The US is at least trying to block the Taliban’s money

The Biden administration was quick to deprive the Taliban of funding allocated to the Afghan government, freezing government reserves held in US bank accounts and preventing the Taliban from accessing billions of dollars held in financial institutions, according to the Washington Post, citing two people familiar with the matter. All this a week after Congress confirmed aid to the Ghani government.

The decision was made by Treasury Secretary Janet Yellen and officials from the Treasury's Office for the Control of Foreign Assets. The State Department was also involved in discussions this weekend, with White House officials monitoring developments. An administration official said: "Any central bank assets that the Afghan government has in the United States will not be made available to the Taliban."

In April, according to the International Monetary Fund, the Afghan central bank held reserve assets of $ 9.4 billion, about a third of the country's GDP. The vast majority are held outside the country, according to the Post, billions of them in the United States.

According to the report, the freeze went into effect on Sunday. As the situation was rapidly deteriorating over the weekend, Afghan Central Bank Governor Ajmal Ahmady tweeted that he had been told they would no longer receive shipments of dollars.

Meanwhile, the United States sends about $ 3 billion annually in support of the Afghan military, which can only be sent if the Secretary of Defense "certifies to Congress that Afghan forces are controlled by a civilian and representative government committed to protection of human rights ". Obviously, at this moment, this possibility does not exist.

About 80% of Afghanistan's financial resources come from international donations, first of all from the USA, but also from the European Union and pro-American Islamic countries. According to UN agencies, one in two Afghans has resorted to international aid to meet their needs.

At this point, a series of very complex scenarios and perspectives open up. Once the little available is exhausted, it will be necessary to see what will happen at the international level and how the new government will play it:

• China is unlikely to replace the US financially. Belt and Road also showed more than Beijing's generosity, the unscrupulous use of the debt weapon;
• the EU will bend to 90 degrees, as it does with practically everyone, but financially it will not be the predominant part for the commitments towards Africa;
• The US could obtain concessions with the use of the financial weapon and these billions already in the possession of the Central Bank, but now blocked.
• The Taliban, deprived of financial resources, could engage in large-scale criminal activities related to drug production, which they already did.
• At this point the civilian population will become an instrument of blackmail towards Western countries.

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The article The US tries at least to block the Taliban's money comes from ScenariEconomici.it .

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This is a machine translation of a post published on Scenari Economici at the URL https://scenarieconomici.it/gli-usa-cercano-almeno-di-bloccare-i-soldi-dei-talebani/ on Wed, 18 Aug 2021 07:11:15 +0000.