US Plans to Release Half of US$7 Billion Frozen in Afghanistan Funds

Photo Source: RMOl.ID

Washington, MINA – The US government plans to release half of the US$7 billion (more than Rp100 trillion) of Afghanistan’s central bank assets frozen in the US to help the Afghan people, pending a court decision.

Meanwhile holding the rest to meet lawsuits against the Taliban from victims of “terrorism,” the White House said on Friday, MEMO reported.

President Joe Biden signed an executive order declaring a national emergency in Afghanistan, which faces a deepening threat of economic collapse.

The move came hours before the US Department of Justice presented a plan to a federal judge on what to do with the frozen funds amid urgent calls from US lawmakers and the United Nations for the funds to be used to tackle the economic crisis in Afghanistan.

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Senior government officials said they would work to ensure access to $3.5 billion in assets to benefit the Afghan people.

They said Washington would set up a third-party trust in the coming months to manage the fund. But details are still being worked out on how the entity will be structured and how the funds can be used.

Washington froze Afghan funds held in the US following the Taliban’s takeover of power in August. But facing mounting pressure, the US says the money does not belong to the Taliban. The US is looking for a way to release funds without recognizing the Taliban.

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Biden’s new executive order requires US financial institutions to transfer all of Afghanistan’s central bank assets they now hold into a consolidated account with the Federal Reserve Bank of New York.

The New York Fed will conduct standard due diligence on any transfers of funds, officials said.

Afghanistan has another $2 billion in reserves held in countries including the UK, Germany, Switzerland and the United Arab Emirates. Most of the funds were also frozen.

US officials say they have been in touch with allies about their plans, but Washington was the first to offer a plan for how to use the frozen assets to help the Afghan people. (T/RE1)

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Mi’raj News Agency (MINA)