Some $7 billion of the Afghan central bank’s assets frozen in the U.S. banking system appears now to be permanently forfeited to the United States as President Joe Biden is set to announce its deployment to other uses.
According to Reuters sources, Biden is expected to issue an executive order on Friday to use the fund for humanitarian relief in Afghanistan and compensate victims of the Sept. 11, 2001, attacks.
The order will require U.S. financial institutions to facilitate access to $3.5 billion of assets for Afghan relief and basic needs.
The other $3.5 billion would remain in the United States and be used to fund ongoing litigation by U.S. victims of terrorism, the official said.
The official spoke on the condition of anonymity because the decision had not been formally announced.
International funding to Afghanistan was suspended and billions of dollars of the country’s assets abroad, mostly in the United States, were frozen after the Taliban took control of the country in mid-August.
The country’s long-troubled economy has been in a tailspin since the Taliban takeover.
Nearly 80% of Afghanistan’s previous government’s budget came from the international community.
That money, now cut off, financed hospitals, schools, factories and government ministries.
Desperation for such basic necessities has been further exacerbated by the COVID-19 pandemic as well as health care shortages, drought and malnutrition.
The lack of funding has led to increased poverty, and aid groups have warned of a looming humanitarian catastrophe.
State employees, from doctors to teachers and administrative civil servants, haven’t been paid in months.
Banks, meanwhile, have restricted how much money account holders can withdraw.
The official noted that U.S. courts where 9/11 victims have filed claims against the Taliban will also have to take action for the victims to be compensated.
The Justice Department had signalled several months ago that the Biden administration was poised to intervene in a federal lawsuit filed by 9/11 victims and families of victims in New York City by filing what’s known as a “statement of interest.”
The deadline for that filing had been pushed back until Friday because the department said the administration needed to resolve “many complex and important” issues that required consultation with “numerous senior officials and executive agencies and components.”
The executive order is expected to be signed by Biden later on Friday. The New York Times first reported on the coming order.
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