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How will markets be affected after the Taliban takeover of Kabul?

Aug 16, 2021
How will markets be affected after the Taliban takeover of Kabul?

How will markets be affected after the Taliban takeover of Kabul?

Dr.. Hashem Mahmoud Younes


According to Yuri Kageyama, writer and economic analyst at The Associated Press, the Taliban’s invasion of the Afghan capital may seem like a far-fetched event, but it will undoubtedly affect markets elsewhere, including Asia.

“The markets will try to push back this geopolitical earthquake, saying it is only Afghanistan,” says Yuri Kajima. But this geopolitical nightmare is just beginning.”

As for us, and in our analysis of the dimensions of this geopolitical earthquake as described by Yuri Kajima, we realize that sales of advanced American weapons (SE:2120) to that region of the world – and perhaps to other regions – will drop sharply. But before that, it was fighting with old-fashioned Russian weapons and what was available from semi-expendable bombers. The equation says that an old Russian weapon defeated an advanced American weapon.

What makes matters worse is the confident tone that the US president spoke a few days ago, stressing that the 300,000 very well-armed Afghan soldiers, according to him, with modern American weapons and trained on them, will not collapse in front of the 75,000 poorly armed Taliban fighters.

The most worrying thing is that the collapse did not take months, three days between the statements of the US president and the Taliban’s entry into the presidential palace. The equation appears as if it concerns the arms industry only, but the matter has further and more serious consequences.

On the level of American politics, the failure in the expectations that became apparent to US President Joe Biden will be very apparent, and along with other negatives, it will be a weapon in the hands of the Republicans who follow a very easy strategy to turn between the Democrats and get another presidential term for their president, Joe Biden handed Afghanistan because of bad Estimated, Donald Trump began the withdrawal, but he was orderly and calm, but Biden finished off investments of billions of dollars in the Afghan security establishment and the American presence there.

Also, Russian opportunism is currently playing its role. While Russia did not close its embassy in Kabul and did not withdraw any of its diplomats, it seems that new relations are forming between Russia and the Taliban, while China preempted everyone through a series of meetings before the fall of Kabul.

The absence or decline of American influence, and the abandonment of important strategic areas will be influential in the upcoming elections. In addition to controversial economic plans, the democratic presence in the White House seems to be difficult during the upcoming elections.

The expected decline in arms sales is also related to the confidence of America’s friends around the world that America will keep its promises to them to protect and stay on the ground. Consequently, it entails commercial deals with them that will not stop at weapons, but will extend to all aspects of the economy, and from the F-16 to the MiG with its different models, and from the preference of Airbus over the costly Boeing, and even through training programs and the establishment of factories, the next may not be happy for the United States, which needs to open New markets to maintain its economy without damage and not to burst the bubble of US stocks.