Opinion: Amid its brutal economic crisis, Afghanistan’s middle class has collapsed into poverty

Hikmat Noori is an Afghan journalist who reports on conflict, politics, development and culture in Afghanistan.

A year ago, Mohammad Rashid Anwari, 39, had it all: a successful business, a growing family and resources that allowed him to be a pillar of support for his community in Kabul thanks to his charity work.

But when the Afghan government collapsed last August, as the Taliban tried to take control of the country, Mr Anwari also saw his family’s life crumble. As foreign businesses and investment retreated from the country, his business – which supplied international and local non-governmental organizations – struggled to stay afloat before his business partner took what was left and fled the country.

“I lost everything when the Taliban took control of Kabul,” he told me. “Overnight, I became a beggar.” He told me that his family is one small crisis away from absolute poverty.

“We can no longer afford rent, utilities, school fees, books and clothes for the children,” said his wife, Nazanin Anwari, 37. to the charity of others. We raised our children with some comfort, but now we can’t even afford to meet their basic needs. It’s not fair to them, they didn’t do anything to deserve it.

The Anwari are not alone. Afghanistan’s extreme poverty is perhaps most visible in the crowds that stand outside bakeries, hoping to grab a piece of bread bought by a charitable passerby. But events since the Taliban takeover have forced members of the former middle class – the success story of the US-led coalition invasion – to compete for scraps with Afghans as well. already poor, who are now even worse off than before.

The country is plunged into an economic crisis. When Washington froze the assets of Afghanistan’s central bank and nongovernmental organizations pulled out, the country’s institutions and systems collapsed, making it difficult to import and export needed goods. International sanctions against the Taliban have only contributed further to the financial instability of families; inflation and unemployment rose.

For years before the takeover, a small but prosperous middle class had grown on the strength of Afghanistan’s private sector. Largely supported by foreign aid, the private sector has grown steadily for two decades and has been hailed as a success story. Despite insecurities, political instability, COVID-19 and other challenges, it was even expected at one point to contribute to small economic recoveries when the pandemic subsides.

But that was before the Taliban took over. According a World Bank report, the private sector has experienced a significant decline in business operations, market demands and employment. At least one in three businesses have at least temporarily ceased operations. The rest have engaged in severe downsizing, scaled back operations or even taken out loans from informal and unregulated institutions. Needless to say, women-led businesses have been among the hardest hit, with over 40% forced to close and 83% facing revenue losses.

According to the International Labor Organization, employment in Afghanistan fell by more than half a million workers – 8% of the labor force – in the first three months after the Taliban took over. Again, it was worse for female workers, with a 16% drop in employment largely attributed to “newly imposed restrictions on women’s economic participation”.

With all these crises, it is not surprising that people’s purchasing power has dropped significantly. Nearly 82% of businesses surveyed by the World Bank reported a “drastic decline” in consumer demand, forcing them to further scale back operations and creating a vicious cycle of unemployment and poverty.

Despite their lack of governance vision and experience, the Taliban seem to realize the importance of a strong private sector. While the group’s return to power has reversed years of economic dynamism, it is now working to attract international investment. But through its fundamentalist policies – some of which are actively damaging the overall health of the economy – the sanctions-riddled pariah group has shown itself unwilling to abide by international humanitarian laws and values. Their efforts are therefore unlikely to result in the stability needed to rebuild the country’s middle class anytime soon.

So valuable employers in the Afghan economy, such as the Anwaris, are struggling to make ends meet and keep their entrepreneurial spirit alive. For his part, Mr. Anwari moves around the city in search of a job as a qualified electrician. “Nobody is hiring, otherwise I’m a very good electrician,” he said. “But the fact is that ordinary Afghans can no longer afford to repair their homes.”

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