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Word Count: 528
The extent of destruction Afghanistans economy has seen widespread destruction over the past two decades of war Most of the major formal social administrative and economic institutions of the country have fallen apart due to the Soviet occupation population displacement and continued heavy fighting among various Muja hidden factions in 1992 The nations transportation and communication systems heavy and small-scale industries education and agricultural infrastructure are among the most seriously damaged sectors that need a tremendous amount of investment when peace and stability return to the country At present it would be difficult to expect significant improvement in the economic situation of the country Deterioration of the situation This economic decline has exacerbated the level of poverty and economic hardship throughout the country Largely dependent on subsistence agriculture the country has witnessed diminishing income levels declining food security reduced access to urgently needed services and an increasing population Regional disparities A wide range of disparities exists between different regions and within each region While Herat Jalalabad and Kandahar have largely benefited from cross-border trading with neighbouring countries the northern provinces in particular the isolated and chronic food deficit provinces of Badakhshan and Bamyan have been badly affected by natural disasters and heavy fighting that took place in August and September 1998 The Taliban authorities reportedly blockade the provinces of Parwan and Kapisa which has caused a tremendous increase in prices of essential items The changing state of the economy Previously the Government of Afghanistan controlled the economy and major investments were made in the public sector The private sector was active in agriculture and trade activities During the course of the past two decades the reduced role of the central government has encouraged the private sector to play a prime role in the nations traditional economic activities The potential for further improvement of the private sector is still high and a large number of Afghan businessmen and traders might be interested in
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