Despite repeated appeals, US denies possibility of unfreezing Afghan assets

The UN and several other countries including China have asked the US to release nearly USD 10 billion worth of Afghanistan’s frozen assets to help the Taliban government deal with the humanitarian situation

December 15, 2021 by Peoples Dispatch
US White House press secretary Jen Psaki in a press conference on December 14. (Photo: Tolo News)

US White House press secretary Jen Psaki clarified on Tuesday, December 14 said that the government has no plan to unfreeze Afghanistan’s assets. Psaki was responding to a public call by Afghanistan’s foreign minister Amir Khan Muttaqi made a day earlier to unfreeze the assets. 

The US government had announced a freeze of nearly USD 10 billion worth of Afghanistan’s assets days after the Taliban took over power in the country on August 15, claiming the possibility of misuse of the funds. It also severed all diplomatic relations with Afghanistan after the complete withdrawal of its troops on August 30. 

The Taliban government in Afghanistan, the UN, and several other governments, including China, have demanded that the US release the funds to facilitate necessary public expenditure in Afghanistan. 

Largely due to the lack of enough funds, the Afghan government has been solely dependent on foreign aid for carrying out necessary public works. It has also relied on aid provided by neighboring countries to avoid the imminent threat of famine and an impending humanitarian crisis in the country. 

Threat of humanitarian crisis

Due to wars and conflict as well as persistent droughts and the COVID-19 pandemic, Afghanistan’s domestic production of food grains and other necessary commodities has drastically declined. The UN has declared that the Afghan economy is on the verge of collapse. UN agencies have predicted near universal poverty in Afghanistan, with nearly three-fourths of the population dependent on food and other aid. 

Following the Taliban’s takeover, most countries suspended their engagement with the highly-aid dependent country, leaving millions to deal with issues like lack of basic amenities. This is despite repeated UN appeals to the world to keep engaging with the Afghan government to prevent a humanitarian crisis. 

Following the US freeze, the International Monetary Fund (IMF) also suspended Afghanistan’s access to around USD 400 million Special Drawing Rights (SDR) in August. 

Psaki claimed during the press conference that the funds are not released for a number of reasons, such as litigation filed by victims of the September 11, 2001 attacks in US courts. She did not explain how the funds are related to the victims of a terrorist attack twenty years ago. 

Reacting to Psaki’s comments, deputy prime minister in the Taliban government Mullah Abdul Ghani Baradar on Tuesday criticized the world’s silence on the US holding Afghan assets. He asserted that this money belongs to the people of Afghanistan who are facing economic distress. “When a country plunges into economic problems, it will not affect that country, but will affect other countries too,” he warned, Tolo news reported.

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