Biden’s Decision on Frozen Funds Stokes Anger Among Afghans

A lot of Afghans expressed they were enraged by the decision taken by the Biden administration of diverting billions in frozen assets from the Afghan central bank to American families of 9/11 victims since Afghanistan rushes into severe economic disaster.

The step, which would effectively bankrupt the nation’s central bank, contributes to the increased friction that several Afghans have opined toward the U.S. since the withdrawal of forces that led up to the Taliban’s takeover of the nation in August.

On Saturday, Fazl Ahmad, a shopkeeper in Kabul, the capital, said “It is a cruel act and a betrayal of the rights of the Afghan people,” adding further “It is clear that the poor economic situation right now is due to the US economic constraints on Afghanistan.” 

$7 Billion Froze in Central Bank Assets

Following the Taliban took power, the Biden administration froze the approximately $7 billion in central bank assets that the now-dead Western-supported government had on deposit at the Federal Reserve Bank in New York, amid vagueness on who, if anyone, now had the legal rights to get access to the account.

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The Biden administration started a process on Friday, focused on allowing relatives of victims of September 11, 2001, terrorist attacks who have legal claims against the Taliban to pursue $3.5 billion of those assets. The Taliban gave shelter to Qaeda leaders who planned the September 11 attacks during the Taliban’s prior rule of Afghanistan.

The White House stated an approximately equal amount would be aimed toward humanitarian assistance for Afghanistan, which is going through one of the world’s worst humanitarian disasters. It stated in a statement, that the step was “designed to provide a path for the funds to reach the people of Afghanistan while keeping them out of the hands of the Taliban and malicious actors.”

But for most Afghans, the decision to lay half of the assets into American hands raised frustrations regarding the stranglehold that the U.S. has had on the nation’s financial system since it removed its troops.

Afghan Economy on the Edge of Disaster

For several months, the Afghan economy has rolled on the verge of catastrophe. The millions of dollars in assistance that gave a boost to the Western-supported government is sent, and American sanctions have harmed the banking system and restrained humanitarian organizations’ capacity to send assistance.

Since the humanitarian crisis has worsened, American officials have dealt with tough questions on how to fulfill their responsibilities to struggling Afghans without giving money to the hands of the Taliban.

But Afghans continuously claim that the United States policies have done little to punish the Taliban, whilst taking a distressing toll on millions of ordinary people.

Biden’s Decision on Frozen Funds
Biden’s Decision on Frozen Funds

In response to the White House’s announcement on Friday, 45-year-old Mohammadullah Khan, of Helmand Province said “Americans consider this punishing the Taliban, but it is punishing Afghans.”

Under the Western-supported government, Mr. Khan served for an American-financed nonprofit organization in the southern province. But following the Taliban took control, its financing disappeared as did Mr. Khan’s job. After six months, he still has no work and suffers to get food for his wife and six children.

Mr. Khan is one of the millions of Afghans with empty cupboards. According to the United Nations, three-fourths of Afghanistan’s population has jumped into extreme poverty, with 4.7 million people likely to suffer extreme malnutrition this year.

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40-year-old Haji Abdul Nafi, a shopkeeper in the city of Kandahar said “Life is getting worse day by day,” adding “We cannot earn money for a living, we cannot do business with other countries, we cannot import and export goods — we are almost cut off from the world.”

Mr. Nafi stated he was disheartened by the United States’ announcement on Friday. If American officials are concerned that issuing the funds to the central bank would lead to the Taliban boosting themselves, then the assets should have been kept frozen instead of being reallocated, he added.

Mr. Nafi said “This is our money, this does not belong to the Taliban,” adding “Giving billions of it to families of 9/11 victims would “break the hearts of millions of ordinary people in Afghanistan.”

On Saturday, the Afghan central bank, also popular as Da Afghanistan Bank, asked that the Biden administration changes over its decision. Some Taliban officials moved further in criticizing the step.

The police spokesman for Kabul, Khalid Zadran took to Twitter “The money frozen by the United States is the right of the Afghan people, and we will fight to get that right just like we did over the past 20 years.”

Human Rights Groups, Lawyers, and Financial Experts Also Criticized the Move

The decision by the White House gathered criticism from human rights groups, lawyers, and financial experts who cautioned that the decision could be the backbone for the nation’s central bank for years to come, disabling its capacity to set up monetary policy and handle the nation’s balance of payments.

Experts also stated the $3.5 billion kept aside for humanitarian aid would do little good except if the U.S. removed restrictions over the Afghan banking system that have blocked the flow of assistance into the nation.

In a statement, John Sifton, the Asia advocacy director at Human Rights Watch, said “The decision would create a problematic precedent for commandeering sovereign wealth and do little to address underlying factors driving Afghanistan’s massive humanitarian crisis.”

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Experts also warn that assistance can go just so far to save an economy from collapse.

On Saturday, at his office in Mandawi Bazaar, one of the oldest marketplaces in Kabul, Aqa Gul articulated distress. The owner of an import-export company, he stated that his business had been disturbed with the collapse of the banking system, for which he accused U.S. policies.

He said “The people of Afghanistan are already in a very bad economic situation,” adding “If the United States gives Afghanistan’s assets to others, the economy will only get worse.”

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