UNDP: Afghanistan’s Banking System Is in Turmoil
Immediate and decisive action is necessary, and delays in decision-making will increase the costs of the collapse of the banking system and create a bitter dilemma.
Afghan Voice Agency (AVA)_In a recent report, the United Nations Development Program (UNDP) said that Afghanistan’s financial system is in a and its banking system is in turmoil.
“Immediate and decisive action is necessary, and delays in decision-making will increase the costs of the collapse of the banking system and create a bitter dilemma,” said in a new report on the banking situation in Afghanistan on Monday, November 22.
In addition, the banking system in Afghanistan has almost stopped for three months now, and the problem has deepened in Afghanistan due to the liquidity crisis and the lack of confidence of investors and international markets, according to the report.
On the other hand, the International Monetary Fund (IMF) predicts a 30 per cent decline in the Afghan economy for the years 2021 to 2022.
According to the report, total bank deposits have fallen and declined from 268 billion afghanis equal to $2.9 billion at the end of 2020 to 194 billion afghanis equal to $2 billion in September this year.
However, by the end of 2021, the statistic is predicted to fall to 165 billion afghanis equal to $1.8 billion, showing about 40 per cent of the loss.
In the meantime, the economic activity is declining rapidly as the collapse of the # in Afghanistan intensifies, according to Abdallah -Dardari, UNDP program representative in Afghanistan.
“Without the banking sector, there is no humanitarian solution for Afghanistan,” he said.
If no serious action is taken to solve this challenge, the Afghan people will be isolated, he added.
Meanwhile, the warning of the turmoil in the country’s banking system has been proposed by the United Nations, while the recent developments in the country’s have been severely damaged and the liquidity crisis has increased due to economic problems.