Central & South Asia

Without Free and Fair Elections, Afghanistan’s Economy Will Not Recover

Consecutive Afghan governments appear to disregard the importance of free and fair elections and political stability for bringing investment into the country and stimulating economic growth.
Afghanistan news, Afghanistan election news, Afghanistan election violence, Afghanistan election 2019, Taliban news, Afghanistan security news, Afghanistan economy, Afghanistan economic growth, Afghanistan political instability, Ashraf Ghani news

Kabul, Afghanistan, 09/24/2019 © hazartaha / Shutterstock

September 25, 2019 16:08 EDT

Afghanistan’s presidential election, scheduled for September 28, will hopefully bring the 9.6 million registered voters to the polling stations, 35% of them women. The election is essentially a rematch between the current president, Ashraf Ghani, and his chief executive, Abdullah Abdullah, plus 15 more contenders.

The election process faces many challenges. In terms of security, the Taliban has increased its presence across the country, especially in rural areas. Over 70,000 security forces are assigned to protect 5,000 voting stations. In Ghazni, in the southeast of the country, where the Taliban launched massive attacks concurrently in recent years, only some districts would be safe enough to open polling centers. In the Taliban western stronghold, in Farah province, where only 600,000 registered to vote in the October 2018 parliamentary election, it is now believed that as few as 10,000 would come out on election day. The Independent Election Commission (IEC) announced last month that some 2,000 of the 7,366 potential polling centers nationwide will remain closed due to safety concerns.

Economic Woes

Both the previous and current Afghan governments appear to disregard the importance of free and fair elections and political stability for bringing investment into the country and stimulating economic growth. A recent report by the World Bank shows that Afghanistan’s economic growth was slow, at just 2% in 2018, despite positive improvements in economic policies, leading to a rise in poverty and deterioration in living standards across the country. The reports points to conflict, drought and political uncertainty as the main factors negatively impacting economic growth, the slowest in the South Asia region. Another report, by the National Risk and Vulnerability Assessment survey, shows the poverty rate has increased from 38% in 2011-12 to 55% in 2016-17.  

The Afghan National Unity Government (NUG) had stepped in and tried to turn the economy around. For example, according to the World Bank, during 2017, the cost of starting a business reduced significantly, from 82.3% of income per capita to only 6.4%. The time needed by businesses to pay their taxes in 2017 was reduced to 270 hours, down from the regional average of 275 hours. In 2018, on the heels of the reforms around obtaining credit, protecting minority investors, paying taxes and resolving insolvency, Afghanistan has improved its ranking from 183 to 167 in terms of ease of doing business.

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In 2018, regional projects like the Turkmenistan-Afghanistan-Pakistan-India (TAPI) pipe line, which will transfer gas from Turkmenistan through Afghanistan to Pakistan and India, and the Lapis Lazuli corridor that will create jobs and increase regional connectivity as part of the old Silk Road route, were inaugurated. Confidence was gradually restored, and the economy picked up momentum. Real GDP growth went up from a low of 1.5% in 2015 to 2.3% in 2016, reaching 2.7% in 2017.

Despite these initiatives that may stimulate the economy, however, the factor of political stability is palpably missing when it comes to promoting long-term economic growth. A World Bank report released just before the 2018 parliamentary elections warned that economic recovery is at risk, citing election-related violence as one of most important factors. The same report cautiously predicted economic growth at 2.4% in 2019, with a risk of a further decrease given the political instability around the parliamentary and presidential elections.

Political Instability

According to the economist Paul Collier, free and fair elections are considered an important factor for boosting the economy. Free and fair elections make the government accountable to its people and, as a result, encourage economic reform that benefits the voters. Any election that lacks transparency usually creates uncertainty and puts political stability at risk. Investors see free and fair elections as a signal that governments respect democracy and the rule of law, and are used by investors to monitor political risks for doing business in a country.

