Taliban fighting losing battle to keep Afghanistan’s economy running

With Afghanistan facing a severe cash crunch, migration crisis and mass starvation, the Taliban government is pressing for the release of billions of dollars from its central bank reserves.

Afghanistan has parked billions of dollars in assets overseas with central banks in Europe as well as with the U.S. Federal Reserve. That money has however been frozen following the terrorist regime taking over Kabul in August.

A spokesman for the Taliban’s finance ministry said, the government would respect human rights, including education of women, as he sought fresh funds on top of humanitarian aid.

In 1996 to 2001, when the Taliban had captured power in Afghanistan, women had to face severe hardships, including being barred from paid employment, barred from getting educated, forced to cover from head to toe and be accompanied by a male relative when they leave home.

“The money belongs to the Afghan nation. Just give us our own money,” said Ahmad Wali Haqmal, a spokesman for the Taliban’s finance ministry. “Freezing this money is unethical and is against all international laws and values.”

“The situation is desperate and the amount of cash is dwindling,” said Shah Mehrabi, a member of the board of the Afghan Central Bank. “There is enough right now … to keep Afghanistan going until the end of the year. Europe is going to be affected most severely, if Afghanistan does not get access to this money”.

“You will have a double whammy of not being able to find bread and not being able to afford it. People will be desperate. They are going to go to Europe,” said Mehrabi.

The disorganized departure of the United States from Afghanistan, along with many international donors, has led to dire straits of the country’s already fragile economy.

The finance ministry said it had a daily tax take of roughly 400 million Afghanis ($4.4 million).

While most countries want to avert a humanitarian disaster in Afghanistan, they have so far refused to officially recognise the Taliban government.

The United States has made it clear that it will not release around $9 billion parked at the Federal Reserves.

Afghanistan needed $150 million each month to “prevent imminent crisis”, said Mehrabi.

He went on to add, “If reserves remain frozen, Afghan importers will not be able to pay for their shipments, banks will start to collapse, food will be become scarce, grocery stores will be empty”.

$431 million of Afghanistan’s central bank are held with Germany’s Commerzbank, as well as a further $94 million with Germany’s central bank.

The Bank for International Settlements, an umbrella group for global central banks in Switzerland, holds a further approximately $660 million.

All three banks declined comment.

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