Tuesday, 29 November, 2022
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Joe Biden’s decision to command & split Afghanistan’s forex is a $7 billion betrayal

Biden has begun releasing the $7 bn Afghan Central Bank funds held in US Fed. His plan proposes to split it. The problem is, the US doesn’t own that money: Afghanistan does.

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Out of all the actions the Biden Administration could have taken on Afghanistan, commandeering the nation’s foreign currency reserves is, to put it mildly, unhelpful.

In an executive order signed Friday, President Joe Biden began the process of releasing the $7 billion in Afghan Central Bank funds held in the Federal Reserve. It froze those assets last August when the Taliban seized control of Afghanistan as American and NATO forces withdrew. His plan proposes directing $3.5 billion into a trust fund for humanitarian assistance to Afghanistan while putting the other $3.5 billion aside for families of victims of the Sept. 11, 2001 attacks on the U.S.

The problem is, the U.S. doesn’t own that money: Afghanistan does. That Washington doesn’t want to release billions to the Taliban is understandable. No one wants rivers of cash to go a regime that’s simply picked up where it left off two decades ago, restricting girls’ access to schools and universities, preventing women from working, abducting protesters and journalists from their homes and killing opponents.

But while the United Nations and other humanitarian groups work to convince the U.S. and the World Bank to ease what amounts to an economic blockade on Afghanistan, Biden’s actions are blatantly counterproductive.

With more than half of the country’s nearly 40 million people facing acute hunger and a million children at risk of dying amid a harsh winter, UN chief Antonio Guterres in January called on the World Bank to immediately release $1.2 billion in reconstruction funds to ease the humanitarian crisis and inject liquidity to prevent an economic collapse. It had already transferred $280 million to the UN Children’s Fund and the World Food Programme a month earlier.

But as many experts have pointed out, you cannot feed an entire country with aid.

“Aid cannot make up for an economy deprived of oxygen,” International Rescue Committee President and former U.K. Foreign Secretary David Miliband said in a statement to the Senate Foreign Relations Committee Subcommittee on Near East, South Asia, Central Asia and Counterterrorism on Feb. 9. “The humanitarian community did not choose the government, but that is no excuse to punish the people, and there is a middle course — to help the Afghan people without embracing the new government,” Miliband wrote.

Let’s remember, this entire crisis was triggered by the poorly planned U.S. withdrawal after two decades of war and what appears to be a complete lack of foresight about how to deal with the aftermath. In the uproar that followed Friday’s announcement, many in Afghanistan and its diaspora pointed out the obvious: This appears to be a backwards attempt to punish Afghanistan for its role in the 2001 attacks on the U.S. If so, the aim was off-target. Of the origins of the 9/11 hijackers, 15 came from Saudi Arabia, two from the United Arab Emirates and one each from Lebanon and Egypt. Not one was Afghan. The Taliban, who ruled most of the country, had provided refuge to Osama bin Laden; but, given the median age of Afghans today is 18, those attacks took place before many were even born.

As Obaidullah Baheer, a lecturer in transitional justice at the American University of Afghanistan, told the BBC, there is deep anger and frustration at the U.S. decision. The money underpins the Afghan currency and is not meant for aid, he noted. “Afghanistan needs a sustainable economy if it is to survive in the long run, and the federal reserves are fundamental to it.”

Meanwhile, the spokesman for the Taliban’s political office in Qatar, Mohammed Naeem, tweeted on Friday that the seizure of Da Afghanistan Bank’s reserves was “theft” and a sign of “moral decay.”

The U.S. and its allies have rightly demanded that the Taliban form a more inclusive government, guarantee the rights of women and ethnic minorities, allow girls to go to school and university and break ties with terrorist groups before any money is released.

But there are work-arounds to make sure an entire nation doesn’t slip into famine. As Human Rights Watch suggested on Feb. 11, the World Bank could require that all banking transactions are overseen by independent auditors to address concerns that providing the Afghan Central Bank with assets could enrich the Taliban.

If Biden’s plan is implemented, Human Rights Watch’s Asia Advocacy Adviser, John Sifton, wrote, it “would create a problematic precedent for commandeering sovereign wealth and do little to address underlying factors driving Afghanistan’s massive humanitarian crisis.” The entire $7 billion “already legally belonged to the Afghan people.”

Biden’s administration needs to urgently rethink its decision and show some political will to help Afghanistan out of a crisis it helped create. It’s the only right thing to do. – Bloomberg.

Also read: Karzai slams US decision of splitting funds, says USD 7 Billion assets belong to Afghan people


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