The Treasury Department is taking steps to prevent the Taliban from accessing some $450 million in aid from the International Monetary Fund in the wake of the group’s takeover of Afghanistan, according to a department official.
The IMF, with U.S. backing, is issuing billions of dollars worth of new “special drawing rights,” a reserve asset that can be converted to government-backed money, to aid poorer countries. A portion of those assets was scheduled to be allocated to Afghanistan next week, an event that has generated urgent pushback from Republican lawmakers.
“The potential of the SDR allocation to provide nearly half a billion dollars in unconditional liquidity to a regime with a history of supporting terrorist actions against the United States and her allies is extremely concerning,” 17 House members said in a letter to Treasury Secretary Janet Yellen on Tuesday, calling on her to ensure the Taliban would not receive the aid.
The official’s confirmation that the department would seek to block the allocation to Afghanistan is the latest effort by the U.S. government to withhold financial resources from the Taliban to ratchet up pressure on the group amid a chaotic American withdrawal from the country. It also cut off access to Afghanistan’s central bank assets, roughly $7 billion of which are held at the U.S. Federal Reserve, according to the head of Da Afghanistan Bank, who fled Kabul earlier this week.
The decision to pause the allocation of special drawing rights to Afghanistan would have to be made by the IMF board, on which the U.S. and its allies have a controlling number of votes. In the past, the IMF has blocked aid to countries, such as Venezuela, when the board did not agree to recognize the government as legitimate.
An IMF spokesperson confirmed that, as of now, Afghanistan would not be able to receive the aid.
“As is always the case, the IMF is guided by the views of the international community,” an IMF spokesperson said in an email. “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 or other IMF resources.”
Ajmal Ahmady, the central bank head who left Kabul, said on Twitter that the U.S. halted shipments of physical dollars to Afghanistan last weekend, leading to fluctuations in the country’s own currency.
“I believe local banks have told customers that they cannot return their dollars – because [Da Afghanistan Bank] has not supplied banks with dollars,” he tweeted. “This is true. Not because funds have been stolen or being held in vault, but because all dollars are in international accounts that have been frozen.
“Taliban should note this was in no way the decision of DAB or its professional staff,” he added. “It is a direct result of US sanctions policy implemented by [Treasury‘s Office of Foreign Assets Control].”
He said the Taliban would likely be able to access only 0.1 percent to 0.2 percent of the central bank’s international reserves, which are worth about $9 billion total. “Not much,” he said.