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Taliban set to face cash crunch as mints are now out of reach

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Taliban's Herculean task: fixing economy

Afghanistan’s economic battle will continue despite China’s assurance and initial assistance. Besides sanctions and freezing of bank accounts, the Taliban will not be in any position to print currency notes. Afghanistan’s currency notes – the Afghani are printed outside the country.

Ajmal Ahmady, former acting governor of Da Afghanistan Bank—the country’s central bank said that not only will “now, Afghanistan and DAB under the Taliban are likely to be treated as sanctioned entities by the rest of the world” but the central bank typically receives Afghanis from overseas currency printing firms.

Also read: Will hardline Taliban 2.0 survive a crumbling economy and infighting ?

“The bank expected 2 billion afghanis in small-denominated notes from a Polish currency company in August. It had also signed a contract with a French firm for the supply of another 100 billion afghanis for the following year. I am relatively certain that these deliveries cannot be made,” Ahmady wrote in his column in Bloomberg.

The country’s banks have run out of cash and due to the freezing of bank accounts, inflow of remittances has thinned down.

“People have little money left in their hands and they are refusing to use up the cash that is left with them,” an industry source who has been dealing with the Afghan business community prior to the fall of Kabul to Taliban, told India Narrative.

Also read: Haqqani empire feeding on extortion, kidnapping, drug trafficking and real estate steers Taliban government in Afghanistan

Sources also said that though the Taliban are looking at China for financial assistance, Beijing is unlikely to open its purses to aid the war-torn country at this juncture. Ahmady noted that very few companies will be willing to invest in the country’s businesses and natural resources due to the uncertainty and security threats.

The real challenge for the hardline Taliban government has just begun.