Taliban condemn US move to form Swiss-based trust for Afghan central bank funds

The Taliban's foreign affairs ministry says that they will ban or fine individuals and companies who will be the beneficiaries of the fund without their approval

A person holds a bundle of Afghan afghani banknotes at a money exchange market, following banks and markets reopening after the Taliban took over in Kabul, Afghanistan, Sept 4, 2021. REUTERS

The Taliban's foreign affairs ministry on Thursday condemned the United States' decision to transfer Afghan central bank reserves into a Swiss-based trust, saying it was against international norms.

On Wednesday, Washington announced it would transfer $3.5 billion in previously frozen Afghan central bank assets into a new trust fund that it said would be shielded from the Taliban and used to help stabilise Afghanistan's collapsed economy.

The foreign affairs ministry deemed the US decision "to transfer a part of the reserves of the Central Bank of Afghanistan to Switzerland and use it for targeted disbursement without any input by Afghanistan as unacceptable and a violation of international norms," spokesperson Abdul Qahar Balkhi said in a statement.

"If the reserves are disbursed without taking into consideration legitimate demands of the Afghans, the Islamic Emirate will be forced to impose fines against, and ban activities of, all individuals, institutions and companies that facilitate this illegal venture and seek to misuse central bank reserves for humanitarian and other purposes," he said.

The U.S. has said the Afghan fund, managed by a board of trustees, could pay for critical imports like electricity, cover debt payments to international financial institutions, protecting Afghanistan's eligibility for development aid, and fund the printing of new currency.

Though U.S. officials have had talks for months with Taliban and Afghan central bank officials, Washing has said no money would go to the bank until it is "free of political interference" - diplomatic parlance for replacing the bank's top Taliban officials, two of whom are under US and UN sanctions - and anti-money laundering safeguards are instituted.

Balkhi said that in talks with US officials the Taliban had made clear its willingness to open the central bank to third party monitoring of anti-money laundering and counter-terrorism financing programs and that it had proven the central bank was independent.