Afghanistan Chamber of Commerce and Industries (ACCI) said Friday that foreign investment in the country sharply dropped – to its lowest level since the start of new solar year, warning of an economic recession if government does not take firm steps to tackle the decline.
According to ACCI, a surge in violence across the country and government’s failure for providing fresh incentives to foreign investors have also affected domestic investments.
“There has not been any foreign investment in the country this year, no one is prepared to invest amid the fragile security situation, even our domestic investors are faced with numerous problems right now and they are not willing to continue,” deputy head of ACCI, Khan Jan Alokozai said.
Meanwhile, Afghanistan Investment Supporting Agency (AISA) has said that investments dropped by 26 percent this year.
The lack of safety and proper security arrangements for investments and investors, absence of investment supporting strategies, a lack of incentives for investors to encourage investors for investment and a lack of clear economic and investment vision for attracting medium and major investments have been the main aspects of decline in investments in country.
The ACCI and AISA have warned that if the government doesn’t come up with strategic economic reforms to boost the economy and attract foreign investments, the country may collapse into a financial recession.
“Problems exist and we are all aware of that, but right now it is difficult to say that foreign investment has been zero, but I can confirm that investments dropped by 26 percent overall and this is a matter of concen,” deputy head of AISA Ibrahim Shams said.
Economic experts have said that uncertainty on the political and economic climate of the country and the fragile security situation have discouraged foreign investors.