WASHINGTON, Feb 5: The economic outlook for Afghanistan is broadly positive and growth and inflation in 2912 were better than expected, says the International Monetary Fund.

An IMF report, released on Monday, noted that a large crop has boosted real GDP growth to 12 per cent and helped moderate inflation, which was 6pc year-on-year in December 2012.

In 2013, the economy will continue to grow and inflation is expected to be stable.

An IMF team visited Kabul during Jan 19 to Feb 2 to conduct discussions on the combined second and third reviews of Afghanistan’s IMF-supported programme under the Extended Credit Facility.

The IMF team reached staff level understandings with the authorities on a path to complete the combined 2nd and 3rd reviews, subject to implementation of key structural benchmarks for submission of laws to parliament and strengthening banks’ capital.

Discussions focused on maintaining macroeconomic stability and structural reform momentum in 2013.

On the budget, there was agreement on the need to restore momentum to revenue mobilisation through measures to strengthen customs administration.

To build revenue momentum over the medium term, the Afghan authorities will continue and intensify their preparations for the successful implementation of the value-added tax in 2014.

It was agreed that some tightening of monetary policy was appropriate to maintain price stability and protect the international reserves position.

There was also agreement on reforms to strengthen the financial sector and economic governance, and to mobilise domestic revenue.