Islamic Republic of Afghanistan - Enhanced Integrated Framework ...

In the short term, the Government will focus itspublic expenditure programs on investments ininfrastructure, agriculture and rural developmentin recognition of the high importance ofthese sectors for the development of the privatesector and for employment growth. Over thelifetime of the ANDS, the Government will focusprogressively more resources on education,governance, health, and social protection. TheGovernment commits to allocating sufficientresources to the key priorities of strengtheningeconomic governance and improving the enablingenvironment for private sector development.CONCLUSIONFor Afghanistan to become a peaceful andprosperous country able to provide its peoplewith an acceptable standard of living, it has tobuild a strong economic foundation that willsupport long term and broad-based economicgrowth with the private sector as its engine.With sound macroeconomic policies undertakenduring the last five years, per capita incomenearly doubled. For the poverty reductiongoals of the ANDS to be achieved, comparablelevels of economic growth will be neededin comings years. This will require a conduciveenvironment for social and economic development,which in turn depends on the continuedmaintenance of sound and stable macroeconomicpolicies to enable the private sector toestablish itself as a vigorous engine of growthand employment creation.A key strategic objective of the ANDS is to establisha secure economic environment inwhich it will be possible to attract sufficientlevels of private sector investments that willlead to the increased employment of human,financial and natural resources in more productiveways. A critical element in achieving thisobjective will be to substantially increase investmentin capacity development and creatinga skilled workforce in order to expand employmentopportunities and increase incomes.Average economic growth is projected at an 8.1percent rate for 1387-1391. A key assumptionunderlying this ambitious goal is an increasingshare of total investment will come from theprivate sector. To reach these goals, the Governmentwill continue to maintain strong macroeconomicmanagement characterized by fiscalsustainability, prudent monetary policies,and the avoidance of short-term ad hoc measures.The ability to implement the projects and programsincluded in the ANDS depends upon theresources that will be available. In this regard,a major contribution of the ANDS has been thedetermination of budget ceilings that reflect theGovernment’s sectoral priorities. These arebeing built into the MTFF and the Ministry ofFinance’s program-based budgeting systemfocused on achieving the country’s developmentneeds. Security will remain the Government’shighest priority, while the public expenditureprograms for investments in energy,water and irrigation, transportation infrastructure,agriculture, agro-based industry, and ruraldevelopment will remain high priorities,acknowledging the high importance of thesesectors for the development of the private sectorand for long term and sustainable employmentgrowth. In the coming years the Governmentwill also devote progressively moreresources on education, governance, health,and social protection.Macroeconomic Framework 51