AFGHANISTAN
II.1. GENERAL CONDITIONS
II.1.1. GROSS DOMESTIC PRODUCT (GDP)
The 1990 estimate of percentage of GDP contributed by sector was: agriculture 53%; industry 28.5%; services 18.5%. GDP per capita as purchasing power parity was $800 (2000 est., World Bank).
Seed-Related Evaluation: With the major economic activity being agriculture, general use of higher-yielding seed will have a significant impact on the national economy, as well as on the economic status of individual farm families. Higher crop yields should also stimulate rural economic development and creation of jobs, in handling/storing/ marketing/processing increased production-assuming that markets can be developed for any excess production above family needs. Despite the poor condition of roads, villagers reported that merchants/truckers (sometimes even from Pakistan) came to the villages and purchased their fruit. It is assumed that-as usual-the farmer received a price much below the selling price in the city markets.
II.1.2. LABOR FORCE
Labor force was estimated in 2000 as 10 million. This was employed by sector as agriculture 70%, industry 15%, services 15% (1990 est.).
The refugee situation, plus crippling injuries due to the conflict and land mines, has had an unknown effect on the labor force.
II.1.3. ECONOMIC OVERVIEW
GDP was estimated, as purchasing power parity, at $21 billion in 2000. In the recent conflict situation, this has deteriorated markedly.
"Afghanistan is an extremely poor, landlocked country, highly dependent on farming and livestock raising (sheep and goats). Economic considerations have played second fiddle to political and military upheavals during two decades of war, including the nearly 10-year Soviet military occupation (which ended 15 February 1989). During that conflict one-third of the population fled the country, with Pakistan and Iran sheltering a combined peak of more than 6 million refugees. In early 2000, 2 million Afghan refugees remained in Pakistan and about 1.4 million in Iran. Gross domestic product has fallen substantially over the past 20 years because of the loss of labor and capital and the disruption of trade and transport; severe drought added to the nation's difficulties in 1998-2000. The majority of the population continues to suffer from insufficient food, clothing, housing, and medical care. Inflation remains a serious problem throughout the country. International aid can deal with only a fraction of the humanitarian problem, let alone promote economic development. In 1999-2000, internal civil strife continued, hampering both domestic economic policies and international aid efforts. Numerical data are likely to be either unavailable or unreliable. Afghanistan was by far the largest producer of opium poppies in 2000, and narcotics trafficking is a major source of revenue." (CIA Afghanistan website, 2002).
Seed-Related Evaluation: current conditions require significant emergency assistance, and reliance largely on a localized informal seed supply system. This system could involve any available persons with seed experience and any existing facilities, but will require significant financial and technical assistance to enable it to move toward general self-sustainability.
II.1.4. RECENT AGRO-ECONOMIC CONDITIONS
An in-depth review by the World Bank summarized conditions as follows.
"Afghanistan's pre-war economy was mainly based on agriculture and animal husbandry. The country has a low population density due to difficult topographical and climatic conditions (high mountains covering most of the country, extremes of temperatures, and arid to semi-arid climate). In 1978-the last year of peace-Afghanistan was largely self-sufficient in food and was a significant exporter of agricultural products. Agriculture was largely concentrated in narrow river valleys and plains where irrigation water from snowmelt was available. Manufacturing industry was largely undeveloped, with only a few plants established (in textiles, medicines, cement, etc.) Afghanistan's strategic position during the Cold War period made it a large recipient of foreign aid, which funded the running of the state without substantial domestic taxation. Macro-economic policy was balanced, with budget surpluses, a market-based, competitive exchange rate and modest foreign and domestic debt. As a result of foreign aid, the country had a relatively good major road network, as well as some other infrastructure including major irrigation and hydroelectric facilities. This modern infrastructure, however, did not extend beyond the main arteries and urban centers. Social and other services (such as education and health) were largely limited to the relatively small urban sector.
