US freezes $9.5bn funds
to block Taliban access

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WASHINGNTON: The Biden administration on Tuesday froze about USD 9.5 billion of Afghan reserves to keep cash away from the Taliban after it captured Afghanistan.
US Treasury Secretary Janet Yellen and personnel at the Treasury’s Office of Foreign Assets Control had decided to freeze the accounts, reported Dawn citing The Washington Post. “Any central bank assets the Afghan government have in the United States will not be made available to the Taliban,” an administration official told the newspaper in a statement.
According to the report, the US State Department was consulted before the action as was the White House, adding that the Biden administration was contemplating other actions as well to pressure the Taliban, reported Dawn.
It pointed out that the Biden administration did not need new authority to freeze the reserves because the Taliban were already under sanctions from an executive order approved after the September 11, 2001, terrorist attacks.
Ajmal Ahmady, acting head of Da Afghanistan Bank (DAB) — the nation’s central bank — tweeted earlier this week that he learned on Friday that shipments of dollars would stop as Washington would not allow the Taliban to access the funds.
“Any central bank assets the Afghan government have in the United States will not be made available to the Taliban,” an administration official told the newspaper in a statement.

The Taliban will be denied access to any Afghan reserves held in US accounts, a US administration official said on Monday. As US forces were evacuating Afghanistan’s capital after the Taliban’s swift takeover, the official said: “Any Central Bank assets the Afghan government have in the United States will not be made available to the Taliban.” The central bank’s gross reserves totalled $9.4 billion at the end of April, according to the IMF.

But most of those funds are held outside of Afghanistan, according to a person familiar with the matter. It was not immediately clear what share of the assets are held in the United States.

US President Joe Biden

The country’s central bank governor Ajmal Ahmady went to Twitter to detail his harrowing escape from the country on a military plane on Sunday, after he and his team tried to stabilize the currency amid the Taliban advance towards the capital.

Ahmady, who did not say where he was, said the central bank was informed on Friday that “given the deteriorating environment, we wouldn’t get any more dollar shipments,” and he met on Saturday with banks and money exchangers to reassure them.

“Once (the) president’s departure was announced, I knew within minutes chaos would follow. I cannot forgive him for creating that without a transition plan,” he tweeted Monday.

“It did not have to end this way. I am disgusted by the lack of any planning by Afghan leadership. Saw at airport them leave without informing others.”

According to the report, the US State Department was consulted before the action as was the White House, adding that the Biden administration was contemplating other actions as well to pressure the Taliban.

It pointed out that the Biden administration did not need new authority to freeze the reserves because the Taliban were already under sanctions from an executive order approved after the September 11, 2001, terrorist attacks.

Washington also stopped shipments of cash to Kabul as part of an effort to prevent a Taliban-led government from accessing money, according to a Bloomberg reported.

According to Bloomberg, the DAB has $9.5bn in assets, a sizeable portion of which is in accounts with the New York Federal Reserve and US-based financial institutions.

More than 2,200 diplomats and other civilians have been evacuated from Afghanistan on military flights, a Western security official told Reuters on Wednesday, as efforts gathered pace to get people out after the Taliban seized the capital.

The Taliban have said they want peace, will not take revenge against old enemies and would respect the rights of women within the framework of Islamic law. But thousands of Afghans, many of whom helped US-led foreign forces over two decades, are desperate to leave.

“We are continuing at a very fast momentum, logistics show no glitches as of now and we have been able to remove a little over 2,200 diplomatic staff, foreign security staff and Afghans who worked for embassies,” the Western security official said.

It was unclear when civilian flights would resume, he said.

The Taliban, fighting since their 2001 ouster to expel foreign forces, seized Kabul on Sunday after a lightning offensive as US-led Western forces withdrew under a deal that included a Taliban promise not to attack them as they leave.

US forces running the airport had to stop flights on Monday after thousands of frightened Afghans swamped the facility looking for a flight out. Flights resumed on Tuesday as the situation came under control.