IMF says US has no plans to unfreeze Afghan financial reserves under Taliban rule

The United States has no plans to release Afghanistan financial reserves worth $9.5 billion anytime soon, Sputnik reported, citing International Monetary Fund (IMF). The announcement comes after Taliban spokesperson Suhail Shaheen, last month, urged the international community, especially the US to unfreeze Afghanistan's financial resources as the interim cabinet was "ready" to govern the war-torn nation. However, on Thursday IMF spokesperson Gerry Rice informed that the financial agency has no "further updates to provide on Afghanistan."

It is to be noted that in September, the IMF decided to halt fund supply to Afghanistan amidst rising political instability in the war-torn country. The decision was announced by Rice highlighting that the funds will remain suspended until there is clarity within the international community on recognition of the Taliban-led government.

"Our engagement with Afghanistan has been suspended until there is clarity within the international community on the recognition of the government. We are guided by the international community in terms of the recognition of the government in organisation and we don't have that," Gerry Rice said on 17 September.

Foreign Assistance to Afghanistan frozen after Taliban takeover

The Taliban seized control of Afghanistan on August 15, following this the country has been grappling with harrowing humanitarian and economic crises. The international communities refused to recognise the Taliban-led government due to its widespread engagement in violation of human rights and inefficiency to form an inclusive government. Lack of recognition based on international standards has also led the World Bank and IMF to suspend aid and disbursement of contingent funds to the war-torn country. In August, the US also stopped $9.5 billion reserves to the country's central bank, ANI reported citing New York Post. Besides, the Financial Task Force warned its 39 member nations to block Talibani assets.

However, Rice had said that IMF will allow the flow of remittances and small-scale transfers to assist Afghan refugees displaced in other countries. "For Afghanistan, the immediate focus should be on delivering humanitarian aid to the Afghan people currently facing severe economic hardship. The IMF stands ready to work with the international community in advocating for urgent actions to stall a looming humanitarian crisis," he had said.

Afghanistan on the brink of "universal poverty"

Following the lack of adequate funds and governance Afghanistan could plummet into serious poverty by 2022, United Nations Development Programme (UNDP) stated. Currently, the country is dwindling on the "brink of universal poverty," which requires an immediate economic response program to counter the ongoing crisis and restore normalcy in the lives of the most vulnerable populations. Additionally, blocked bank accounts and the ability to make small withdrawals have pushed the country towards catastrophic deterioration fuelled by rising unemployment and inflation. Moreover, Afghanistan is also grappling with the Covid-19 pandemic besides the driest drought this season.

With inputs from ANI

Image: @IMF_Twitter/AP