- Home
- Sustainable Development Goals
- No Poverty
No Poverty
Two Years in Review: Changes in Afghan Economy, Households and Cross-cutting Sectors (August 2021 to August 2023)
The report is an evidence-based assessment of the economic and social situation in Afghanistan two years after the power shift in August 2021. The report shows that the Afghan economy and people are still in crisis with high levels of multidimensional deprivation low growth and urgent humanitarian needs. The report also highlights the impact of the crisis on women and girls who face severe restrictions on their rights and freedoms. The report calls for urgent action to address the humanitarian and basic needs of the Afghan people by stimulating economic recovery revitalising the financial sector and investing in community development and local economic resilience including women’s economic enterprises. The report aims to inform and influence the policy discourse and decision-making on the future of Afghanistan and to contribute to the efforts of building an increasingly stable prosperous and resilient nation.
Executive Summary
Two years following the power shift in August 2021 there are some positive — mixed with lingering negative signs — in Afghanistan’s society and economy. The country appears to have made good progress in maintaining stability and security - which is vital for the resumption of economic activity and pursuit of development. Similarly the efforts to curb corruption and combat opium production and illicit narcotics trade have yielded fruit creating an opportunity for joint national and international efforts to secure gains and build on the momentum.
Gender developments: Women disproportionately victimized by the changes
Since August 2021 different decrees have been put in place reducing the access of women and girls to education employment and daily public services. This has effectively reversed two decades of hard-won gains in gender equality. An indicative timeline of the additional measures is presented in the annex. The economic loss caused by these restrictions on female workforce was estimated to reach up to US$ 1 billion by end of 2022.
Subsistence insecurity index: An innovative approach to analyse extent and intensity of destitution
This study constructs an index called the Subsistence Insecurity Index (SII) to quantify the extent and degree of subsistence insecurity prevalent in Afghanistan following the Alkire-Foster (AF) method for the multidimensional poverty index (MPI). Using the MSNA2022–2023 data a set of 17 indicators are selected based on relevance to subsistence that cover the dimensions of health living conditions and livelihoods in order to identify whether or not a household is subsistence insecure (Table 1 Annexes) meaning whether the households have access to most basic items opportunities and services needed for mere subsistence-level living conditions.
Acknowledgements
This report is the second annual review after the regime change in Afghanistan prepared by the United Nations Development Programme Country Office Team in Afghanistan under the overall direction and guidance of Mr. Stephen Rodriques UNDP Resident Representative in Afghanistan.
Foreword
Two years following the power shift in August 2021 Afghanistan is at a delicate crossroad. On the one hand there appears to have been progress in maintaining stability improving security anti-corruption efforts and combating opium production and illicit trade. On the other hand it continues to experience a multi-faceted crisis where the economy is bottoming out of a cumulative 27 percent contraction since 2020 and nearly 7 out of 10 Afghans lack access to the most basic items opportunities and services needed for subsistence-level living conditions.
Conclusion
Productive sectors that fuel overall economic activity—such as agriculture and private enterprises—are not recovering unless supported at a pace needed to improve the socio-economic conditions of the population. Afghanistan’s GDP experienced a 27 percent cumulative decline with non-agriculture sectors accounting for greater shares of the shrinkage while per capita income dropped from US$512 in 2020 to US$352 in 2022—a 31.2 percent decline in current US dollar terms. The severe drought and adverse climate events also contributed to the worsening of the overall economic situation.
Introduction
The date 15 August 2021 marked a pivotal moment in Afghanistan’s history as the Taliban took control of the country as the de facto authorities (DFAs). The sudden cessation of international aid and grants which had accounted for 40 percent of the country’s Gross Domestic Product (GDP) along with a freeze on international reserves amounting to about US$9 billion and the imposition of international sanctions triggered a severe balance of payments banking and payment systems crisis. The inability of the de facto Central Bank of Afghanistan (DAB) to easily print banknotes and access US$7 billion of foreign reserves continues to severely limit the execution of the central banking key functions.
