IMF stops funds to Afghanistan, reserves blocked from Taliban

IMF stops funds to Afghanistan, reserves blocked from Taliban

The International Monetary Fund (IMF) has announced it will block previously agreed assistance to Afghanistan following the collapse of the Ghani government.

A spokesperson for the Washington-based crisis lender on Wednesday said it had decided to withhold its assistance to Afghanistan amid uncertainty over the status of the leadership in Kabul.

The IMF approved a historic SDR456 billion (US$650 billion) loan to support global liquidity early August.

The Special Drawing Rights (SDR) are an international reserve asset created by the International Monetary Fund (IMF) to complement the official reserves of its member countries.

Due to the country’s large current deficit, the Afghanistan Central Bank (DAB) was scheduled to receive approximately $450 million in shipments on August 23rd.

The United States had earlier frozen approximately $9.5bn in Afghan Reserves.

Central bank governor Ajmal Ahmady in a series of tweets, said that the Central Bank vaults were empty, which is sure to cause a rise in inflation, currency depreciation and increase in food prices.

Ahmady who had earlier worked with the US Treasury and later the World Bank, was appointed Acting Governor of the Afghanistan Central Bank (DAB) last year.

The IMF had taken similar action against other regimes that have not been recognized by a significant mass of member nations, such as Venezuela.

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