US eases restrictions on funds transfer to Afghanistan

Published February 5, 2022
Women walk along a road at the Khwaja Koza Gar area in Herat on Friday. — AFP
Women walk along a road at the Khwaja Koza Gar area in Herat on Friday. — AFP

WASHINGTON: In a major move towards easing restrictions on Afghanistan, the United States has now decided to allow international banks to transfer money to the country for humanitarian purposes.

A directive issued by the US Department of Treasury earlier this week also allows aid groups to pay teachers and healthcare workers at state-run institutions without the fear of breaching US sanctions on the Taliban.

“Both US and non-US companies can ship food to Afghanistan, and banks can process financial transfers and other transactions associated with food shipments to Afghanistan,” said the directive issued in Washington.

The Treasury also outlined permitted transactions involving the Taliban, which includes the blacklisted Haqqani Network.

These include signing agreements to provide aid directly to the Afghan people, general aid coordination, including import administration, and sharing of office space.

“Payments of taxes, fees, or import duties to, or the purchase or receipt of permits, licences, or public utility services from” the Taliban, Haqqani Network or any entity in which they own more than 50 per cent is authorised for humanitarian operations, the directive said.

It explained that “US sanctions do not specifically prohibit the exportation or re-exportation of agricultural commodities, medicine, and medical devices to Afghanistan”.

The Treasury’s Office of Foreign Assets Control also issued a general licence, which authorises “US persons to engage in all transactions that are ordinarily incident and necessary to the exportation or re-exportation of agricultural commodities, medicine, medical devices, replacement parts, and components for medical devices, or software updates for medical devices to Afghanistan”.

The directive, known as GL 15, allows persons in third countries as well to purchase these items specifically for resale to Afghanistan. Non-US persons may engage in or facilitate transactions that would be authorised for US persons under GL 15.

GL 15 also authorises US persons to engage in transactions or activities that are ordinarily incidental and necessary to authorised exports or re-exports, including the processing of financial transactions and related clearing and settlement involving privately-owned and state-owned banks in Afghanistan.

The United States froze about $9.5 billion of Afghan assets after the fall of Kabul in August last to prevent the Taliban from accessing them. The frozen Afghan assets are the second-largest seized by the US since the Iranian assets frozen in the 1980s.

Last week, UN Secretary General António Guterres reiterated his appeal for a conditional release of the frozen funds with a warning that Afghanistan was “hanging by a thread”.

“Babies being sold to feed their siblings. Freezing health facilities overflowing with malnourished children. People burn their possessions to keep warm. Livelihoods across the country have been lost,” he said.

Published in Dawn, February 5th, 2022

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