In Afghanistan, The Misery Continues

Many countries are holding meetings with banks, financial institutions and NGOs to clarify how to provide humanitarian aid to Afghanistan without breaching US or UN counterterror sanctions. The takeover of the country by the Taliban, which is internationally designated as a terrorist organisation, presents a legal minefield for charities trying to provide aid to the population.

The UN has imposed two sets of sanctions resolutions against more than 130 members of the Taliban – many now members of the government – and five Taliban “entities” including the entire Haqqani network. The US has long imposed broader sanctions on the Taliban as an organisation, raising questions about how banks or other financial channels can send aid into Afghanistan without risking falling foul of US Treasury penalties.

A senior UK Foreign Office official, said, it would be a complex task to find “safe, legal and transparent payment options into Afghanistan”.

Afghanistan’s population of 38 million people risks being plunged into near-universal poverty faced with a “catastrophic deterioration” of the country’s heavily aid-dependent economy, according to a warning issued by the United Nations Development Programme (UNDP). The study, which examines a series of scenarios facing the already impoverished country under the Taliban’s new hardline rule, suggests a worst-case scenario where as many as 97% of Afghans would sink below the poverty line by next year – a staggering increase of 25%.

UN Secretary-General Antonio Guterres pleaded with the international community to maintain a dialogue with the Taliban in Afghanistan, warning that an "economic collapse" with possibly millions dying must be avoided.

"We must maintain a dialogue with the Taliban, where we affirm our principles directly -- a dialogue with a feeling of solidarity with the Afghan people," he said. "Our duty is to extend our solidarity to a people who suffer greatly, where millions and millions risk dying of hunger," Guterres added.

Kanni Wignaraja, the UN assistant secretary general, explained, “We are facing a full-on development collapse on top of humanitarian and economic crises.” The report warns of the need to avert a “national implosion at all costs”.

“Half of the population is already in need of humanitarian support. This analysis suggests that we are on course for rapid, catastrophic deterioration in the lives of Afghanistan’s most vulnerable people. A transition to new authorities, a pandemic, a drought, an oncoming winter season – each of these on their own would already pose a major challenge. Taken together, they form a crisis that demands urgent action,” Wignaraja said.

Deborah Lyons, the UN special envoy to Afghanistan said, the freezing of funds in a bid to keep money out of the hands of the Taliban could end up causing a lot more harm to the people of Afghanistan. Lyons pointed out that if funding were to stop there would be "a severe economic downturn that could throw many more millions into poverty and hunger, may generate a massive wave of refugees from Afghanistan and indeed set Afghanistan back for generations."

An injection of money into Afghanistan is needed "to prevent a total breakdown of the economy and social order," Lyons said. Much of the Afghan central bank's assets are not held in the country and the Taliban is unable to access the International Monetary Fund's $440 million (€372,000) emergency reserve.

China's deputy UN ambassador Geng Shuang, said the US using the Afghan central banks assets as a bargaining chip is ultimately hurting the people of Afghanistan. "These assets belong to Afghanistan and should be used for Afghanistan, not as leverage for threats,"

The UNDP appraisal itself paints a grim picture, showing the worsening situation can only drive more people into displacement.

 It says: “Afghanistan is facing a financial crisis following the takeover, with much of the international aid that had propped up the economy frozen. With skyrocketing food prices and an interruption in economic activities and essential services, food insecurity is rising precipitously. The health status of much of the population, already compounded by Covid-19, is also of immediate concern. These ‘life shocks’ are felt hardest in poor urban and rural communities, where the most vulnerable are facing the unenviable choice of either finding a way to sustain their livelihoods while remaining in place or joining the large numbers already displaced.”

Even before the Taliban takeover, nearly half the population needed some humanitarian aid and more than half of all children under the age of 5 were expected to face acute malnutrition. Nearly 11 million people in Afghanistan, the almost one-third of the population, are already in desperate need as a result of drought, displacement, chronic poverty and a sharp increase in hostilities as the Taliban swept to power last month have pushed the country to the brink of economic collapse. A trickle of aid has been reaching the country, including from Pakistan and Qatar, since the Taliban took power, but with shortages of cash and some countries and institutions suspending aid, concern has been mounting rapidly. The Taliban’s current annual income, much of which is raised from taxation and criminal activities, is estimated to be somewhere between $300m and $1.5bn. While those funds bankrolled a successful insurgency, it is nowhere near meeting the needs of running a nation, experts say.

Most Afghans live on less than $2 a day, 80% of the country’s budget has been covered by international funds over the past 20 years, and no industries of note have emerged to provide employment to a mostly young population. Tens of thousands of Afghans have fled, most of them members of the educated professions, taking their much-needed knowledge and skills with them.

Afghans at risk of near-universal poverty, UN report warns | Global development | The Guardian