IMF Unlocks Aid as Afghan Govt. Pledges Reform
Kabul – The Afghan government has welcomed the IMF’s move to reopen credit lines to Afghanistan two years after corruption fears surrounding the Kabul Bank crisis had stopped most funds being sent. Ministry of Finance officials said the International Monetary Fund’s restored aid will encourage other donors to give to Afghanistan.
“We are not concerned about the amount of aid, what is important is that the [renewed] aid will encourage others to help Afghanistan,” Finance Ministry adviser Najibullah Manili told TOLOnews Tuesday. The IMF on Monday released a statement saying it had reached an agreement with Afghanistan on what reforms were needed for the country to receive the next aid installment.
It granted Afghanistan a US$133.6 million line of credit in November 2011 but to date has only disbursed two installments of about US$18 million each. The statement comes after a two-week IMF visit during which Afghan authorities agreed on key certain conditions for the release of funds, including a tightening of monetary policy, the implementation of key structural benchmarks for submission of laws to parliament and strengthening banks’ capital, according to the IMF statement.
Afghan authorities also agreed on implementing a value-added tax (VAT) in 2014 and increasing revenues by strengthening customs measures, the IMF said. Indicating that growth and inflation were better than expected in 2012, the IMF said “the economic outlook for Afghanistan is broadly positive”. (Tolonews)