The Biden government has blocked access to Afghan central bank assets in the US to ensure that they are not available for the Taliban, said an administrative official on Tuesday.
The action, taken by the Ministry of Finance, to cut the outline of the Afghan economic finance will provide economic pressure on the Taliban when they try to maintain public service operations.
Most of the Afghan central bank assets, which include $ 9.4 billion in gross international reserves, are currently not held in Afghanistan.
The decision was reported previously by Politico.
When the Afghan government collapsed on weekends, parliamentarians in the US encouraged to ensure that the financial relationship between countries was cut off.
The level of Afghan ownership in the institution is unclear, although it is common for foreign governments to organize accounts at the Fed New York, both for security reasons and to allow subtle cross-border payments and dollar-based transactions.
Fed New York is not, as a matter of policy, acknowledging or discussing individual account holders, a Fed official said.
It is unlikely that the Taliban will be able to take Afghan assets stored with the Fed.
When the current event affects the status of the account, the New York Fed and the Department of Foreign Affairs determine who can have access based on the manual of the central bank branch compliance revealed a few years ago.
Likewise, under the Federal Reserve law, the State Secretary must recognize representatives of individual foreign accounts.
Separately on Tuesday, a group of parliamentarians sent a letter to the Finance Secretary Janet Yellen, urged him to intervene in the release scheduled for $ 650 billion in an emergency reserve of the International Monetary Fund this month.
Allocation, from what is called a special drawing right, has the potential to provide Afghanistan and Taliban access to $ 450 million.
It is not clear what Yellen can do at this time to intervene, and it’s up to the IMF to determine how a country is recognized.
Afghan central bank acting governor, Ajmal Ahmady, said on Monday that he had received a call on Friday said it would not get further delivery from the US dollar.
The central bank supplies less currency to the market on Saturday, the “increasing panic” step, he said.
The Ministry of Finance refused to comment on the letter to Yellen and delivery were canceled.