mcloudyn.png
Thursday December 8th, 2022 3:59AM

US sets up Afghan relief fund with frozen central bank money

By The Associated Press

WASHINGTON (AP) — A year after the tumultuous U.S. withdrawal from Afghanistan, the Biden administration said Wednesday it will transfer $3.5 billion in frozen Afghan central bank funds to benefit the Afghan people, as hunger grips every province there.

Funds will be dispersed after trustees of the new Afghan Fund meet to determine a timetable. The trustees are two Afghan economists, a U.S. government representative and a Swiss government representative.

Notably, the Taliban government will not have access to the fund, which will be held at the Bank for International Settlements in Switzerland. The bank in a news release said its role is “limited to providing banking services to and executing the instructions of the Board of Trustees of the Fund without involvement in the Fund’s governance or decision making.”

In the interim, Afghanistan's central bank, which in February had $7 billion in frozen funds, “must demonstrate that it has the expertise, capacity, and independence to responsibly perform the duties of a central bank,” the U.S. Treasury and State departments said in a joint statement. “Robust safeguards have been put in place to prevent the funds from being used for illicit activity."

International funding to Afghanistan was suspended and billions of dollars of the country’s assets abroad, mostly in the United States, were frozen after the Taliban took control of the country in August 2021 following the U.S. military's withdrawal.

The World Bank says income and economic output in Afghanistan have dropped between 20% and 30%, imports have declined by roughly 40%, and 70% of Afghan households report they are unable to fully meet basic food or non-food needs.

In February, President Joe Biden issued an executive order that called for banks to provide $3.5 billion of the frozen money to a trust fund for distribution through humanitarian groups for Afghan relief and basic needs.

The other $3.5 billion will stay in the U.S. to finance payments from lawsuits by U.S. victims of terrorism that are still working their way through the courts, prompted by claims brought by family members of people killed on Sept 11, 2001.

“The Afghan Fund will help mitigate the economic challenges facing Afghanistan while protecting and preserving $3.5 billion in reserves from Da Afghanistan Bank (DAB), Afghanistan’s central bank, for the benefit of the people of Afghanistan,” Treasury Deputy Secretary Wally Adeyemo said.

He said the Taliban’s “repression and economic mismanagement” had exacerbated longstanding economic challenges for Afghanistan that had made the return of the funds untenable.

In a Tuesday letter to Afghanistan’s central bank, Adeyemo said until conditions for the central bank are met, their control of assets “would place them at unacceptable risk and jeopardize them as a source of support for the Afghan people.”

Shah Mehrabi, a Montgomery College economics professor, is one of the trustees of the new fund. He told The Associated Press that the money should be used primarily to maintain price stability in the country, rather than for humanitarian purposes.

“I think the purpose of board, as a member, is to address the liquidity and price stability issues in the country expeditiously, prior to a harsh winter,” he said. “There are ways we can provide relief so that Afghans are able to have food and energy and to perform their basic daily duties.”

Human Rights Watch said in August that Afghanistan’s humanitarian crisis cannot be effectively addressed unless the U.S. and other governments ease restrictions on the country’s banking sector to allow economic activity and humanitarian aid.

Nearly half the Afghan population — 18.9 million people — is estimated to be acutely food insecure between June and November 2022, the World Food Programme said. All 34 provinces in the country are facing some level of crisis or emergency levels of acute food insecurity.

Deputy Secretary of State Wendy Sherman said the people of Afghanistan are facing humanitarian and economic crises born of “decades of conflict, severe drought, COVID-19, and endemic corruption.”

“Today, the United States and its partners take an important, concrete step forward in ensuring that additional resources can be brought to bear to reduce suffering and improve economic stability for the people of Afghanistan while continuing to hold the Taliban accountable,” Sherman said.