Households: The real victims of the crises
The households (HHs) in Afghanistan have been subjected to major socio-economic transformations between 2021 and 2023. This period has witnessed a confluence of political economic social and environmental factors that have had a significant negative impact on the lives of Afghan families. Because of the international assistance that has been pouring in since late 2021 the households report some improvements in their income and expenditure and overall living conditions in 2023 compared to 2022 although these improvements remain very fragile as international assistance declines.
Introduction and background
It goes without saying that the future is important to humans whether that is in their personal capacity the way they conduct business or how they govern themselves. The future is however neither predictable nor predetermined. This implies one can make decisions in the present to shape the future in line with our values. Therefore it is important to “experience” the future through future thinking and foresight and use that experience to mould strategies today to take us to a preferred future. Foresight enables us to do just that. Foresight is a process of systematically envisioning the long-term future of science technology the economy and society. It is aimed at determining what the future may bring and identify areas of strategic R&D and technology likely to yield the greatest economic and social benefits. Whereas the future does not yet exist we can nonetheless shape it through actions taken in the present with the help of foresight as a strategic planning tool.
Main findings and way forward
This chapter spells out the main findings of the foresight exercise and provides guidelines for further action. The STI foresight exercise done in Botswana as part of the STI Policy (STIP) Review was the first ever STI foresight initiative in the country and aimed to identify future national priorities for STI (see STIP Review section 3.5). It achieved its objective of creating a platform where stakeholders including government parastatals higher education and business could build awareness as a joint community for discussion about the future of STI in the country. The foresight exercise yielded a common view of STI activity required for a thriving future and conversations were initiated about the future of STI acknowledging social development and economic needs. An overview was achieved on the role of the NSI as an STI ecosystem to ensure a thriving future for Botswana. At the same time a decision support base was created for government to fund STI in the future by identifying priority STI domains and thrusts. A view of a joint way forward for government and business was created with both parties agreeing that close collaboration and joint initiatives will be required for a successful STI future. Emphasis was placed on the critical importance of forming the young minds of the future that will take the country forward thereby alerting the Higher Education Institutions (HEIs) government ministries and relevant agencies as well as business to focus on preparing STI practitioners for the future of work. These achievements were possible in the short time the foresight exercise was conducted by using Vision 2036 as the major driver of the country into the future.
Botswana Science, Technology, and Innovation Foresight
This report was prepared as part of the Botswana Science Technology and Innovation (STI) Policy review process and should be read in conjunction with the Botswana STI Policy Review. It documents the STI Foresight exercise designed and undertaken by UNCTAD in 2022 to explore the future role of science technology and innovation and STI policy in Botswana and to stimulate a process aimed at creating a consensus on the future priorities for national investments in R&D technology and innovation. It responds to a key finding of UNCTAD's Botswana STI Policy Review that the lack of clearly defined national priorities contributes to fragmentation in the national system of innovation in Botswana and undermines its innovation performance and capacity for technology upgrading. These in turn constrain the ability of Botswana to use STI for sustainable development and reach the sustainable development goals. The STI foresight exercise aimed to provide a future dimension to strategic planning for STI in the country. It sought to involve the STI community of policymakers and practitioners in Botswana in a discussion about what the STI future could be for Botswana and what a preferred STI future is for the country. The exercise and the report are based on an understanding that foresight can help to shape the future of Botswana by looking forward into the future to see what could be possible through selective policy interventions undertaken in the present starting from today.
Preface
The United Nations Conference on Trade and Development conducted a Science Technology and Innovation (STI) Policy Review of the Republic of Botswana during 2021-22. As part of the STI Policy Review a foresight exercise was undertaken to initiate a process of identifying future national priorities for STI in Botswana and discussing the future role of STI in development in Botswana with stakeholders in the country.