“We assembled a group of regulatory experts, financial sector experts, and people in new financial technologies, to think, what are some of the alternative ways of handling this? The first was to establish a risk management framework regarding Afghanistan as a jurisdiction. One was sort of half-solved by the administration’s announcement today that there will be ongoing litigation regarding central bank assets and the second being that the State Department’s designation of the Taliban as a terrorist organization is going nowhere." “We were approached in December by a group of humanitarian organizations and foreign governments saying: ‘we need to put our heads together and think about what are the alternative ways of delivering liquidity to the country?’ And there were two premises there. Then the third shock, when the Taliban regime begins when the Taliban took over Kabul and the US government froze the foreign exchange reserve." So, the concern of all businessmen and women is sorted and they started to transfer their deposits from banks in Afghanistan to their accounts overseas. The second shock, that was when the previous government lost control of key provinces in Afghanistan. As a consequence, for some banks in Afghanistan-due to delays in loan repayments and also increase in NPA- their profitability was badly impacted. The first shock was when covid had spread in 2020. "The banking sector in Afghanistan has already experienced three shocks. The deposits from the bank are still shrinking and the availability of cash in the vault of the bank has decreased consequently.” The exchange rate continues to depreciate against the US dollar and all foreign currencies. Wages and demand for labor continues to decline, the skilled government and private sector employees are still leaving the country, which has created a significant challenge. As gradual deterioration and economic conditions continues, overall inflation is being driven by increasing prices of basic household goods. “The situation remains particularly difficult. This event convened a group of experts to provide concrete, actionable policy recommendations on how to respond-before it’s too late. What can the United States and the international community do to bring more lasting relief to Afghans and stave off economic collapse, while also minimizing the risks of money ending up in Taliban hands? While the international community has pledged millions of dollars in humanitarian aid, this critical assistance doesn’t do enough to ease Afghanistan’s severe economic stress and banking crisis. Sanctions on the Taliban regime and a freeze on Afghan assets abroad have produced an acute liquidity crisis, with little money entering the country. Nearly six months after the Taliban takeover in Afghanistan, the country’s economy is close to collapse. Careers, Fellowships, and Internships Open/Close.Wahba Institute for Strategic Competition.Science and Technology Innovation Program.Refugee and Forced Displacement Initiative.The Middle East and North Africa Workforce Development Initiative.Kissinger Institute on China and the United States.Nuclear Proliferation International History Project.North Korea International Documentation Project.Environmental Change and Security Program.Hyundai Motor-Korea Foundation Center for Korean History and Public Policy.
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