U.S. Freezes Afghan Central Bank Assets

The United States has frozen Afghan central bank reserves in U.S. accounts, depriving the Taliban of billions of dollars.

"Any central bank assets the Afghan government have in the United States will not be made available to the Taliban," a U.S. administration official said on August 17.

The administration of President Joe Biden made the decision over the weekend as the Taliban seized the capital, Kabul, on August 15 following a blistering offensive that swept up cities and toppled the Western-backed government.

According to the International Monetary Fund, the Da Afghanistan Bank's gross reserves totaled $9.4 billion at the end of April.

Most of the reserves are believed to be held at the New York Federal Reserve Bank and other U.S. financial institutions. The assets include dollars, gold, and U.S. treasuries.

The Taliban is on the U.S. sanctions list, meaning they are likely to have difficulty accessing external funds unless Washington and its allies recognize the new government.

In addition to freezing assets, Washington could also block aid to Afghanistan from international lenders such as the International Monetary Fund and World Bank.

Afghanistan is one of the poorest countries in the world and is highly dependent on foreign aid, which has covered about three-quarters of the government budget, according to the World Bank.

With reporting by AFP, Bloomberg, and Reuters