A Very Bleak Future For Afghanistan

Afghanistan has a population of 38 million. About 4.5 million people (12% of the country) live in the capital Kabul, which is located in the east of the country. Other major provinces include Herat (1.9 million), Nangarhar (1.5 million), Balkh (1.3 million) and Kandahar (1.2 million). The Central Asian country is among the top 40 most populated countries in the world. At 652,860sq km (252,071 sq miles), the country is roughly the size of the US state of Texas and more than twice the size of the UK. It is the eighth most mountainous country in the world making many parts difficult to access. The country’s capital Kabul reaches a mean elevation of just more than 2km (6,562 feet) above sea level. The Hindu Kush mountain range spans the northeast of the country, while the southwest is mainly covered in desert. Afghanistan is the biggest producer of opium in the world. Most of the opium poppy, used to produce the highly addictive heroin drug, is grown in the southwest of the country. In 2020, 224,000 hectares (about 553,500 acres) of land was used to cultivate opium poppy across the country. More than half of all poppy cultivation—115,597 hectare (285,650 acres)—was cultivated in the southwestern province of Helmand alone. According to UN estimates, ​​about 6,300 tonnes of opium, with a value of $350m, was produced in 2020. Before the COVID-19 pandemic, at least 54.5% of the country lived below the poverty line, with current estimates reaching up to 72%. Literacy rates in Afghanistan are among the lowest in the world at 43%. Just over half of all males above the age of 15 can read and write, while the ratio is much lower among females—less than one-third. At least 389,645 people, of which 59% are children, were displaced within Afghanistan from January 1 to July 24, 2021. In June alone, 109,000 people were internally displaced within the country. Three quarters of the displaced people came from 10 of Afghanistan’s 34 provinces: Kunduz (92,000), Nangarhar (38,000), Takhar (25,000), Kandahar (24,000), Faryab: (20,000), Kunar: (19,500), Wardak: (19,000), Daykundi (18,300), Laghman (18,000), and Helmand (17,000). The highest internal flows within the same province occurred in Kunduz (85,000), Nangarhar (38,000) and Takhar (25,000). The total number of Afghan refugees globally in 2020 reached 2.6 million. Almost 86% of those registered refugees are in three of the neighbouring countries, with an additional 12% living in Europe.

By August 12, 2021, the Taliban had encircled Kabul and began negotiating for a peaceful handover of the capital city. The armed group had by then captured 26 provincial capitals, including the cities of Mazar-e-Sharif, Jalalabad, Khost, Sar-e-Pul, Sheberghan, Aybak, Kunduz, Taluqan, Pul-e-Khumri, Farah, Zaranj, Faizabad, Ghazni, Herat, Kandahar, Lashkar Gah, Feruz Koh, Qala-e Naw, Pul-e-Alam, Terenkot and Qalat. The Taliban had already gained vast parts of rural Afghanistan since launching a series of offensives in May 2021 to coincide with the start of the final withdrawal of foreign forces.

Will the Taliban be able to prove itself to be the dominant unifying force in Afghanistan instead of repeating the brutal infighting after the seizure of power back in 1996? Or will Afghanistan inevitably sink into the quagmire of tribal, sectarian, ethnic and other disputes? As long as land-locked Afghanistan is full of betrayals, conspiracies, civil wars in the same house, its ‘popular’ politicians will tend to turn back and forth. Consequently, even if the Taliban can offer short-term stability, in terms of economic issues alone, the Taliban will soon feel the severe economic pressure, and the day their trophies are exhausted will be theirs. The principal reason why Afghanistan had remained unstable for the past 200 years is its landlocked territorial nature, which had forced it (ever since its founding in 1747) to be accorded the status of a ‘predatory state’ that periodically launched wars of aggression for the sake of plundering India, and using spoils to create temporary bonded tribal alliances. More than three-quarters of its revenues at that time came from looting India. However, this way of living could not be sustained beyond 100 years.

