US allows transactions with Afghan govt despite sanctions

Author: Monitoring Desk

The United States on Friday issued new rules that would allow most commercial and financial transactions with Afghanistan while maintaining sanctions against the Taliban, in an effort to ease the flow of humanitarian aid and kickstart the paralyzed economy. Non-governmental organizations and financial institutions have expressed concerns about running afoul of US sanctions targeting the Islamist hardliners in power in Kabul — but that has meant a near-halt to all economic activity.

The United Nations has warned that the country is facing a “devastating” humanitarian crisis, with more than half of the country’s population of roughly 38 million at risk of suffering food shortages.

“In light of this dire crisis, it is essential that we address concerns that sanctions inhibit commercial and financial activity,” Deputy Treasury Secretary Wally Adeyemo said in a statement announcing the measure. The Treasury said its latest so-called general license “authorizes, to the extent required, all transactions involving Afghanistan and its governing institutions that would otherwise be prohibited by US sanctions,” except those that would directly benefit the Taliban or the Haqqani network.

Such transactions include dealings with government ministries, infrastructure maintenance or development projects, and business with state-owned companies, according to a Treasury fact sheet.

“The license will ensure that US sanctions do not stand in the way of transactions and activities needed to provide aid and support the basic human needs of the people of Afghanistan,” a senior administration official told reporters on condition of anonymity ahead of the license’s release.

A second senior official, also speaking on condition of anonymity, said: “There are too many Afghans starving today, too many Afghans that are cold. We all need to act faster.”

International aid had represented 40 percent of Afghanistan’s GDP and financed 80 percent of its budget. The United States has issued several rounds of humanitarian aid exemptions to sanctions since the Taliban takeover in August 2021.

Earlier this month, President Joe Biden seized $7 billion in assets belonging to the previous Afghan government, aiming to split the funds between desperately needed aid for Afghans and, controversially, eventual judgments in favor of victims of the 9/11 attacks.