Afghan small business owners in anxious wait over what comes next

Businesses in Kabul struggle to attract customers as thousands seek way out of the country following Taliban takeover.

Most banks in Kabul have remained closed and nearly all ATMs are out of cash [Shah Marai/AFP]
Most banks in Kabul have remained closed and nearly all ATMs are out of cash [Shah Marai/AFP]

Kabul, Afghanistan – In the week since the Taliban took over Afghanistan, the nation’s small business economy has been dealt a series of devastating blows.

Most banks remain closed, nearly all ATMs do not dispense cash, government offices largely remain shut, the passport directorate and visa offices are closed, weddings and other joyous occasions have come to a halt.

The small business owners who usually sell goods and services around these parts of life are left to wonder what comes next.

Noor Mohammad, the proprietor of a family-run barbershop, said since the Taliban took over on August 16, his business has faced several obstacles, as the social lives of Afghans across the capital changed overnight.

The first blow was immediate – fear. During their strict five-year rule in the 1990s, the Taliban forbade men from shaving their beards, deeming it to be un-Islamic. Since taking over the country, the group has not imposed social restrictions on the population, but anxiety looms over the people like a dark, foreboding shadow.

“No one wants to wake up and be beaten on the street or taken to jail for having shaved,” he said.

As little as 10 days ago, the four chairs in Mohammad’s modest shop would earn him up to 4,000 Afghanis ($46) a day. But in the last week, he has earned about 400 Afghanis ($4) a day. Now, he fears that he will not be able to make his $400 a month rent payment unless life in the capital returns to normal soon.

The closure of private and government offices has also affected his business. He said that before the former President Ashraf Ghani fled and the Taliban took over, office workers would come to his shop every two weeks to trim their beards and style their hair.

“People are afraid to leave their houses now, who are they going to cut their hair for,” he says in his empty shop.

With daily life grinding to a halt, special occasions have also been paused. Previously, Mohammad’s biggest spenders were grooms, who would typically splash out thousands of Afghanis on preparing for their wedding parties, but with the nation’s lavish wedding halls now shut, those customers are gone.

Next to Mohammad’s barber shop is a small grocery store, run by 42-year-old Younus. He too is fearful that he will not be able to afford his $800 monthly rent payment if life does not return to normal soon.

For the last 25 years, Younus has depended largely on nearby offices, whose staff bought groceries from his shop.

In the days before the Taliban took over Kabul, banks across the city were overrun as people scrambled to withdraw as much of their money as possible. The banks have remained shut since the armed group seized control of the Afghan capital.

With many households unable to access cash savings in their accounts, Younus cannot rely on families’ spending to make up for the shortfall caused by the closure of nearby offices and businesses.

“We used to have internet providers, travel agencies and other offices buy from us, but now, every day, we see them packing up their furniture and closing,” he says.

Without customers asking for their basic food staples, he passed the time by scrolling on social media. “I just stand here all day, browsing Facebook and waiting for one person to purchase even a Pepsi or a yoghurt.”

Younus said that his business had been suffering since the start of Ghani’s second term in early 2020, following the uncertainty caused by a drawn-out election the previous year that slowed investment in the country. The problems were heightened when the government imposed a months-long lockdown in an attempt to contain the coronavirus pandemic. But he said the current state of affairs is far worse.

“All of society has stopped. Unless the Taliban announce their government soon and people return to work, we will have to close down shop.”

Younus’s business has also been affected by increases in the price of basic staples. Store owners reported that the prices of cooking oil, flour and eggs have all surged in the last week.

At a bank near Younus’s shop, the ATMs have been inactive since the Taliban took control of the cities of Herat and Kandahar on August 12. This widespread inability to access cash has, in turn, hurt the trade of the currency exchangers who operate on the streets and small shops.

Last week, Western Union also suspended activity in the country, cutting off a key route for transfers of money to individuals from abroad.

Ahmad, a money exchanger who has worked across from two banks for 10 years, said his business has fallen between 80 and 90 percent in the last eight days. He says even a few weeks ago, people would stop and exchange $100 bills on the street. But now, he may have one or two such customers each day.

“Fine, the arrival of the Taliban means no more fear of theft, but now no one has any money for anyone to steal,” he said, standing in front of a row of shuttered paint and electronics stores.

On August 16, the day the Taliban seized the capital, former Central Bank governor Ajmal Ahmady posted on Twitter that he had been told the previous Friday that “we wouldn’t get any more dollar shipments” from the United States. The Biden administration has also frozen $9.5bn of the Afghan central bank’s assets that are currently held in the US.

With an economy so dependent on US dollars, such cuts have already proven detrimental. Businesspeople have said if it continues, it could turn into an economic disaster for the country.

Earlier this week, the Taliban announced it had appointed Mohammad Idris as acting chief of the central, bank. Idris’s educational qualifications, professional background and experience in dealing with monetary, currency and banking policy remain unknown.

Mohammad, a taxi driver standing next to Ahmad, used a simile to explain the current economic situation in the country.

“It’s like being an orchard of full apples and you not being able to reach high enough to pluck even a single one,” Mohammad said of the effect of bank closures in the country.

Mohammad said with everything shut, he now spends up to three hours at a time waiting in between customers. In the past, when business was bad during the day, he could have parked outside the nearby Shahr-e Naw Wedding Hall at night to make up for the day’s lost earnings. Today, with no weddings taking place, he does not have that option.

“Each night, I go home to my six children and they just look at me hoping I brought home enough money for dinner. I have to avert their eyes and hang my head in shame.”

Businesses that cater to wealthier, young people have also been forced to adapt to the new social climate. Milad Amiri, who handles marketing for the Buffalo Kings sport lounge, said the eatery has diverted its attention towards its delivery business.

The company recently introduced a new take-away package where families can buy a pizza, lemonade and several other fast-food items for 1,000 Afghanis ($11.61). Amiri said the margins on such orders are slim, but that they want to take people’s current economic state into account.

With access to cash limited, Amiri said dining out is secondary in people’s minds compared with other necessities. Rather than spending 1,500 Afghanis ($17.41) on a single shisha, people would rather save their money for the essentials.

“Why would you spend 1,000 Afghanis here if you could go buy bread and flour with that, in case tomorrow ends up worse than today,” he said.

Amiri said that many Afghans are preoccupied with trying to obtain visas to leave the country.

“All of Afghanistan is trying to go to the airport right now,” Amiri said.

“People are too pre-occupied standing outside embassies and trying to fill out visa forms. They’re all in internet cafes, not restaurants.”

Source: Al Jazeera

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