"The long drawn-out war of Soviet occupation and subsequent internecine conflict severely damaged Afghanistan's economy. By the mid-1990's, most of the country's limited modern infrastructure was destroyed, and traditional irrigation systems greatly suffered from destruction and lack of maintenance. Even more important than the physical damage were the increasing breakdown of the state and civil society over time and the progressive erosion of institutions-both modern and traditional-which had governed the pre-war economy and society. Government-provided social services, which had never had a strong outreach into the rural areas, atrophied and to a large extent stopped functioning. NGO's and UN agencies have essentially taken up the task of providing essential social services to parts of the population, building on community-based efforts in various parts of the country. Inflation wiped out the value of the Afghan currency in the 1990's, and at present the currency is printed by the Northern Alliance without any monetary control. Agricultural output came down sharply, livestock herds were depleted, and large-scale industries almost ceased functioning. Millions of Afghans became refugees in neighboring Pakistan and Iran, and to a lesser extent elsewhere. This external population played an important role in supporting Afghanistan's economy through remittances. And finally, land and infrastructure were widely and indiscriminately sown with landmines, causing enormous human and economic losses.
" There was a modest economic recovery in the mid-1990's in areas that became largely free of conflict. Agricultural production increased; livestock herds sharply rose in numbers, taking advantage of widely available unutilized grazing lands; and horticultural production also grew based on restoration and expansion of orchards and vineyards. Substantial numbers of refugees returned to their homes with international assistance. The economic recovery was concentrated in areas taken over relatively early by the Taliban. However the deterioration in social services (particularly education) was aggravated by the Taliban's social policies, which largely excluded women from work and girls from school.
"The introduction of a certain degree of stability in large parts of the country also facilitated the growth of various kinds of unofficial economic activities, most notably long-distance trade (particularly re-exports to Pakistan) and opium poppy cultivation. Although these activities had always been present, they underwent unprecedented expansion in the 1990'. Unofficial exports to Pakistan are roughly estimated to have exceeded $2 billion in 1996, and by the late 1990's Afghanistan had become the largest producer of opium poppy in the world. Also falling in this category of economic activities in uncontrolled exploitation of natural resources-timber, gems, marble and granite, etc.-which have resulted in extensive deforestation and environmental degradation, among other problems.
"More recently, Afghanistan has been hit by a severe protracted drought, which started in 1999 and has lasted until the present. Given the breakdown of the state and civil society, and consequent inability to respond adequately, this drought has led to famine. Crop production has been halved and livestock herds heavily depleted, more than erasing the modest gains of the early and mid-1990's. Large and increasing numbers of people have lost their means of livelihood and have become displaced, either internally or to neighboring countries. Malnutrition has significantly worsened, and starvation deaths have been reported. The impact of the drought, which would have been serious under any circumstances, has been aggravated by the continuing conflict in parts of the country (particularly in northeastern and central Afghanistan) and by the rundown condition of irrigation systems and other agricultural infrastructure.
"Afghanistan's economic structure has been gravely weakened, distorted, and made more vulnerable through two decades of conflict. Agriculture (including livestock), the most important economic activity, is highly vulnerable to natural conditions as is demonstrated by the current drought. Trade activities are vulnerable to the policies of neighboring countries, most notably Pakistan-in fact, there appears to have been a substantial decline in Afghanistan's unofficial re-exports to Pakistan in the recent past, probably reflecting changing policies and stronger enforcement in Pakistan. Remittances, another major source of income, tend to be more stable, but nevertheless they are vulnerable to changes in economic conditions in the source countries. The Taliban's recent complete ban on opium poppy cultivation, which was a positive move and has been largely effective, has sharply reduced the incomes of those small farmers and rural wage laborers who were dependent on poppy cultivation and related work. Foreign aid, another important albeit smaller source of income, has increased sharply in the wake of the drought but also is subject to fluctuations and severe logistical constraints. The ongoing conflict has led to a transformation of social and economic networks. Although the majority of the territory of Afghanistan has not been constantly at war, economic distortions and vulnerabilities affect the entire country, and there is a pervasive sense of insecurity.
"Afghanistan's economic situation has significant regional spill-over effects-through unofficial trade, narcotics, terrorism and extremism, financial flows, and movements of people. These spillover effects tend to undermine revenue collection, governance and the effectiveness of economic policies in neighboring countries, particularly Pakistan. The long drawn-out conflict situation, without an effectively functioning state most of the time, has led to a situation where conflict-related or conflict-enabled economic activities and structures have become entrenched, and there are significant groups who are benefiting from the current situation and therefore have a vested interest in its continuation. (World Bank Afghanistan Approach Paper, 2001).