A consistent decline in the value of the Afghan currency against the U.S dollar has resulted in an almost 10 percent drop over the past two months.
In the past few weeks, the Afghani has fallen to a dismal 63.50 Afghanis to the US dollar – nearly a 6 Afghani drop in value since mid-June.
On June 13, the Afghani stood at 57.78 to the dollar. On Thursday it was at 63.50 to the dollar – showing an estimated drop of 10 percent in that period of time.
Insecurity, capital flight, absence of investments and the use of Pakistani and Iranian currencies in a number of Afghan provinces are to blame for the continuous decline in value, say experts.
Pakistani Rupees are reportedly being used for major business and trade transactions in the eastern and southern provinces of Afghanistan including Nangarhar, Kunar, Laghman, Nuristan, Kandahar, Helmand, Khost, Paktia, Paktika and Ghazni.
While, the Iranian Rial is being used in Afghanistan’s western parts, particularly in Herat, Nimroz and Farah.
However officials at the central bank of Afghanistan – Da Afghanistan Bank – admitted this week that Pakistani and Iranian currencies are being used in Afghan markets but announced a new plan was being drafted to stabilize the Afghan currency.
“The process needs time and the central bank is working in it” said Khalil Sediqi, head of Da Afghanistan Bank. “Those who call themselves Afghan must use Afghani.”
Despite a weekly injection of millions of dollars into Kabul’s exchange market over the past 14 years, Da Afghanistan Bank has still been unable to halt the decline of the Afghani.