[{"bbox": [143, 148, 1086, 475], "category": "Text", "text": "is carefully monitored by the IMF through the USD 45 Million three-year Extended Credit Facility (ECF) approved on 20 July 2016 by the IMF Executive Board with 2 positive reviews in May and December 2017; for which all quantitative performance criteria and indicative targets were met. Prudent monetary and fiscal policy succeeded in controlling inflation and depreciation, mainly vs USD. The fiscal stance has been broadly consistent with the agreed IMF ECF framework. The FY 1396/2017 budget represented the first year of implementation of the five year Afghanistan National Peace and Development Framework (ANPDF) and the national budget for the FY1397/2018 has been approved mid-January 2018. Despite its limited fiscal space, it is becoming more responsive to ANPDF and NPP priorities while putting a focus on reforms towards increased self-reliance."}, {"bbox": [143, 481, 1086, 677], "category": "Text", "text": "The ANPDF stipulates the Government's objective of growing domestic revenue by up to 12 percent annually, with the overarching goal of having domestic revenues account for 14 percent of the GDP by 2020. Reforms implemented in the course of 2016 and 2017 suggest that the Government is progressing towards their self-set objective. Sustained rapid revenue growth in coming years will only be possible with stronger economic revival and more effective revenue measures that widen and deepen the tax base."}, {"bbox": [143, 681, 1086, 1076], "category": "Text", "text": "However, the Afghan economy continues to be affected by on-going conflict and political instability. After rapid growth for more than a decade (9.4% for the period 2003-2012), real GDP growth slowed to 2.1 % in the period 2013-2016, following the departure of most NATO troops at the end of 2014, compounded with reduced aid and weak investor confidence. Growth in 2016 increased to 2.2%, up from 1.1% in 2015, principally due to strong growth of the agriculture sector. For 2017, World Bank (WB) projections suggest GDP growth of 2.6%. With an average annual population growth rate of at the most positive projection 3% and an estimated 400.000 Afghans entering the labour market each year, demographic pressures are mounting, resulting in turn in a declining GDP per capita from USD 633 in 2014 to USD 590 in 2016 and USD 607 in 2017. As a result of the reduced economic growth and the deteriorating security situation the poverty rate increased to 39.1% in 2013-14 up from 36% in 2011-2012. Preliminary figures for 2016-2017 suggest a further detrimental poverty rate increase."}, {"bbox": [143, 1080, 1086, 1475], "category": "Text", "text": "Macroeconomic stabilization policies continue to be seen as overall conducive towards investments in extractives, agri-business and connectivity/logistics, which are considered the three key areas for Afghan economic development and growth. The economic potential in commodity sectors can be compounded by the service sectors that can develop around them. For this to happen, the pre-conditions are: (i) an improvement in the business environment as outlined in the World Bank's Ease of Doing Business Index²² and (ii) continued reforms, macroeconomic stability and manageable debt. But this can only be attained if political leaders adopt significantly more growth-focused political and economic reforms, for which the set-up of the inter-ministerial executive committee on private sector development (PriSec) in 2017 confirms the Government's commitment. But awaiting the implementation of actual reforms, prospects of economic recovery in the short-term are judged to be dim. Also, the current resource envelope is inadequate to fully finance the Government's investment ambitions as"}, {"bbox": [143, 1542, 933, 1566], "category": "Footnote", "text": "²² As of 2017, Afghanistan ranks 183th country of 190 on the World Bank Ease of Doing Business Index."}, {"bbox": [599, 1606, 636, 1629], "category": "Page-footer", "text": "[12]"}]