9 million people are on the brink of starvation. 1 million children could die of malnutrition.
Recently, the Biden administration moved to ease some commercial activity in Afghanistan, despite ongoing U.S. sanctions that have strangled Afghanistan’s economy and entrenched its civilians in a hunger crisis.
The Treasury Department issued a license that would expand the authorization of some commercial and financial transactions, easing existing U.S. sanctions. This includes permitting the payment of taxes, fees, import duties, as well as the purchase or receipt of permits, licenses, or public utility services for transactions that cover basic needs. It also allows for the lawful transfer of money for government workers. According to administration officials, restarting some of this commercial activity would help Afghans, but not the Taliban.
This comes amid an ongoing humanitarian emergency in Afghanistan, where 23 million Afghans — more than half of the country’s population — are facing a hunger crisis.
Almost 9 million people are at the brink of starvation. According to UNICEF, up to 1 million children are expected to suffer from extreme malnourishment, and could die without treatment. 13 million children will require humanitarian assistance due to lack of food, the spread of disease, water scarcity, lack of shelter sanitation services, and the economic consequences that have left Afghanistan ravaged. Millions of Afghan civilians are fleeing the country as refugees.
And while the recent move by the Biden administration to ease up on some of the sanctions will help Afghan civilians, it was those sanctions that have contributed to the economic plunge in the first place. And restrictions on Afghanistan’s central bank are still implemented, continuing to decimate the Afghan economy.
Because the United States does not recognize the Taliban, and designates the Taliban as a Specially Designated Terrorist Organization, any financial dealings with the Taliban are illegal. Therefore, Afghanistan has been sanctioned and cut off from the global financial system.
Economic sanctions are put in place for a multitude of reasons. Often they are used as an alternative to military warfare, used to apply pressure on individuals or states.
Some dispute the effectiveness of economic sanctions as a means to achieve a diplomatic goal, or argue their damage done to economies that cause stress and hardship on the civilian population. In many modern cases, U.S. sanctions have caused immense damage and suffering to civilian populations and done little to achieve any diplomatic goal.
After the Taliban took control of Afghanistan last August, the U.S. froze Afghanistan’s $7.1 billion in central bank reserves held in the New York Federal Reserve to prevent the Taliban from accessing them. Most of the foreign aid that has largely kept Afghanistan propped up has been frozen to comply with these sanctions.
Meanwhile, Afghanistan’s banks have been paralyzed. This has impeded trade, commercial activity, and caused Afghanistan’s economy to spiral. People no longer have access to the money in their banks, and the lack of liquidity in the central banking system has halted humanitarian aid from reaching desperate people. Government workers, including teachers, doctors, and nurses have not received paychecks for many months. And the afghani, Afghanistan’s currency, has plummeted in value, causing a spike in inflation. This has made it hard for civilians to purchase food and supplies, resulting in a massive health and hunger crisis.
While the Treasury Department has put out broad authorizations starting in September to facilitate aid to Afghanistan, and while the U.S. has worked with the United Nations to ensure that UN agencies and NGOs have the liquidity to support humanitarian programs, many financial institutions and humanitarian organizations remain fearful of violating existing sanctions, and have halted their funding. Since then, Afghanistan has plunged into an even worsened crisis as winter approached, the sanctions still in place.
A senior Democratic foreign policy aide, commenting anonymously to The Intercept, stated that this policy by the Biden administration “effectively amounts to mass murder.”
“[Biden] has had warnings from the UN Secretary General, the International Rescue Committee, and the Red Cross, with a unanimous consensus that the liquidity of the central bank is of paramount importance, and no amount of aid can compensate for the destruction of Afghanistan’s financial system and the whole macro economy,” commented the aide.
Other experts agree with this assessment, stating that if a country doesn’t have reserves or a functioning central bank, no amount of aid could make up for what is lost in an economic standstill.
In a letter to the Biden administration, the Congressional Progressive Caucus, chaired by Rep. Pramila Jayapal (D-WA) and made up of 96 U.S. congressmembers, urged for modifying the U.S. sanctions policy against Afghanistan, as well as unfreezing Afghanistan’s reserves held in New York.
“No increase in food and medical aid can compensate for the macroeconomic harm of soaring prices of basic commodities, a banking collapse, a balance-of-payments crisis, a freeze on civil servants’ salaries, and other severe consequences that are rippling throughout Afghan society, harming the most vulnerable,” the letter states.
While the Biden administration is now attempting to mitigate the harm done to Afghanistan’s economy and civilian population by lifting some sanctions, Afghanistan still does not have access to its central bank foreign reserves. And only weeks ago, the Biden administration put out an executive order to split the frozen assets of Afghanistan’s central bank held in New York — one half to be held in a trust fund to be used in unspecified humanitarian efforts to “for the benefit of the Afghan people”, the other half being seized and set aside for 9/11 families to pursue in court.
This seizure of funds will not only further cripple Afghanistan’s already paralyzed central bank, but will perpetuate even more civilian suffering. It has already contributed to soaring inflation, the closing of essential businesses, and commercial banks. The release of these assets is essential for the liquidity and basic functioning of Afghanistan’s economy.
“By denying international reserves to Afghanistan’s private sector — including more than $7 billion belonging to Afghanistan and deposited at the Federal Reserve — the U.S. government is impacting the general population,” the letter by the Congressional Progressive Caucus stated, “We fear, as aid groups do, that maintaining this policy could cause more civilian deaths in the coming year than were lost in 20 years of war.”
Human rights organizations, including Afghans For A Better Tomorrow, have also condemned this choice by the Biden administration.
“This decision is short-sighted, cruel, and will serve to worsen a catastrophe in progress, affecting millions of Afghans, many of whom are on the verge of starvation,” the organization said in a statement.
