US to use half of $7bn frozen Afghan funds for 9/11 victims
Biden’s executive order requires US financial institutions to transfer any Afghan central bank assets that they hold into a new consolidated account at the Federal Reserve Bank of New York.
Why is the US unfreezing Afghan assets now?
Last month, a US judge gave the White House until Friday to draft a plan for how it wished to handle the billions in Afghan assets frozen in the United States.
Members of Congress and the United Nations had called on the administration to free up the funds to address Afghanistan’s extreme economic crisis.
Ahead of Friday’s announcement, one US government source told Reuters news agency that the Afghan funds would be released for “the benefit of the Afghan people and for Afghanistan’s future.”
Why were the Afghan central bank’s assets frozen?
Afghanistan’s central bank holdings in the US were frozen in August after the fall of Kabul to the Taliban. The Taliban’s rapid takeover of Afghanistan came after the chaotic US and NATO withdrawal from the country after nearly 20 years.
Almost 80% of the national budget for Afghanistan prior to the Taliban takeover came from the international community. With that funding absent, the country’s economy nosedived.
How have rights groups reacted?
The Biden administration’s move to divide Afghanistan’s frozen assets was met with sharp condemnation from rights organizations and Afghan advocates.
The US-based advocacy group, Afghans for a Better Tomorrow, said it was “outraged” by the move.
The decision to divvy up half of Afghanistan’s reserve funds to give to 9/11 victims’ families is “short-sighted, cruel, and will worsen a catastrophe in progress” in Afghanistan.
Addressing the victims’ families, the group urged for them to reconsider their litigation, saying the money “will not bring justice, but ensure more misery and death in Afghanistan.”
Human Rights Watch (HRW) warned that the US move could set “a problematic precedent.”
