IMF blocks Taliban access to $440 million funds over lack of government clarity

By Team Newsable | First Published Aug 19, 2021, 10:54 AM IST

The IMF has suspended Afghanistan's access to resources due to a lack of clarity over the country's government after the Taliban seized control.

The International Monetary Fund (IMF) on Wednesday said that it had suspended Afghanistan's access to resources, including around US$440 million (A$610 million) in new monetary reserves, over lack of clarity of the country's government after the Taliban gained control of the capital Kabul.

The decision comes off amid mounting pressure by the international community, including the US Treasury Department.

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"As is always the case, the IMF is guided by the views of the international community. There is currently a lack of clarity within the international community regarding recognition of a government in Afghanistan, as a consequence of which the country cannot access SDRs or other IMF resources," a spokesperson for the IMF said in a statement.

Also read: Afghan conflict: Several killed amid Taliban firing and stampede during Independence Day rally in Asadabad

A Treasury Department official said, the Biden administration was working to prevent the Taliban from getting the reserves.

The Fund traditionally relies on its members to decide whether to engage with governments that take power in coups or disputed elections.

Funded by its 190 member nations and the United States being the largest shareholder, carries significant weight in the say on Afghan crisis.

Also read: Taliban celebrates Afghanistan Independence Day amid rising conflict

The IMF in 2019 had suspended Venezuela's access to funds after over 50 member countries, representing a majority of the shareholders, denied to recognise President Nicolas Maduro's government following his disputed re-election.

The IMF has been in a difficult position as Taliban swiftly toppled Afghanistan’s government as former President Ashraf Ghani surrendered.

The European Union, Russia and Canada have said publicly that they are not ready to recognize the Taliban as the government in Afghanistan.

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