In a positive turn of events, Afghanistan’s food security landscape has witnessed a notable improvement in the second quarter of 2023. The highlight of this period has been the consistent decline in both headline figures and food inflation rates.
From January to June 2023, food inflation registered a remarkable decrease, plummeting from 3.2 percent to an impressive -11.2 percent. This substantial downturn can be attributed to a confluence of factors, including the reduction of global and domestic prices for crucial food commodities, as well as the sustained stability of the Afghani (AFN) over the past year. Noteworthy regulatory interventions in March 2023 resulted in substantial cuts to import tariffs for essential food items, further contributing to this positive trend.
A notable achievement has been the steadfast stability of the Afghani against the US dollar (USD) since January 2022. This resilience can be traced to a series of measures implemented between January and March 2022. These encompassed United Nations-backed cash infusions and stringent controls by the de facto authorities on illicit foreign currency exports. The net effect has been a commendable 0.4 percent appreciation of the AFN, culminating in an exchange rate of 85.8 against the US dollar as of July 24, 2023, marking a notable increase from its valuation on August 15, 2021.
