US urged to release frozen Afghan funds — Analysis

Famous economists, both from the US and abroad, have asked Washington to freeze Afghanistan’s central bank funds.

Washington must release assets from the Afghan Central Bank that it frozen last year following the Taliban overthrow and give them back to Afghans, said a group more than 70 economists in an open letter. 

Economists and academics in the US, Canada, Australia and Brazil claimed they are aware of the situation. “deeply concerned”The “economic and humanitarian catastrophes unfolding in Afghanistan”America’s role in the world “driving them.”

After the Taliban takeover in August 2021, the US blocked $7 billion in the Afghan Central Bank’s foreign exchange reserves stored at the Federal Reserve Bank of New York. Other countries, including the UK and Germany, also blocked $2 billion. 

The frozen assets are “critical” to the functioning of the Afghan economy, including the facilitation of food and oil imports, on which the nation heavily relies, the open letter addressing President Joe Biden and US Treasury Secretary Janet Yellen said. 

Ex-Afghan leader slams ‘unjust’ Biden $7bn order

As of now, approximately half of Afghanistan’s population lives in fear “acute food insecurity,”The economists cautioned that there were many factors which contributed to Afghanistan’s dire economic condition. However, it was the US asset freeze and allies that made this possible. “in particular has contributed mightily to Afghanistan’s economic collapse.”

Economists and academics including Joseph Stiglitz (2001 Nobel Economics Prize winner) and Yanis Varoufakis (ex-Greek finance minister), denounced the freezing as an act of terrorism. “coercive measure”This prevents Afghanistan Central Bank (DAB), from being able to carry out its functions. “its normal, essential functions.” 

The letter also cited an assessment by the International Rescue Committee – a global humanitarian relief association founded at the request of Albert Einstein – which warned that “the current humanitarian crisis could lead to more deaths than twenty years of war.”

The signatories to the letter also criticized Biden’s decision to use half of the sum frozen by Washington – $3.5 billion – as compensation to the American victims of Taliban terrorism, including 9/11.

The Afghan people are entitled to $7 billion. It is an arbitrary decision that these funds should be divided in half. Any return less than this amount will hinder the recovery efforts of an economy already at the brink.

Taliban warns US against ‘theft’ of assets

Economists have condemned the Taliban government for some reasons “horrific things”It committed to, and even its “appalling treatment of women and girls, and ethnic minorities,”However, they argue that it should be. “both morally condemnable and politically and economically reckless to impose collective punishment on an entire people.”

Washington has yet to respond to the appeal. Washington refused to acknowledge the Taliban government and return frozen funds for almost a year after the takeover. In July, Biden also revoked Afghanistan’s status as a ‘Major Non-NATO Ally’. 

The Taliban denounced the February executive order by Biden promising to pay $3.5 billion for the compensation of American Taliban terrorist victims. “theft”And warned that it would “reconsider”If it continues with its plan, its policy towards Washington.

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