  • Associated Categories: Associated Press (AP), AP Online Headlines - Washington, AP World News, AP Business, AP Business - Economy, AP Business - Industries, AP Business - Financial Services
© Copyright 2022 AccessWDUN.com
All rights reserved. This material may not be published, broadcast, rewritten, or redistributed without permission.
Procession of Queen Elizabeth II's coffin underway in London
Queen Elizabeth II has left Buckingham Palace for the last time
9:25AM ( 19 minutes ago )
Lin-Manuel Miranda, others seek Puerto Rico silver lining
Hurricane Maria devastated Puerto Rico five years ago and highlighted the funding problems the Caribbean island has long faced
9:18AM ( 26 minutes ago )
Energy crisis: EU chief wants to tap excess producer profits
European Commission President Ursula von der Leyen wants to cap the revenue of electricity producers that are making extraordinary profits because of the effects of the war in Ukraine and climate change
9:11AM ( 34 minutes ago )
Associated Press (AP)
EU moves to ban products made with forced labor
The European Union has unveiled plans to ban products made with forced labor from the 27-nation bloc’s markets
8:27AM ( 1 hour ago )
German government could raise stake in gas supplier Uniper
German energy supplier Uniper says it is exploring the possibility of the government acquiring a majority holding in the company as its losses mount
8:13AM ( 1 hour ago )
Car guy Biden to tout electric vehicles at Detroit auto show
President Joe Biden will showcase his administration’s efforts to promote electric vehicles during a visit to the Detroit auto show
8:05AM ( 1 hour ago )
AP Business
Authorities say a rail strike would be an "economic disaster"
Freight railroads and their unions are facing increasing pressure from business groups and the White House to settle their contract dispute
6:00AM ( 3 hours ago )
World shares fall, tracking Wall St dismay over price data
World markets have slipped after Wall Street fell the most since June 2020 as a report showed inflation has kept a surprisingly strong grip on the U.S. economy
4:57AM ( 4 hours ago )
Rhode Island Gov. McKee narrowly wins Democratic primary
Rhode Island Gov. Dan McKee eked out a victory in his Democratic primary on Tuesday, beating back strong challenges from a pair of opponents as he seeks his first full term in office
11:57PM ( 9 hours ago )
AP Business - Economy
Armed woman breaks into Beirut bank, takes trapped savings
Eyewitnesses say an armed woman and a dozen activists broke into a Beirut bank branch and took more than $13,000 from her trapped savings
5:46AM ( 3 hours ago )
China's Xi visits Kazakhstan ahead of summit with Putin
Chinese President Xi Jinping has started his first foreign trip abroad since the outbreak of the pandemic
5:16AM ( 4 hours ago )
EU chief proposes electricity market reform, revenue cap
European Commission President Ursula von der Leyen wants to cap the revenues of electricity producing companies that are making extraordinary profits due to the war in Ukraine and climate change
3:59AM ( 5 hours ago )
AP Business - Industries
Global stocks gain ahead of US inflation report
Global stocks and Wall Street futures are higher ahead of data traders hope will show that surging U.S. inflation eased in August, reducing pressure for more interest rate hikes
5:09AM ( 1 day ago )
Asian stocks gain ahead of US inflation report
Asian stocks have followed Wall Street higher ahead of data traders hope will show surging U.S. inflation eased in August, reducing pressure for more interest rate hikes
2:32AM ( 1 day ago )
Dubai court rejects Danish extradition request for financier
An Emirati court has ruled that a British man suspected of masterminding a $1.7 billion tax scheme cannot be extradited to Denmark to face charges
9:40PM ( 1 day ago )
AP Business - Financial Services
Procession of Queen Elizabeth II's coffin underway in London
Queen Elizabeth II has left Buckingham Palace for the last time
9:25AM ( 20 minutes ago )
Lin-Manuel Miranda, others seek Puerto Rico silver lining
Hurricane Maria devastated Puerto Rico five years ago and highlighted the funding problems the Caribbean island has long faced
9:18AM ( 27 minutes ago )
Energy crisis: EU chief wants to tap excess producer profits
European Commission President Ursula von der Leyen wants to cap the revenue of electricity producers that are making extraordinary profits because of the effects of the war in Ukraine and climate change
9:11AM ( 34 minutes ago )
Jim Beam outlines expansion to ramp up bourbon production
Jim Beam plans to ramp up bourbon production at its largest Kentucky distillery
9:01AM ( 44 minutes ago )
Huge line to view monarch's coffin is queue fit for a queen
Britons famously love to line up, but marshaling hundreds of thousands of people who want to view the coffin of Queen Elizabeth II will test Britain’s famous capacity for queuing to its limit
9:00AM ( 45 minutes ago )