A year ago, the United States withdrew its troops from Afghanistan in a chaotic outing that left dozens dead and thousands exiled.
After the Taliban regained power in August 2021, the government of US President Joe Biden decided to freeze about $7 billion in assets that the Afghan central bank had in the Federal Reserve. of New York (another US$ 2 billion is in other countries).
This represents more than 40% of Afghanistan’s hard currency reserves and includes $500 million in private bank assets that are required by law to be deposited with the Afghan central bank.
The White House’s argument is that the release of funds could lead the Taliban to divert resources or not use them to improve the situation of Afghans.
Confiscation of reserves has been practiced before against other governments, institutions and individuals that Washington considers to have violated laws, committed corruption or participated in attacks against human rights.
But the crisis Afghanistan experienced last year, one of the worst in its history, prompted several experts and organizations to urge Biden to allow money from Afghanistan to flow back into the country.
Last week, more than 70 economists and experts, including Nobel laureate in economics Joseph Stiglitz (2001), urged Washington and other Western countries to release assets to allow the Afghan economy to get back on track.
“We are deeply concerned about the worsening economic and humanitarian catastrophes in Afghanistan and, in particular, the role of US policy in promoting them,” said the letter, also signed, among others, by the former finance minister. Greek Yanis Varoufakis.
“Without access to its foreign reserves, Afghanistan’s central bank cannot perform its normal and essential functions,” they added.
Experts considered that the US position only exacerbates the crisis situation that the Islamic nation has been experiencing since the return of the Taliban a year ago.
“The people of Afghanistan had to suffer doubly for a government they did not elect. To mitigate the humanitarian crisis and put the Afghan economy on the path to recovery, we ask that you allow the DAB (Afghan central bank) to recover its international reserves,” they said. .
Afghanistan’s economy is experiencing one of the worst moments in its history since the Taliban’s return to power, a situation that is not directly linked to the retention of funds in the US.
The sudden cut in international aid (direct foreign aid financed 70% of the Afghan government’s budget before the arrival of the Taliban) and the inflation caused by the war in Ukraine have deepened the situation of extreme poverty in the country, where millions of people are at risk of famine, according to estimates.
In this context, the country has been hampered by the inability of its central bank to function due to not having access to its reserves.
This resulted in a sharp depreciation of the Afghan (Afghan) currency, leading to rising import prices and the collapse of the banking system, with thousands of people unable to access their savings or receive wages.
long crusade
Washington and the Taliban have been in talks for months to discuss releasing the reserves, but they haven’t found a compromise.
Afghanistan’s new government is not recognized by most of the international community, and human rights groups have accused the Taleian of abuses, including extrajudicial executions and curtailment of the freedoms of women and girls.
The Taliban, for its part, has promised to investigate the alleged killings and says it is working to guarantee Afghans’ rights to education and freedom of expression “within the parameters of Islamic law”.
Among the solutions discussed to end the embargo on reserves is the creation of a mechanism that would include a trust fund, whose disbursements would be decided with the help of an international council.
But while the Taliban does not reject the concept of a trust fund, it does oppose the proposal that it be controlled by a third party.
On the other hand, the United States has opposed the Taliban’s appointment of a Washington-sanctioned person as deputy governor of the central bank of Afghanistan, which has also hampered the progress of negotiations.
September 11th
And the problem goes further.
These assets became the subject of litigation as some American victims of the 9/11 attacks asked that they be used to pay compensation for pending judgments against the Taliban.
Since the US began its crusade against “international terrorism”, it has allowed funds from organizations, countries or individuals deemed “terrorists” to be used to compensate victims or their families.
More than a decade ago, a group of 9/11 families obtained a sentence in absentia against the Taliban for their alleged collaboration with Al Qaeda, the extremist group that carried out the attacks.
After the Taliban regained power last year, a US federal district court ruled that since the Islamists now controlled Afghanistan, plaintiffs could go after the frozen assets.
The decision was highly controversial because the United States does not recognize the Taliban as the legitimate ruler of Afghanistan – and Afghanistan, as a country, was not named as a sovereign defendant in the initial lawsuit.
Last February, the Biden administration presented a plan that would transfer about half of the assets (about $3.5 billion) to third parties, but leave the rest in the US until the ongoing litigation is concluded.
Biden’s lawsuit and decision were not without controversy and questioning.
“The United States government is looting assets that legally belong to another government to reward its own citizens,” wrote Daniel W. Drezner, professor of international politics at Tufts University School of Law and Diplomacy, in a column in the newspaper. The Washington Post.
“If another country did that, it would be seen as outright theft. And that makes it much easier for other great powers to act in a similar imperial manner,” he added.
“The long-term implication is to give other countries one more reason to resent and fear that the US will use the dollar as a weapon. Because no matter what legal justification is provided, the federal government is stealing Afghanistan’s money,” he concluded.
Among those who oppose the return of money from the Afghan central bank are those who point out that much of it comes from international aid from the US and other Western countries.
This text was published originally here
