Afghanistan - International trade



The Soviet invasion in 1979 damaged Afghanistan's industrial and agricultural sectors significantly, and as a result the country's exports, of which gas was very important, diminished. This shift naturally meant that the import bill had to rise to provide the Afghan people with basic commodities such as food and petroleum products and most consumer goods . Rising imports during the 1980s resulted in a serious trade deficit , although accurate figures are impossible to estimate, since official statistics exclude most illegal trade. From 1985 to 1986 and from 1989 to 1990 the value of exports fell almost 50 percent from US$566.8 million to US$235.9 million, with declining natural gas exports accounting for much of the difference. Other crucial earners of foreign exchange included the sale of nuts and vegetables to Pakistan and India and sheepskins to Europe. Imports declined somewhat during the 1980s as Afghanistan and the Soviet Union became more and more integrated. Between 1989 and 1991, the USSR was consuming 72 percent of Afghanistan's exports and supplying it with 57 percent of its imports. Despite the difficulties in determining trade figures, the CIA World Factbook estimated imports of

Trade (expressed in billions of US$): Afghanistan
Exports Imports
1975 .217 .350
1975 .217 .350
1975 .217 .350
1980 .670 .841
1985 .567 1.194
1990 .235 .936
1995 .026 .050
1998 N/A N/A
SOURCE: International Monetary Fund. International Financial Statistics Yearbook 1999.

US$150 million in 1996 and exports of US$80 million, not including opium.

When the Soviet Union collapsed in 1991 and the communist government simultaneously fell in Kabul, most imports started to flood in from Pakistan. Under the Afghan Transit Trade (ATT) agreement, signed in 1965, Pakistan allows Afghanistan to have access to the sea and to engage in commerce with the international community to the extent required by Afghanistan's economy. Most of the goods imported under the ATT are reportedly electronics and other consumer items, which cross Pakistan's territory free of duty .

Since the Taliban's rise to power, trade has increased significantly with Pakistan, but most of it is not officially recorded. Trade between these 2 countries involves the importation of fuel, wheat, and cement and had included the export of opium. There has been an increase in the volume of trade between Afghanistan and Turkmenistan since 1998. In September 1998, the Taliban authorities signed an agreement with the government of Turkmenistan to begin importing gasoline, diesel, and jet fuel. This action has, to some extent, reduced Afghanistan's dependency on fuel imports from Iran. According to a World Bank report, the total trade between Afghanistan and Pakistan was estimated to be US$2.5 billion in 1996-97, of which US$1.96 billion was estimated to be the value of re-exported goods from Afghanistan into Pakistan.

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