U.S. must urge wary banks to help save Afghan lives: aid group

Billions of dollars in Afghan central bank reserves and international development aid were frozen to prevent it from falling into Taliban hands. The United Nations and aid groups are struggling to get enough money into Afghanistan to fund operations in a country where millions are suffering extreme hunger and the economy, education and social services are on the brink of collapse.

The United States needs to give written encouragement to banks to transfer money to Afghanistan for the United Nations and aid groups as they race to save millions of lives, the head of a top international aid group told Reuters on Thursday.

Norwegian Refugee Council Secretary General Jan Egeland, who was U.N. aid chief from 2003-06, was blunt in his assessment: "It is now, paradoxically, the Western sanctions that is our main problem in saving lives in Afghanistan." The Taliban, which has long been blacklisted by the United States as a terrorist group, seized power from Afghanistan's internationally-backed government in August. Billions of dollars in Afghan central bank reserves and international development aid were frozen to prevent it from falling into Taliban hands.

The United Nations and aid groups are struggling to get enough money into Afghanistan to fund operations in a country where millions are suffering extreme hunger and the economy, education and social services are on the brink of collapse. In a briefing https://www.reuters.com/world/asia-pacific/un-chief-tells-security-council-afghanistan-hanging-by-thread-2022-01-26 to the U.N. Security Council on Wednesday, Secretary-General Antonio Guterres said Afghanistan was "hanging by a thread" and that a lack of liquidity in the country was limiting capacity to reach people in need.

Washington issued https://www.reuters.com/world/asia-pacific/us-authorizes-certain-transactions-with-taliban-ease-flow-aid-afghanistan-2021-12-22 sanctions exemptions - known as general licenses - last month related to humanitarian work. But Egeland said that was not enough to convince international banks they could avoid the "wrath" of Washington if they transferred funds to Afghanistan for aid groups, and he urged the Treasury to issue something specific in writing. "The U.S. Treasury needs to be proactive here," said Egeland, who was part of a meeting of aid groups with U.S. Deputy Secretary of the Treasury Wally Adeyemo last week.

Egeland urged the Treasury to give banks "a comfort letter saying that you are hereby encouraged... to help save lives in Afghanistan by providing whatever services are needed for the aid organizations." 'LOSING RACE AGAINST DEATH'

Guterres on Wednesday also called for "general licenses covering transactions necessary to all humanitarian activities." The U.S. Treasury said in a statement after last week's meeting with aid groups that Adeyemo acknowledged the wariness of the banks and said the Treasury would "continue to provide clarity on the scope of U.S. sanctions" to banks and financial institutions.

He also "offered to increase communication with financial institutions engaging in or interested in doing business in Afghanistan to help get resources into the country as quickly as possible," it said. Egeland also appealed for billions of dollars to be released to help Afghan civilians.

Since August, some $9.5 billion in Afghan central bank reserves has been frozen abroad and $1.2 billion in development aid - administered by the World Bank - put on hold as donors seek to use it as leverage over the Taliban on issues including human rights. "Grown men need to speak to each other because, really, I'm frustrated," Egeland said. "The World Bank refers to the (World Bank) board and the donors - like the U.S. - and the donors - like the U.S. - refer to the World Bank. Can they please proactively fix it?"

"We're losing in the race against death, and winter, and starvation," he said. Some former U.S. officials and experts have suggested the administration of President Joe Biden could face backlash in Congress if it allows large amounts of money to be transferred to Afghanistan, amid fears it could fall into the hands of the Taliban.

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