DAB’s initiative praiseworthy as national currency’s value rises
Following a series of measures, adopted by the country’s central bank – Da Afghanistan Bank (DAB), to inject millions of U.S. dollars in the market, the value of Afghanis recently appreciated by 5.5 percent against foreign currencies. Moneychangers in the country’s capital markets said they have now been changing a U.S. dollar against 85.23 Afghanis, while the price had been counted over 90 Afghanis a few weeks ago. The value of Afghani didn’t further decline after the initiation of the country’s central bank (DAB), as the moneychangers’ union said there was a growing demand for the local currency in the market and this is why the local currency’s value against U.S. dollar has risen. On the other hand, there are more dollars coming as remittances and some organizations offer dollars and take Afghanis from the market as well as Afghans living abroad send dollars to their relatives inside the country that helped the value of the local currency rise or at least remain stable. After the resumption of power by the Islamic Emirate in mid-August 2021, billions of U.S. dollars in Afghanistan assets were blocked, causing critical inflation in the country’s national currency, the Afghani, and the rise of foreign currencies, especially the U.S. dollar. The inflation also helped an eye-catching rise in the food items’ prices that deteriorated the poverty-battered Afghans’ economic condition. The U.S. move to freeze the country’s national currency, forced Afghan traders to suffer heavy losses and the people face skyrocketing rises in prices. But the country’s central bank initiated to auction billions of U.S. dollars step by step in the market to protect the stability of the national currency and prevent further price rises in the country. As Eid al-Fitr is due to arrive, people are storming to the markets to buy their essentials to celebrate the religious festivity, considering their local traditions. So they are now very happy for the stability of the Afghani after the intervention of Da Afghanistan Bank (DAB) to frequently inject dollars in the market. There are also other factors behind still decline in the Afghani value; which could be enumerated as further strengthening of trade relations between Afghanistan and foreign investors, reopening of other foreign countries diplomatic missions in Afghanistan and finally recognition of the Islamic Emirate by the international community. A number of regional and neighboring countries have already reopened their diplomatic missions in Kabul, while many others pledged for their diplomatic mission resumption in the country. Also, the related organs of the Islamic Emirate should do their best to provide job opportunities for thousands of eligible people, particularly educated and experienced people, as part of the government’s plan to prevent brain drain on one hand and help the level of demand for Afghani grow and the price of Afghani rise on the other. Likewise, there is a need for the people to use domestic products and the national traders to deal all their transactions and affairs in local currency to rise its value and protect its stability.