ISLAMABAD, April 10: Afghanistan has one of the highest infant, child, and maternal mortality rates, and one of the lowest literacy and life expectancy rates in the world, says a latest report of the Asian Development Bank (ADB).

ADB “Outlook 2002” says that Afghanistan has also one of the highest proportions of disabled people in the world.

Disruption in transport and communication has fragmented the economy and society. Delivery of social services has come to a halt. Women and girls were forbidden access to education and prevented from working in many places during the Taliban regime.

The report says a system of internal governance and a financial system need to be quickly established to absorb and utilize international assistance effectively.

“Afghanistan will likely experience rapid growth over the next few years as rehabilitation, renewed confidence, and re- established external economic relations quickly boost productive capacity.”

At the second meeting of the Afghanistan Reconstruction Steering Group, concluded in Tokyo in early 2002, the international community addressed the country’s urgent development needs, pledging a total of $4.5 billion in external assistance, including $1.8 billion for 2002.

The report believes that long-term development prospects are good. The Preliminary Needs Assessment — jointly prepared by the ADB, the United Nations Development Programme and the World Bank at the initiative of the Steering Group — estimated that reconstruction requirements are $1.7 billion in the first year and about five billion dollars in the first two- and-a-half years.

It says that apart from the fiscal system, the interim administration also needs to immediately review its monetary and financial systems. The financial sector used to comprise a central bank, established in 1938, and four commercial banks, which were all nationalized in 1975.

“The authorities now need to quickly re-establish regulation of both financial intermediation and foreign currency transactions to stabilize the Afghani currency. Its rapid appreciation has already upset the basis on which external aid flows were calculated”.

The UN had initially appealed for a “start up” fund of $20 million to enable the interim administration to start functioning. However, by under-estimating the size of civil service, and given the appreciation of the Afghani, the interim administration requires a start-up funding equivalent to $100 million, including $70 million to cover back pay owed to civil servants.

An initial inflow of seven million dollars was almost all liquidated immediately by a first back-pay instalment of six million dollars for one month (from Dec 16, 2001 to Jan 15, 2002).