Since 2001, when the US-led invasion toppled the Taliban regime, consecutive Afghan governments have failed to fulfil the country’s hope for a transparent political process. During the 2004 presidential and 2005 parliamentary elections, there were allegations of mass voter fraud. Afghans remained hopeful, reasoning that those elections were conducted by weak and newly established institutions following years of civil war. Then came the 2009 presidential election, characterized by widespread ballot stuffing and mass electoral fraud. The same scenario carried on into the 2010 parliamentary election, which saw many warlords and strongmen enter the new parliament.

In 2014, the country experienced another fraudulent presidential election that brought the country to the brink of civil war. At the end of controversial election, the two frontrunners could not agree on the result, with then-US secretary of state, John Kerry, stepping in to persuade both candidates to form the National Unity Government, with Ghani as president and Abdullah in a specially created position of the chief executive.    

As a result of these election crises, the country has witnessed enormous economic shocks, especially post-2014, following the drawing down of international troops — from a high of 150,000 in combat role in 2011 to a low of 17,000 NATO and 14,000 US forces in an advisory role in 2019 — and significant decline in foreign aid. Household and private investment fell, leading to lower domestic demand, economic growth slowed from an average of 11.5% between 2009 and 2012 to 1.8% between 2013 and 2016. Weak economic performance and lower imports in 2014 resulted in a 9%-decline in fiscal revenue. The poverty rate has increased dramatically, from 38% in 2011-12 to 55% in 2016-17.

A perception survey conducted annually by the Asia Foundation shows national optimism decreased significantly post-2014. For example, in 2013, some 58% of Afghans thought the country is moving in the right direction, while in 2015 only 37% held this opinion. In 2014, according to the same survey, election fraud was mentioned by 9% of respondents as one of main reasons for being pessimistic about the country’s future.

Important Lessons

The disputed presidential election of 2014 could have provided important lessons to all stakeholders, and first of all the Afghan government, about the importance of a stable political process for a country with a fluctuating economy heavily dependent on foreign aid. However, last year’s parliamentary elections indicated that this was not the case. Many doubted the IEC’s ability to deliver democratic elections. Ronald E. Neumann, the US ambassador to Afghanistan between 2005 and 2007, wrote that “Despite four years to prepare and promises from President Ashraf Ghani and Chief Executive Officer (CEO) Dr. Abdullah Abdullah, the administration of the elections was a disaster. The administration of the Independent Election Commission was a shamble.”

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Some polling stations haven’t opened at all, some opened late. In some voting centers, election materials arrived late, and election staff didn’t know how to work the newly introduced biometric machines. The shortcomings and problems didn’t end there: The announcement of results was delayed multiple times, and Kabul election results were considered invalid at first, and then called after months of delay.

The credibility and inclusivity of the upcoming presidential election is a major concern. The opponents of President Ghani accuse the government of interfering in and engineering elections. Supporters of his main challenger, Abullah Abdullah, argue that polling centers in areas where, based on past data, people were more likely to vote for Abdullah are being closed. Arif Rahmani, a member of parliament from Ghazni, suggested this was happening in some of the safer districts of Ghazni province, dominated by ethnic minority Hazaras, where “they are closing the stations because they know Dr. Ghani will not get votes, and in some insecure places where he has support, they are leaving them open. The whole thing is upside down.”

Research by a local news agency shows that a presidential candidate, Farmarz Tamana, whose mother-in-law is the head of the IEC, has influence over the commission decisions. The report adds that through his influence on senior election body officials, Tamana appointed many of his supporters to positions within the entity.

A report by the Afghanistan Analysis Network shows that, with 75% of the country living in rural areas, voting will be heavily restricted due to attacks by the Taliban and polling stations remaining closed due to security issues. The Afghan Free and Fair Election Foundation expressed concern around security issues, difficulty of hiring observers and providing election materials, which all increases chances of fraud and places the validity of the election into question.          

The presidential election is an important opportunity for Afghanistan to avoid further political uncertainty and demonstrate to national and international investors that there is a democracy and a legitimate government, accountable to its citizens, that respects property rights, works on economic reforms, reducing corruption and poverty. Only then can real recovery take root in a nation ravaged by decades of war and political turmoil.

The views expressed in this article are the author’s own and do not necessarily reflect Fair Observer’s editorial policy.

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