World Bank halts its financial assistance to Afghanistan

The news is another another setback for Afghanistan’s economy, which is highly reliant on foreign help.

NEW DELHI According to CNN, the World Bank said Tuesday that it is suspending financial assistance to Afghanistan due to concerns over the plight of women under Taliban control.

The Afghan economy is increasingly reliant on foreign aid, and food costs are growing.

World Bank cites women’s safety for halting aid

In a statement to CNN Business, World Bank spokesman Marcela Sanchez-Bender stated that they are profoundly worried about the situation in Afghanistan and the impact on the country’s development prospects, particularly for women.

According to the World Bank’s website, the institution has invested more than $5.3 billion to development initiatives in Afghanistan. The World Bank-managed Afghanistan Reconstruction Trust Fund has raised more than $12.9 billion.

‘World Bank is actively monitoring the Afghanistan situation’

Sanchez-Bender further added that they have suspended disbursements in its activities in Afghanistan and are actively monitoring and reviewing the situation in accordance with its internal standards and procedures.

The World Bank has stated that it will continue to consult with international organizations and development partners.

US Treasury lobbied for stopping the aid

Due to a lack of clarity regarding the country’s administration after the Taliban took control of Kabul, the International Monetary Fund has stopped Afghanistan’s access to IMF resources, including about $440 million in new monetary reserves, according to Reuters.

The IMF’s announcement came amid pressure from the US Treasury, which owns a controlling stake in the organisation, to ensure that Afghanistan’s share of an SDR reserve distribution due for Monday does not slip into Taliban hands.

The fund has generally depended on its membership to decide whether to participate with governments that take power in coups or contested elections, according to the Reuters report.

According to Reuters, even if Afghanistan regained access to the SDRs, the Taliban would be unlikely to spend them because doing so would require another country to be willing to exchange the SDRs for underlying currencies, a transaction that would most likely be blocked by long-standing US financial sanctions against the Taliban.

Aasif Ganaie

Aasif is a journalist and a news enthusiast based in Jammu & Kashmir. He voyages to explore and uncover the stories More »
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