The Biden administration argues it has financial “leverage” over the Taliban to shape its behavior in the form of billions of dollars in Afghan national bank reserves frozen in the United States and hundreds of millions in paused international aid.
National security adviser Jake Sullivan said Tuesday that the mission of the U.S. to get the remaining Americans out of Afghanistan had “shifted from a military mission to a diplomatic mission,” adding, “We have considerable leverage over the Taliban to ensure that any remaining American citizen will be able to get out. … We will work through every available diplomatic means with the enormous leverage that we have and that the international community has to make that happen.”
When asked about the prospect of giving aid to the Taliban, Sullivan said that “humanitarian assistance” such as health and food aid “should go directly to the people of Afghanistan” through international and nongovernmental organizations, insisting “it’s not gonna flow through the Taliban” and that “it will not flow through the government.”
But Sullivan also said: “When it comes to our economic and development assistance relationship with the Taliban, that will be about the Taliban’s actions. It will be about whether they follow through on commitments. … It’s gonna be up to them, and we are gonna wait and see, by their actions, how we end up responding in terms of the economic and development assistance.”
Out of Afghanistan’s estimated $9 billion in bank assets, the U.S. Federal Reserve holds roughly $7 billion of it, including an estimated $3.1 billion in U.S. bills and bonds, $1.2 billion in gold, and $300 million in cash — all of which has been frozen and cannot currently be accessed by the Taliban. An estimated $1.3 billion is located in international accounts and another $700 million in an international financial institution called BIS.
A Biden administration official insisted to the Washington Examiner that “any central bank assets the Afghan government have in the United States will not be made available to the Taliban.”
There are currently a host of sanctions imposed against the Taliban and dozens of Taliban leaders.
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Sullivan told Fox News on Sunday: “We can bring to bear enormous pressure on the Taliban with a swift and forceful response to their blocking any American citizen,” and he argued that “billions of dollars is not soft power — that’s real, cold hard cash that matters.”
Ajmal Ahmady, the former governor of the Afghan central bank, tweeted earlier this month about the Afghan asset breakdown, revealing that U.S. cash shipments to Afghanistan were paused just before Kabul fell, insisting that “in no way were Afghanistan’s international reserves ever compromised” and that “no money was stolen from any reserve account.”
President Joe Biden himself said Tuesday, “The Taliban has made public commitments, broadcast on television and radio across Afghanistan, on safe passage for anyone wanting to leave, including those who worked alongside Americans. We don’t take them by their word alone but by their actions, and we have leverage to make sure those commitments are met.”
Other top Biden officials have pushed the Taliban “leverage” mantra too.
Secretary of State Antony Blinken said Monday humanitarian assistance would continue to be provided to the people of Afghanistan, and “consistent with our sanctions on the Taliban, the aid will not flow through the government, but rather through independent organizations, such as U.N. agencies and NGOs.”
White House press secretary Jen Psaki also said Tuesday: “We have enormous leverage over the Taliban, including access to the global marketplace — that’s not a small piece of leverage — and in order to gain access to the global marketplace, we’re going to be watching closely, as will the global community.”
Rep. Mike Waltz, a Florida Republican and Army veteran who deployed in Afghanistan, had thoughts on the issue of “leverage” too, telling the Washington Examiner, “Stop calling them American citizens ‘stuck’ or ‘stranded’ in Afghanistan, and call them what they are, which is Taliban hostages. We’ve just handed the Taliban a mountain of leverage on a silver platter.”
Waltz added: “Where the administration’s approach is so flawed is, they believe they have leverage over the Taliban to continue to allow safe passage — it’s the other way around. Every time they want access to currency reserves, foreign assistance, economic assistance, international legitimacy, they have that leverage. They have that dial to dial up or dial back.”
The International Monetary Fund had been slated to provide a $340 million award to Afghanistan in late August, but that cannot be turned into hard cash without the Taliban being given access to it.
The World Bank, which has provided more than $5.3 billion to Afghanistan for reconstruction and development over the past two decades, said earlier this month they had “paused disbursements” in Afghanistan.
A spokesperson with the Treasury Department emphasized to the Washington Examiner that “the Taliban is designated as a Specially Designated Global Terrorist.” Presidential executive orders and amendments have dubbed the Taliban a specially designated global terrorist group, but the Afghan Taliban are notably not designated as a foreign terrorist group, even though its Haqqani network and al Qaeda allies are, as well as its Pakistani counterpart, Tehrik-e-Taliban Pakistan.
Republican Sens. Marco Rubio and Rob Portman sent Treasury Secretary Janet Yellen a letter Sunday “to urge you to use all means necessary to keep all internationally-held reserve assets of the Islamic Republic of Afghanistan out of the hands of the Taliban’s illegitimate Islamic Emirate of Afghanistan, and to firmly resist any efforts to release these funds.”
House Republicans sent Yellen a letter a few days after the fall of Kabul, arguing that the Taliban takeover “calls for the United States to cut off hard currency to the Taliban.”
Congressional appropriations legislation earlier this year provided “$3.05 billion for the Afghanistan Security Forces Fund,” but they said the funds “may only be obligated if the Secretary of Defense certifies to Congress that the Afghan forces are controlled by a civilian, representative government that is committed to protecting human rights and women’s rights and preventing terrorists from using the territory of Afghanistan to threaten the United States and our allies” and allowed “no funds for the Taliban except support for reconciliation activities that also include the Afghan government, do not restrict the participation of women, and are authorized by law.”
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A United Nations report from June detailed the Taliban’s finances pre-takeover, estimating that the “annual income generated by the Taliban range from $300 million to $1.6 billion.” The report assessed that “the primary sources of Taliban financing remain criminal activities, including drug trafficking and opium poppy production, extortion, kidnapping for ransom, mineral exploitation, and revenues from tax collection” in areas under Taliban control or influence.
“But when we’re talking about Afghan reserves, Afghan access to the banking system, Afghan access to any kind of fundamental operation of the economy, think about the fact that the United States has basically been the steward of this for the last 20 years — that doesn’t change overnight, and the Taliban well understand it,” Sullivan insisted on CNN on Tuesday night. “So they understand the extent to which their ability to deliver anything for their citizens in the way of a functioning economy rests on the international community — it rests on the United States.”
Sullivan added: “Now, I’m not gonna stand up here and make specific threats — I would rather deal with the Taliban in a direct and decisive way privately. And we believe they fully understand the extent to which, should they choose to go back on their commitments with respect to safe passage or their counterterrorism commitments or others there will be a significant price to pay, and it is not in their self-interest to do that.”