Members of Congress also called on the Biden administration to release these frozen assets to inject liquidity into the Afghan economy.
“Any functioning country must have access to its own currency and reserves,” stated Rep. Jayapal, “By removing and breaking up Afghanistan’s already frozen funds, the United States is continuing to contribute to a crumbling economy and devastating impacts on the Afghan people. More importantly, frozen assets belonging to the Afghan people should be released and used to restore the country’s economy.”
In order for Afghanistan to rebuild their economy and simply survive, not only should these assets be released, but the sanctions need to be lifted. Sanctions and the mistrust they cause in the global banking system have frozen these life-saving funds that keep both the economy and Afghan civilians alive.
“The humanitarian consequences of crippling the country’s financial system cannot be compensated with humanitarian aid deliveries,” Refugees International stated, “Instead, the administration should be taking measures to ensure the maintenance of banking and payments systems independent of Taliban control — and should have leveraged the funds in the Federal Reserve to achieve that outcome.”
Last month, UN Security General António Guterres told the Security Council that they should suspend the rules and conditions straining Afghanistan’s economy in order to assist the Afghan civilians. He called to increase liquidity into Afghanistan’s economy by freeing the reserves that are currently being held in the United States and elsewhere.
“Afghanistan is hanging by a thread,” he said.
Human rights experts at the UN have also pointed out that international financial institutions complying with the existing sanctions has created a currency shortage, severely impacting civilians. “The implementation of the current sanctions regime has been impeding the functioning and maintenance of infrastructure that is essential to ensure the population’s survival, and they are denying Afghans’ access to life-saving assistance despite the increasing needs related to the crisis,” they stated.
The sanctions in place will likely not harm the Taliban, nor will lifting them prop up or assist the Taliban. “Punitive economic policies will not weaken Taliban leaders, who will be shielded from the direst consequences, while the overwhelming impact of these measures will fall on innocent Afghans who have already suffered decades of war and poverty,” the Congressional Progressive Caucus stated.
While sanctions have been put in place as a coercive measure, or to “punish” governments by weakening their economies, it is the civilians of those countries that feel the strongest brunt of them.
In Venezuela, it is estimated that U.S. sanctions have caused an estimate of 40,000 civilian deaths, according to a report by the Center for Economic and Policy Research. Cutting Venezuela off from an international payment system deprived the country of access to essential imports of food and medicine, while also causing miles-long lines at gasoline pumps, disrupting ambulances, essential delivery of goods and services, and more. In Syria, the U.S. sanctions implemented by the Caesar Act in 2020 in an attempt to punish Bashar Al Assad’s government have instead greatly harmed Syria’s civilians. These sanctions have caused electricity and heating shortages, hospitals being deprived of supplies and equipment, and the forbidding of rebuilding housing and crucial infrastructure. And, as is true with most economic sanctions, international aid organizations fear sending aid and supplies to Syria in fear of violating those sanctions.
A similar grim picture is plaguing Afghanistan.
Afghanistan’s crippled economy has spiraled its people into an unprecedented hunger crisis. Their healthcare system is on the verge of collapse, and due to the ongoing U.S. sanctions, hospitals cannot access lifesaving funds in order to pay staff or purchase medicine.
“Most of our medicine, facilities and livelihood are provided by foreign countries,” a facility resident doctor told The New York Times last September, “We have no shortages in the hospital now, but our own facilities and personnel depend on funds coming from abroad and we can’t access them.”
Meanwhile, malnutrition wards in still-functioning hospitals are filling up with children, some hospitals bringing in 15 to 20 more babies a day. Children are brought in with wasted muscles, sagging skin, and are too weak to cry. Families cannot afford food, or wood for fire. Some families live on diets of scant bread and tea. Outbreaks of measles, dengue fever, diarrhea, malaria, and COVID-19 overburden hospitals. In January, Save the Children stated that malnourished children in hospitals has doubled since August, many of them dying before they could get to the hospital.
Without assistance, many of these children will die. And though some aid has been sent out, not enough is able to reach desperate people — especially with the restrictions and sanctions put in place.
The Biden administration easing on trade and other commercial transactions is necessary to undo the damage done by U.S. sanctions and restrictions on Afghanistan’s economy. But more must be done.
Even with assurances by the Biden administration, organizations that have funded humanitarian assistance have been hesitant to do so for fear of violating sanctions. This same fear and hesitation will exist until those sanctions are lifted. Furthermore, Afghanistan’s economy and civilians will continue to suffer until its frozen assets are released and Afghanistan’s central bank is able to operate freely and independently.
The lack of a functioning bank is paralyzing Afghanistan’s economy and preventing humanitarian aid and basic essentials from reaching desperate people. The United States and international community must inject cash liquidity into the Afghan economy, unfreeze the $7.1 billion in funds that belong to the Afghan people, and overhaul the current sanctions regime.
Until then, the Biden administration must also write “comfort letters” to international organizations to assure them that they will not violate sanctions by delivering aid to Afghanistan’s civilians.
The Biden administration should also work to urge the International Monetary Fund to unfreeze their funding for Afghanistan as well. The World Bank has also released $280 million in humanitarian funding for Afghanistan, but 80% of this funding is frozen. The U.S. can urge both the IMF and the World Bank to unfreeze this funding.
After 20 years of war in Afghanistan, the United States cannot further its legacy of harm and strangulation of the Afghan people. By lifting the current sanctions and allowing Afghanistan’s central bank to function independently, Afghanistan’s economy and civilians may be able to survive this winter and, hopefully, begin to rebuild.
“Afghans must survive the Taliban’s oppressive rule as well as endure America’s economic warfare,” commented Afghans for a Better Tomorrow in a statement, “They do not deserve to be punished twice.”