People regard food, clothing and shelter as their existential imperatives. Presently, the food scarcity is the first to create the greatest negative impact in Afghanistan. The eve of the Taliban’s invasion of Kabul coincided with the latest report released by the United Nations World Food Programme, predicting that by the end of this year, 270.5 million people in 80 countries will face food shortages, 41 million people in 43 countries will be on the verge of hunger, and Afghanistan will suffer from severe food shortages. Afghanistan topped the list, surpassing the Democratic Republic of the Congo, Ethiopia, Haiti, Nigeria, South Sudan, Sudan, Syria, Venezuela and Yemen. The food shortages are a long-term chronic illness of Afghanistan’s economy and peoples’ livelihoods. There is no hope of any solution in the future. Afghanistan’s land is barren and arable land accounts for a small proportion. In ancient times, epidemics and wars barely achieved a balance of food supply-and-demand. When modern medicine was introduced to significantly reduce its mortality rate, it didn’t take long before the domestic food production could not keep up with population growth. In 1946, the poor agricultural harvest in Afghanistan led to the first time in its history to import food. Domestic prices soared and the inflation rate reached 30.5%. The history of Afghanistan's increasing dependence on imported food began.

From 1950 till today, the population of Afghanistan has expanded from 11.83 million to an estimated 32.2 million as per the population data of Afghanistan’s Central Bureau of Statistics in 2020), but the combined grain output of wheat, barley, corn, and rice (which had reached its peak of 4.584 million tonnes in 1976) has been in steady decline. In 1987, it fell to 1.279 million tonnes, which was only 48% of the output in 1954 (2.677 million tonnes). It was only 2.52 million tonnes in 1993 on the eve of the rise of the Taliban. Afterwards, it stagnated for many years. After the US military defeated the Taliban regime and the establishment of the Islamic Republic of Afghanistan government in 2001, the relatively stable environment and super-strength international assistance promoted a marked rebound in Afghanistan’s food production. Its food production in the 2018 was only 4.124 million tonnes, equivalent to 90% of its peak production in 1976. As a result, Afghanistan’s per capita food production reached 215kg in 1954, peaked at 288kg in 1978, and fell to 142kg in 1993. After the fall of the Taliban regime in 2001, during the government of the Islamic Republic of Afghanistan, its infant mortality rate was reduced by about 50%, while population growth nearly doubled, causing its per capita food production to further drop to about 128kg. The gap between food demand and domestic food production has been widening since then.

During the 20 years of the Islamic Republic of Afghanistan’s government rule, the food shortages were mainly resolved by international aid, and most of the international aid came from the US, Europe and India. Now, the situation facing Afghanistan is that the uncertain risk of domestic food production that has risen sharply due to the regime change. Since last year, food prices in the international market and the domestic market of developing countries have soared, while existing international aid has been substantially reduced, especially in the US, Europe, and India. Aid may not be restored in the foreseeable future. Pakistan and some Gulf Cooperation Council member-countries may provide partial assistance, but it is difficult to expect them to fill all the gaps in aid cut off by the US, Europe and India.

In the US, the average price of soft red winter wheat in 2019 and 2020 will be US$211.3/tonne and US$227.7/tonne, respectively. The average price from the third quarter of 2020 to the first quarter of this year will be US$213.8/tonne, US$248.1/tonne and US$275.2/tonne, respectively. The price from February to May this year was US$276.6/tonne, US$272.6/tonne, US$281.4/tonne and US$271/tonne. The food price index in the World Bank's low- and middle-income countries commodity price index (2010=100) will be 87.0 and 92.5 for the whole year of 2019 and 2020, respectively. The averages from the third quarter of 2020 to the first quarter of this year are 91.0, 101.7 and 114.2, respectively. , From February to May this year, it was 115.2, 113.8, 117.9 and 126.0 in turn. In March 2020, the then US Secretary of State Mike Pompeo tried to coordinate the relationship between Afghan President Ghani and CEO Abdullah, but to no avail. He announced a reduction of US$1 billion in aid to Afghanistan that year and also continued a reduction of US$1 billion in 2021. This time, when the Taliban have seized power, the US and Europe have no hope of resuming aid to Afghanistan in the foreseeable future. India’s aid to Afghanistan totals about US$3 billion, but this too has now been terminated.

