FirstFT: Afghans face ‘dire’ financial outlook

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The people of Afghanistan are facing “dire” financial prospects, the former head of its central bank has warned, cautioning that an acute shortage of dollars and higher inflation will fuel the flow of migrants out of the country.

Ajmal Ahmady, who escaped Kabul on Sunday, told the Financial Times that Afghanistan had been dependent on bulk shipments of dollar reserves from the US and was now rapidly running short, leading to the likelihood of higher food prices and capital controls.

“If you think the situation at the airport is now bad, I think over the medium term, you’re going to see major, major migration flows from Afghanistan and, unfortunately, if Europe or other countries think that they could stop that, you simply can’t,” he said.

The Islamist group yesterday cracked down on the first public display of dissent since it seized power. At least three people were reportedly killed as fighters violently dispersed people from an anti-Taliban protest, while the US struggles to evacuate American citizens and their Afghan allies. Follow the latest on FT.com. (FT, Reuters)

More on the fall of Afghanistan:

What questions do you have about the Taliban’s rise to power? FT journalists may address them in our upcoming webinar with US defence correspondent Katrina Manson, Asia companies and markets editor Stephanie Findlay and US managing editor Peter Spiegel. Register here for The Fall of Afghanistan: What’s Next on August 25. Thanks for reading. — Jennifer

Five more stories in the news

1. Exclusive: CME in $16bn bid for Chicago exchange rival CME Group has approached Cboe Global Markets about an all-share deal to acquire the owner of the Vix volatility indices for nearly $16bn.

2. Goldman Sachs to buy European asset manager The bank’s asset management unit has agreed to buy Dutch insurer NN Group’s investment management arm for about €1.6bn, marking the Wall Street lender’s largest acquisition since David Solomon became chief executive in 2018.

3. Brexit immigration rules blamed for run on chickens UK chicken producers say post-Brexit immigration restrictions are to blame for staff shortages that have forced them to reduce supply, causing restaurants including KFC and Nando’s to cut menu items and close branches.

4. Exclusive: Lloyds Bank aims to be UK landlord Lloyds Banking Group is aiming to become one of the UK’s largest landlords by purchasing 50,000 homes in the next 10 years, according to internal documents.

5. Millions of T-Mobile customers’ data leaked The personal information of almost 50m people has been “stolen” from T-Mobile US in the latest high-profile data breach in recent years. The mobile telecoms group said the “highly sophisticated cyber attack” resulted in personal details of its current, former and potential customers being taken.

Coronavirus digest

  • A rise in vaccinated people becoming infected with coronavirus has cast doubt over the lasting efficacy of Covid-19 vaccines, according to new studies.

  • UK ministers and MPs were accused of “undermining public health messaging” yesterday after some opted not to wear face coverings during parliament’s emergency debate on Afghanistan.

  • A majority of Federal Reserve officials believe that the US central bank could start withdrawing its pandemic stimulus programme later this year.

  • The Biden administration is set to begin offering Americans third doses of mRNA vaccines next month.

While injections of liquidity were invaluable in preventing an economic catastrophe last year, central bankers’ claims that quantitative easing would boost gross domestic product are less convincing, writes John Plender. Follow our live blog for the latest coronavirus news and sign up for our Coronavirus Business Update newsletter.

The day ahead

FTC faces deadline on Facebook suit The Federal Trade Commission has until today to submit an amended complaint in its Facebook antitrust suit after a federal judge dismissed the complaint, saying the agency’s argument that Facebook had monopoly power over the social network market was “legally insufficient”.

Tesla AI Day Elon Musk is expected to give a keynote at Tesla’s AI Day. The event comes days after the US government launched an investigation into crashes involving the carmaker’s Autopilot driverless technology and US senators called for a probe into the company’s marketing practices.

US jobless claims Economists expect applications for unemployment benefits to continue to fall in the week ended August 14. (WSJ)

What else we’re reading

Interview: Germany’s Greens split from Merkel era Annalena Baerbock, the Green candidate for chancellor, vowed to get tough on China and Russia and reform Europe’s fiscal rules if her party gains power, marking a break from the policies of outgoing chancellor Angela Merkel. Baerbock spoke to the FT’s Erika Solomon in a rare interview with foreign media.

Annalena Baerbock: ‘This country’s prosperity was built on our industry, and if that success is to continue in the future, Germany must become climate-neutral’
Annalena Baerbock: ‘This country’s prosperity was built on our industry, and if that success is to continue in the future, Germany must become climate-neutral’ © AFP via Getty Images

Electronic payments power Nigeria’s start-up boom The country’s economy may be struggling but its fintech groups have attracted more than $1bn in venture capital in the past two years. But it comes as critics argue the government has taken a heavy-handed approach to the sector.

UK business ‘greenwashing’ claims As consensus on the importance of environmental issues has grown, so has confusion over claims to be addressing them. Regulators need to eye dubious eco-friendly statements and companies need to pay attention, writes Helen Thomas.

Big Tech wants its workers back where it can see them In the midst of a truly disruptive global trend, the greatest disrupters are clinging on to tradition, writes Elaine Moore. According to data from the US Postal Service, the number of people moving out of the Bay Area is back to pre-pandemic levels. If given the option, do you intend to work from home at least part of the time after the pandemic? Vote in our poll.

Political gestures vs gesture politics Statements can seem little more than gesture. Yanis Varoufakis’s call for Afghan women to “hang in there sisters!” didn’t feel substantive. Yet some gestures can have real power, and impact. Footballers taking the knee before matches, for example, offer a potent reminder of the need for change, writes Jemima Kelly.

Travel

The balm of green waters The right to navigate Britain’s waterways is contested — but there is nothing to match it for a tranquil, restorative escape. Horatio Clare takes readers on a wild Welsh canoe trip.

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