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Russia demands US to release Afghan reserves

Russian envoy to Afghanistan emphasises the need for the US to unfreeze Afghanistan's national reserves. Afghanistan is falling deeper in to a financial crisis seeing financial global institutions backing out from the region as well.

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Russia on Monday called on the United States to release Afghan central bank reserves that Washington blocked after the Taliban’s takeover of Kabul earlier this month.

“If our Western colleagues are actually worried about the fate of the Afghan people, then we must not create additional problems for them by freezing gold and foreign exchange reserves,” said the Kremlin’s envoy to Afghanistan Zamir Kabulov.

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The United States must urgently unfreeze these assets, he said on the state-run Rossiya 24 network, “to bolster the rate of the collapsing national currency”.

Kabulov added that without doing so the new Afghan authorities will turn to “the trafficking of illegal opiates” and “sell on the black market the weapons” abandoned by the Afghan army and the United States.

The Afghan central bank’s gross reserves totalled $9.4 billion at the end of April, according to the IMF. The majority of these funds are held outside of Afghanistan.

Washington has indicated that the Taliban will not have access to assets held in the United States, without specifying the total amount there.

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Afghanistan has long been the world’s largest producer of opium and heroin, with profits from the illicit trade helping fund the Taliban.

 

IMF and World Bank stop Aid to Afghanistan

IMF announced that it stopped aid flows to Afghanistan. An IMF spokesman said that “As is always the case, the IMF is guided by the views of the international community. There is currently a lack of clarity within the international community regarding recognition of a government in Afghanistan, as a consequence of which the country cannot access SDRs [special drawing rights] or other IMF resources.”

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World Bank spokesperson, Marcela Sanchez-Bender said, “We have paused disbursements in our operations in Afghanistan and we are closely monitoring and assessing the situation in line with our internal policies and procedures.”

The Afghan people are likely to be submerged in a humanitarian crisis that’ll take much longer to recover from. The little improvement it showed is now all washed. The Taliban are in a financial Gordon knot, and its illicit opium trade is not viable enough to strengthen its hold on governance.

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© AFP with inputs from GVS

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