Experts call for review of the montary policy

KABUL (SW) – A number of experts believe the current monetary policy of keeping value of the afghani high with no impacts on the prices in the market is of no use to the public.

Although the value of the dollar against the afghani has decreased significantly of late, but the price of food in the country has not changed so far. A number of economic experts say that the Da Afghanistan Bank is trying to reduce the price of the dollar against the afghani without considering the international principles of exchange, which is based on expediency and monetary policy that is why it will not affect the price of raw materials.

Zakaria Heydari, an economic expert, told Salam Watandar about this: “Unfortunately, the exchange rate in Afghanistan is artificially determined by the central bank. That is, the central bank tries to lower the rate of the dollar and raise the value of the afghani so that the people can buy it. But they fail to keep the prices stable globally. The dollar has not depreciated in the world, and if it has, it has depreciated to the extent of one or two rupees, which has not decreased globally to the extent that it has decreased in Afghanistan. For this reason, there is no change in the rate and the rate.”

Mohammad Assef Nang, another economic expert, also says in this regard: “According to economic analysis, the value of money is based on two principles. One is the apparent basis and the other is the real basis of money, which in Afghanistan is based on the appearance and is very credit oriented. It means that the real value of money has not found its place.”

On the other hand, a number of Kabul residents say that the price of raw materials and fuel has not changed with the decrease in the value of the dollar against the afghani.

Abdul Basir, a taxi driver in Kabul, says: “The value of the dollar is decreasing day by day, but the price of food, oil and other goods does not go down. I was buying the same item yesterday, which used to cost 105-110 dollars, but they said it is $140 now. The reason is that the currency is controlled, but not the food prices.”

Khaliq, a resident of Kabul, also says: “Every time the dollar goes up and down in the market, there are small changes in the price of food items, which is not acceptable. Now let’s see, the dollar rate is very low, but food items such as flour, rice and oil are at the same price as before.”

However, food vendors say that food prices have changed compared to the past. Dawood, one of the shopkeepers in the “Dehan Bagh” area of Kabul city, says: “Oil has dropped from 500 to 420 afghani, the price of flour was 1,700 to 1,800 afghan which has become 1,650 afghan and rice has reached 2,700 afghan.”

At the same time, officials in Kabul Municipality say that they have serious supervision over the market and control the price of food and fuel every week. Nematullah Barakzai, the spokesperson of Kabul Municipality, says that when the price of the dollar rises, the price of food also rises because Afghanistan is an import country, but when the value of the dollar goes down, the Kabul municipality sets a specific price list to prevent hoarding and overselling.

He adds: “Kabul municipality does not give a price list to the entire city of Kabul and it is limited, which includes only basic materials, which must be sold accordingly, and if someone sells at high prices, his shop will be closed, and if it is repeated twice, he will be referred to judicial institutions. There is no doubt that the dollar rate has gone down and we set the price list every week. The stability of the dollar is very important and we set the same rate accordingly.”