Sunday, October 24, 2021

The Treasury Department says the U.S. has no plans to release billions of Afghan assets

WASHINGTON – The Biden administration has no plans to release the billions of Afghan gold, investment and foreign exchange reserves frozen in the United States after the Taliban took over. Despite pressure from humanitarian organizations and others, they say the cost may be the Afghan economy.

Most of the US$10 billion in assets of the Central Bank of Afghanistan are stored overseas, and they are considered a key tool for the West to pressure the Taliban to respect women’s rights and the rule of law.

Financial experts say that any thawing of these assets may take several months.

Since the Taliban took over Afghanistan in mid-August, officials from the U.S. State Department, U.S. Treasury, White House National Security Council, and other agencies have been regularly discussing Afghanistan’s financial issues, which predates the imminent humanitarian issues that the United Nations and other agencies consider. crisis.

Experts say that any decision to release funds may involve senior US officials in multiple departments, but it will ultimately be made by President Joe Biden.

Food and fuel prices have soared across Afghanistan due to the cessation of foreign aid, the cessation of dollar transportation, and the drought caused a shortage of cash.

Pakistan Afghanistan
On August 31, 2021, Afghan families gathered in the outskirts of Chaman, a small town bordering Afghanistan in Baluchistan Province in southwestern Pakistan, to receive food distributed by a Christian organization headquartered in Islamabad. (AP Photo)

The U.S. Treasury Department said this week that it has granted permission to the U.S. government and its partners to continue to facilitate humanitarian aid in Afghanistan. It also gave the world’s largest money transfer company Western Union and other financial institutions the green light to resume processing personal remittances from overseas migrants to Afghanistan.

A spokesperson told Reuters that the Ministry of Finance has not relaxed its sanctions on the Taliban, nor has it relaxed restrictions on their access to the global financial system.

The spokesperson said: “The U.S. government has been in touch with Afghanistan’s humanitarian partners regarding the local security situation and their ability to continue humanitarian work.”

“While we persisted in our commitment to the Afghan people, we did not reduce the sanction pressure on the Taliban leaders, nor did we reduce the severe restrictions on their access to the international financial system.”

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Maryland professors of economics, long-term members of the board of directors of the Central Bank of Afghanistan, senior Russian officials and humanitarian groups urged the U.S. Treasury Department to also unfreeze Afghan assets, saying that lives are at stake.

“The severity of the situation is so great. Every day in the past has led to more suffering and more people exodus,” Mehrabi said.

The International Monetary Fund also prevented the Taliban from using the new emergency reserves or special drawing rights of approximately US$440 million issued by the global bank last month.

Adnan Mazarei, a former deputy director of the International Monetary Fund and a current researcher at the Peterson Institute for International Economics, said that the United States cannot legally release Afghan assets before the emergence of an internationally recognized government, and this may take months to achieve. Once the government is recognized, the IMF cannot take action before its board of directors votes.

Afghans lined up outside the bank
Afghans lined up outside the bank
After the Taliban took over Kabul, Afghanistan on September 1, 2021, Afghans lined up outside the bank to withdraw money. (Stringer/File Photo/Reuters)

He said that unless as a last resort, the central bank’s reserves are usually not used. He said that even Iran, which is struggling under severe international sanctions, has not used its International Monetary Fund’s emergency reserves.

Brian O’Toole, a former Treasury official who now serves on the Atlantic Council, said that releasing Afghan assets will not solve the major problems in Afghanistan.

“Just releasing these funds will not stabilize the Afghan economy or do similar things. He said that its role is to get the Taliban “billions of dollars in funding.” “I don’t think the United States will have much interest in doing so. There shouldn’t be. “

Authors: Andrea Shalal and Daphne Psaledakis

Reuters

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This News Originally From – The Epoch Times

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