According to the British news agency Reuters, Taliban leader Ahmadullah Muttaqi wrote on social media that a ceremony is being held at the presidential palace in Kabul while the private news channel ToloNews says that the announcement of the new government will be made soon. A senior Taliban leader told media last month that Amir Hibatullah Akhunzada of the Islamic Movement was expected to have final control over the governing council.
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Analysts say the new government’s legitimacy in the eyes of international donors and investors would be crucial for Afghanistan’s economy, which has been in decline since the Taliban returned to power. The Taliban emir has three deputies, one of whom is Maulvi Yaqub, the son of former emir Mullah Omar. The second is the head of the powerful Haqqani Network, Sirajuddin Haqqani, and the third is Mullah Abdul Ghani Baradar, one of the founding members of the Taliban.
The Taliban want to present a more moderate face to the world after removing the US-backed government and returning to power last month. However, the United States, the European Union and others have expressed skepticism over the Taliban’s assurances, saying that formal recognition of the new government and financial support depend on their actions.
US Deputy Secretary of State Victoria Nuland told a news conference on Wednesday, “We will not judge them by their words but by their actions.” The European Commission also said that it will not formally recognize the Taliban unless it forms a comprehensive government, respects human rights and provides unconditional support to aid workers.
Economic catastrophe
Aid groups, meanwhile, have warned against severe drought while the war has forced thousands of families to flee their homes. Afghanistan is in dire need of money and the Taliban are unlikely to have access to the nearly $10 billion assets of the Afghan central bank. Until the Taliban get access to the central bank’s assets, they will have to make alternative mechanism to fulfill financial needs. The sources said that several of Kabul’s agreements with the international community are in danger because of lack of financial resources.
According to sources 500 megawatts of electricity is being supplied to Afghanistan from Uzbekistan and if the Taliban failed to pay as per the agreement, Uzbek government can suspend power supply. The Taliban have also seized all oil stocks in the country but the stock will have to be replenished. Iran will be ready to supply oil but the Taliban do not have enough revenue to continue purchase from the neighbouring country.
Just few months before the Taliban seized Afghanistan, the World Bank had presented a disturbing analysis of Afghanistan’s economy. After the Taliban control, the future of Afghanistan’s economy is now even in more uncertain situation. There are also fears that the Taliban will not be able to receive international financial support as the international community has not yet recognised the Taliban regime.
The Taliban have ordered banks to start operations, but there are restrictions on withdrawals and long queues outside banks. According to experts from the ratings agency Fitch Group, Afghanistan’s GDP is expected to decline by 9.7 percent this fiscal year and another 5.2 percent next year.