Why is the money about to disappear in Afghanistan?
Afghanistan is on the verge of collapse, with crisis, both economic and humanitarian, crippling the citizens of the nation. And it is already a weak economy that has gone from bad to worse with the virtual disappearance of money in Afghanistan.
The reasons for the crisis
It’s supposedly the tight supply of money, coupled with border restrictions and growing international isolation that leaves Afghan workers unpaid, forcing local businesses to shut down and banks to impose limits on withdrawals.
And if this continues, it is a threat for Afghanistan to be cut off from the outside world as wireless carriers struggle to pay providers.
The most worrying scenario is worsening food shortages which have driven up the cost of essentials, paving the way for a wider economic and humanitarian crisis in the country.
As the nation fights for its survival every day, the Taliban previously said customs duty revenue was enough to cover public sector wages. But it is unclear how far funds can be stretched from these sources of income.
Also read: A list of things Afghanistan exported to India
Lack of outside help?
Another problem is that the United States and others have yet to allegedly recognize the Taliban as the legitimate authority in Afghanistan, as concerns over their involvement in terrorism and human rights abuses remain. topical. The Taliban even lost access to more than $ 9 billion in central bank reserves after US President Biden’s administration froze assets held in US banks in mid-August, with other countries following suit. not in Washington. Even funding from the World Bank and the International Monetary Fund is also suspended.
And for what little reserves might remain, the Taliban have resorted to capital controls, including banning Afghans from taking dollars out of the country and limiting bank withdrawals. The liquidity crisis is such that some residents of Kabul are selling furniture and other household items at flea markets to raise funds and make ends meet.