IMF, Afghanistan agree on aid

By Agence France-Presse


KABUL – The IMF February 4 said it had reached an agreement with Afghanistan on the reform path needed to unlock the next aid instalment for the war-ravaged country.

The International Monetary Fund granted Afghanistan a US $133.6m (6.9 billion AFN) line of credit in November 2011 to help the country through the withdrawal of foreign military forces in 2014.

But to date the IMF has disbursed only two instalments of about US $18m (932.3m AFN) each.

After a two-week mission in Afghanistan, an IMF team reached "understandings" with the Afghan authorities on a reform path to allow further aid, the IMF said in a statement.

The disbursement is contingent upon "the implementation of key structural benchmarks for submission of laws to parliament and strengthening banks' capital," the IMF said.

It said the Afghan authorities had agreed on the need to tighten monetary policy, in part to protect the country's international reserves position.

The authorities also saw the need to increase revenues by strengthening customs measures and to prepare to implement a value-added tax (VAT) in 2014, the IMF said.

"The economic outlook for Afghanistan is broadly positive," the IMF said, adding that growth and inflation were better than expected in 2012.

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