KABUL (Pajhwok): Central bank chief Khalil Siddique on Tuesday told the Meshrano Jirga or upper house of parliament that the increase in US dollar’s value, the decline in investments and domestic products, insecurity, migration and capital flight were major reasons behind the depreciation of the afghani.
When new Afghan currency was printed in 2002, the afghani protected its value against the US dollar for a long time and at that time one dollar equaled 48 afghanis.
But during the last two years, the afghani experienced unprecedented decline and one dollar was accounted for 67.60 afghanis in Kabul open market on Tuesday.
According to Siddiqui, last year’s controversial presidential election caused a major setback to the country’s economic progress and worried most investors in Afghanistan.
He said the boom in US economy increased dollar’s value and insecurity in Afghanistan proved a major factor behind the country’s economic downfall.
He said the current currency crisis was mostly related to the increase in dollar’s value caused by the improvement in US economy and Afghanistan was not in a position to stop it.
The central bank chief said they had dollars to inject in the market and restore the afghani to its previous position, but the step would not be in the interest of Afghanistan and it would be a cosmetic rehabilitation of the currency.
He said people should not be worried about the current decline of the afghani, asserting that the central bank had $35 billion reserves.
Senate Chairman Fazal Hadi Muslimyar said the house was not satisfied by Da Afghanistan Bank chief’s explanation and referred the issue to the house complaints commission for necessary steps.
nh/ma
