A Republican congressman on Friday introduced legislation aimed at blocking the Taliban in Afghanistan from accessing the International Monetary Fund.
Rep. Andy BarrAndy BarrThe IMF has lost its way Republicans press Biden administration to maintain sanctions against Taliban World Bank suspends aid to Afghanistan after Taliban takeover MORE (R-Ky.), the ranking member of the House Financial Services subcommittee on national security, authored the bill as an effort to build on early steps that seek to cut off the Taliban from accessing the international financial institution.
World powers have yet to recognize the Taliban’s self-declared state of the Islamic Emirate of Afghanistan, following the insurgent group’s lightning-fast takeover of the country and ousting on Sunday of the Western-backed Afghan government in Kabul.
The Biden administration, which is coming under intense criticism for Afghanistan’s collapse, has sought to manage the fallout of the Taliban’s takeover by working to freeze the country’s assets in the U.S. and abroad.
The International Monetary Fund (IMF) on Wednesday froze $450 million in Special Drawing Rights (SDR) that was scheduled to be dispersed to Afghanistan next week. SDR is a financial asset of the IMF that is lent out to countries so they can access cash based on current market value.
The IMF made the move reportedly under pressure from the Biden administration, which also reportedly acted to freeze Afghan assets in U.S. central banks and the Federal Reserve in an effort to block access by the Taliban.
Barr welcomed this move by the IMF in a statement to The Hill, and added that his legislation is meant to build on such international efforts to financially isolate the Taliban.
“The Administration’s decision to withhold $450 million in [Special Drawing Rights] is a start, but it does not fix the underlying concern that Taliban militants may still gain access to IMF resources,” the GOP lawmaker said.
“My bill would use American muscle to cut off Afghanistan from the IMF, unless there is a national interest to reverse that decision and we can be sure that the government in Afghanistan is protecting women’s rights and not supporting terrorists.”
Barr’s bill, if passed, would direct the U.S. envoy to the International Monetary Fund to advocate against the IMF recognizing any Afghan government that is under the control of the Taliban.
The proposed legislation includes a presidential waiver that can last up to six months but is contingent on the executive branch making specific certifications to Congress.
This includes certifying that the Taliban is upholding the rights of women and girls; that the Taliban is not providing material, financial or technical support to terrorist groups or acts of terrorism; and that such a waiver is in the interest of U.S. national security.
Barr had raised the alarm of the Taliban’s imminent takeover of Kabul and the need to block assets in the U.S. as early as Saturday.
“In light of recent reports of the Taliban’s advances in Afghanistan and the threat they pose to the stability of the Afghan government, I am writing to urge you to take all necessary measures to ensure that any assets of Afghanistan held with the New York Fed are appropriately safeguarded,” Barr wrote in a letter Aug. 14 to the president and CEO of the Federal Reserve Bank of New York, John Williams.
Barr further urged the New York Fed chair to “scrutinize significant transactions involving Afghanistan’s property at your institution, above and beyond automated procedures already in place, to detect, and potentially block, suspicious activity during this time of uncertainty. I also request that you notify Congress of any actions to change authorizations with respect to Afghanistan’s holdings at the Fed.”
The ousted Afghan government is believed to have more than $9 billion in assets in the U.S., according to Ajmal Ahmady, the governor of Afghanistan’s Central Bank who fled the country on Sunday amid the Taliban’s quick advance into Kabul.
Ahmady posted on Twitter that Afghanistan had about $7 billion at the Federal Reserve and $3.1 billion in U.S. bills and bonds.