The International Monetary Fund (IMF) said it would prevent Afghanistan from accessing nearly $500 million in aid, just days after the Taliban took over Kabul and toppled the US-backed government.
The IMF is expected to issue a new asset allocation proposal on August 23, also known as a special drawing right (SDR), with about $450 billion designated for Afghanistan.
“As usual, the IMF generally moves from the perspective of the international community,” an IMF spokesman said in a statement. “Currently, the international community is still unclear about the recognition of the government in Afghanistan, so the country cannot access SDR (special drawing rights) or other IMF resources.”
The decision came after a group of 18 Republican lawmakers sent a letter to Treasury Secretary Janet Yellen urging her to intervene at the IMF to ensure the Taliban could not access the reserves.
“The SDR allocation is intended to provide nearly half a billion dollars in unconditional liquidity to a regime with a history of supporting acts of terrorism against the United States and its allies at risk,” they wrote. hideously unsettling.”
This reduction in the allocation of funds to the Taliban follows a decision by the Treasury Department to freeze Afghan government reserves in US banks on August 15, essentially with the aim of preventing the group from doing so. This access to billions of dollars in aid.
The Washington Post, citing two sources familiar with the matter, reported that Treasury Secretary Janet Yellen and officials in the Treasury Department’s Office of Foreign Assets Control made the decision. The US State Department participated in discussions over the weekend, while White House staffers are also closely monitoring developments.
“Any Central Bank assets that the Afghan government has in the United States will not be made available to the Taliban,” an administration official told the Washington Post.
This could be the first of many important choices facing the Biden administration as the Taliban return to power. Afghanistan, which is already on the list of the world’s poorest countries, is still heavily dependent on US aid.
John Sopko, special inspector general for Afghanistan reconstruction, told Reuters earlier this year that about 80% of Afghanistan’s budget is aided by the United States and other international donors.
The total reserves of the Central Bank of Afghanistan are about $9.4 billion as of the end of April 2021. However, most of these reserves are sent outside the country, making it unlikely to fall into the hands of the Taliban.