In the field of non-agricultural industries, the development environment that Afghanistan faces after the regime change is also severe. The construction industry has been one of Afghanistan’s industries with the largest growth in the past 20 years, which has led to the development of metallurgical and other related industries. However, most of the demand for the construction industry in Afghanistan comes from international aid investment. These industries will most likely come to a standstill after the regime change. Even if some are hoping for the mineral resources of Afghanistan to be commnercially exploited, it will take at least a decade for the required road/rail transportation networks to be built for the sake of ferrying the exploited minerals. And given the sky-high transportation costs, people should not expect too much. Yes, most of Afghanistan’s proven reserves of natural gas, coal, salt, chromium, iron, copper, mica, emeralds, lithium and other mineral resources are not large. For example, its coal reserves are only 73 million tonnes, which is not enough to sustain 32.2 million Afghans. The country’s copper resources are relatively rich, and the iron ore resources may be relatively large. The Aynak copper mine south of Kabul has a total proven ore reserves of about 700 million tonnes and a total copper metal volume of 11.33 million tonnes. It may be the world’s third largest copper ore belt. Afghanistan may also have the fifth largest iron ore vein in the world, but even if the total amount of these minerals reaches the level of optimistic estimates, is it enough to pull the overall economic and social development of Afghanistan out of the quagmire? Look at the large-scale development of Zambia and others. It is not difficult to make an objective and rational judgment in a large copper mining country. International relations have also created huge obstacles to the development of mineral resources in Afghanistan. There are certain oil and natural gas resources in northern Afghanistan. With the help of the USSR, its natural gas fields were put into production in 1967, and the output reached 2.635 billion cubic metres in 1971, becoming the main export commodity. However, in the wars since the late 1970s, its natural gas production has plummeted. Moreover, the natural gas export pipeline in northern Afghanistan leads to Central Asian countries, and the relationship between the Taliban and Central Asian countries is generally quite bad. If it is exported to Pakistan or even India, its sales revenues are not expected to recover the investment in new oil and gas pipelines due to insufficient production. As for the Central Asia-Afghanistan-Pakistan-India oil and gas pipeline concept that has been hyped in the so-called ‘Caspian Oil Game’ since the 1990s, it has already encountered bloodshed. Looking at it from a broader background, claims that Afghanistan is a ‘civilised crossroads’ and how important it is to China’s ‘Belt and Road Initiative’ are just illusions behind closed doors. In fact, since the great geographical discovery at the end of the 15th century led to the great shift in international seaborne trade routes, Afghanistan has been completely marginalised in the international trading system. The increasingly closed, regressive, and accelerated tribalisation of Afghan society is largely due to this. The development of modern rail/air/sea transportation technologies has not changed the trend of Afghanistan’s marginalisation in the international trading system. On the contrary, it is exacerbating this trend to a considerable extent. Therefore, in terms of economic significance, Afghanistan is insignificant to the ‘Belt and Road Initiative’.

China has had good relations with the government of the Islamic Republic of Afghanistan established after the fall of the Taliban regime in 2001. In December 2001, Beijing sent a working team to participate in the establishment ceremony of the Afghan interim government, re-opened the embassy in Afghanistan, which had been closed for eight years, and provided US$ in cash as a government startup fund, plus 30 million Yuan in emergency supplies. During President Ashraf Ghani’s visit to China in 2014, China announced that it would provide 500 million Yuan in free aid to Afghanistan in 2014 and another 1.5 billion Yuan in free aid from 2015 to 2017. For reconstruction activities, China has assisted in the construction of a number of livelihood projects such as the Parwang Water Conservancy Rehabilitation Project and the Kabul Republic Hospital, and has trained more than 2,000 professional and technical personnel in various fields for Afghanistan through bilateral and multilateral channels. In 2020, while the bilateral trade volume between China and Arab states was US$550 million, a year-on-year decrease of 11.7%; the value of Chinese companies’ new projects in Afghanistan was US$110 million, a year-on-year increase of 158.7%; the completed turnover was US$34.25 million, a year-on-year decrease of 62.3%. . After the regime change, a considerable part of the above-mentioned engineering projects may be unfinished. Many of the professional and technical personnel trained by China for Afghanistan are expected to flee overseas. In the short term, if payment and security are guaranteed, the Afghan market will be actively and steadily supplied by China with consumer goods for civilian use. However, fixed-asset investment projects, especially large-scale investments, will definitely get delayed.