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Biden freezes Afghan currency reserves to cut off Taliban cash

The Biden administration has frozen billions of dollars in Afghan currency reserves and other assets held in US financial institution accounts subsequent the Taliban reconquest of that country’s federal government, a report explained Tuesday.

The freeze was executed Sunday pursuing conversations concerning Treasury Secretary Janet Yellen and other officials at the Treasury and Point out Departments, in accordance to The Washington Put up.

While those conversations took area, the Taliban swept into Kabul, finishing a 96-hour route through Afghanistan that dealt a demise blow to the Western-backed authorities of President Ashraf Ghani.

Afghanistan’s central lender held $9.4 billion in reserve assets, a small much less than half of the country’s gross domestic product or service in 2019. Most of that money is held outside the house Afghanistan’s borders, although it isn’t obvious how significantly of it is in the United States, the paper mentioned, citing the Global Financial Fund.

The departure of overseas troops and the advance of the Taliban is contributing to mounting political and economic insecurity in the country.
Haroon Sabawoon/Anadolu Company by using Getty Illustrations or photos

The decision to freeze the belongings is very likely to place a further more squeeze on the currently-fragile Afghan economy and heighten the necessity for the US to boost humanitarian assist to a population coming below the yoke of the Taliban the moment once more.

In June, the State Division introduced a lot more than $266 million in humanitarian aid to Afghanistan, bringing the total considering that 2002 to $3.9 billion. President Biden vowed Monday that the US “will continue to help the Afghan people” and “lead with our diplomacy, our global influence, and our humanitarian support.”

On Tuesday, Nationwide Protection Adviser Jake Sullivan hinted to reporters that the US could use sanctions to power the Taliban absent from some of the a lot more oppressive policies from their first stint in cost of Afghanistan. Current American financial sanctions prohibit US citizens from engaging in “any transaction or dealing” with the Taliban.

“The reason I never want to go into fantastic depth on it is, I want to be equipped to have our staff connect directly to the Taliban both of those what the expenses and disincentives are for specific sorts of action and what our anticipations are,” Sullivan claimed. “That is a dialogue that we will intend to have, and I assume quite a few other nations around the world, together with likeminded allies and associates, will be having that as perfectly.”

Taliban fighters stand guard along a roadside near the Zanbaq Square in Kabul on August 16, 2021
Taliban fighters stand guard along a roadside around the Zanbaq Square in Kabul on August 16, 2021.
WAKIL KOHSAR/AFP through Getty Illustrations or photos

With the currency reserves out of their achieve, the Taliban are probable to vacation resort to the funds-raising strategies they used in the course of their very first stint in electrical power from 1996 to 2001: taxation on the opium and heroin trade, as nicely as unlawful mining. There is also the chance that Chinese or Russian companies could get to out to gauge the regime’s desire in mineral or fuel development concessions.

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