English News

  • youtube
  • facebook
  • twitter

After IMF, World Bank too halts funding for Afghanistan in major blow to Taliban

After IMF, World Bank too halts funding for Afghanistan in major blow to Taliban

The World Bank has halted funding for projects in Afghanistan in what comes as a major blow to the Taliban leadership a few days after the International Monetary Fund (IMF) suspended payments to the country.

The decision has been made public after the World Bank evacuated its Kabul-based staff and their immediate families to Islamabad in Pakistan.

The World Bank said the step has been taken over concerns as to how the Taliban's takeover will impact "the country's development prospects, especially for women".

Since 2002 the Washington-based multilateral financial institution has committed more than $5.3bn to reconstruction and development projects in Afghanistan.

Also read:  War-torn Afghanistan poses hidden challenge to the Taliban–acute food crisis amid droughts

"We have paused disbursements in our operations in Afghanistan and we are closely monitoring and assessing the situation in line with our internal policies and procedures," a World Bank spokesperson told the BBC.

"We will continue to consult closely with the international community and development partners. Together with our partners we are exploring ways we can remain engaged to preserve hard-won development gains and continue to support the people of Afghanistan."

Last week, the IMF announced that Afghanistan will no longer be able to access the its resources which come in the form of short term loans to meet payments for international trade.

About $440 million of new monetary reserves had been set to be made available to the country from 23 August. The move has hit the Afghanistan economy hard as it is desperately short of dollars.

An IMF spokesperson said it was due to "lack of clarity within the international community" over recognising a government in Afghanistan.

Also in the days after the Taliban took control of Kabul, the White House said any assets that Afghanistan's central bank has in the US would not be made available to the Taliban.

Afghanistan’s central bank has reserves to the tune of $9 billion, most of which is held in the US and have been frozen as the Taliban leadership which seized power through military means has not been recognised.

The chief of Afghanistan's central bank, Ajmal Ahmady, has fled Kabul and blamed ousted President Ashraf Ghani and his advisors for the country's stunning fall into the hands of the Taliban in a matter of days. 

Afghanistan’s  Central Bank chief Ajmal Ahmady fled Kabul in a military plane on Sunday when the Taliban were still on the outskirts of the city, tweeted: He disclosed that Da Afghanistan Bank (DAB) had around $9 billion in reserves, but most of that is held in banks overseas, out of reach of the Taliban.

"As per international standards, most assets are held in safe, liquid assets such as treasuries and gold," he explained.

Ahmady said the US Federal Reserve holds $7 billion of the country's reserves, including $1.2 billion in gold, while the rest is held in international accounts including the Basel-based Bank for International Settlements.

In a string of Twitter messages, the 43-year-old Ahmady also said that US dollar supplies were dwindling and described how he escaped from Kabul on board a military plane as the commercial flight he had booked was already crowded with desperate flyers.