BIDEN’S Treasury Department announced Wednesday it had created a fund to help the people of Afghanistan to “mitigate the economic challenges” facing the country as a result of the Taliban’s coming to power a year ago.
The Treasury said in a statement that they would not be a part of the fund, and “robust safeguards” have been put in place to prevent the money from being used for illicit activities.
“The Taliban’s repression and economic mismanagement have exacerbated longstanding economic challenges for Afghanistan, including through actions that have diminished the capacity of key Afghan economic institutions,” said Deputy Secretary of the Treasury Wally Adeyemo.
US President Joe Biden signed an executive order that will allow $3.5 billion of the Afghan central bank’s reserves to be used for the benefit of the people of Afghanistan, while “keeping them out of the hands of the Taliban and other malign actors,” according to the statement.
The Afghan Fund will maintain its account with the Swiss-based Bank for International Settlements (BIS) and protect, preserve and make specific disbursements to help provide greater stability to the Afghan economy.
“The people of Afghanistan face humanitarian and economic crises born of decades of conflict, severe drought, COVID-19, and endemic corruption,” said Deputy Secretary of State Wendy Sherman.
According to the World Bank, since the Taliban came to power, income and economic output in Afghanistan have fallen by 20-30 percent, while imports have declined by about 40 percent and about 70 percent of Afghan households are unable to fully meet basic food or non-food requirements.
Disbursements from the Afghan Fund would, for instance, enable Afghanistan to keep up with its debt payments to international financial institutions, thus preserving its eligibility for development assistance and payment of critical imports.