World Bank exclusively works to redirect frozen funds to Afghanistan solely for humanitarian aid: sources

By Jonathan Landay and Andrea Shalal

WASHINGTON (Reuters) – The World Bank is finalizing a proposal to divert up to $500 million from frozen Afghanistan aid funds to humanitarian agencies, people familiar with the plans told Reuters, but it makes tens of thousands of public sector workers are eliminated and are still complicated by US sanctions.

Council members will meet informally on Tuesday to discuss the proposal, made in recent weeks with US and UN officials, to redirect funding from the Reconstruction Trust Fund Afghanistan (ARTF), has a total of $1.5 billion.

Afghanistan’s 39 million people face a frayed economy, a winter of food shortages and rising poverty three months after the Taliban took power as US troops finally pulled out of 20 years of war.

Afghanistan experts say the aid will help, but major gaps remain, including how to get money into Afghanistan without exposing financial institutions involved in US sanctions, and lack of focus on state workers, sources said.

They said the money would be primarily to address urgent healthcare needs in Afghanistan, where less than 7% of the population has been vaccinated against the coronavirus.

For now, it will not pay teachers and other government employees, a policy that experts say could hasten the collapse of public education, health care and services systems. society of Afghanistan. They warn that hundreds of thousands of workers, who have not been paid for months, could stop showing up for work and join a mass exodus from the country.

The World Bank will not monitor the funds once they are transferred into Afghanistan, one of the sources familiar with the matter said.

“The proposal calls for the World Bank to transfer money to the United Nations and other humanitarian agencies without any oversight or reporting, but it says nothing about the financial sector, or how the money will enter. in the country,” the source said. called the US sanctions a major constraint.


The source added: While the US Treasury Department has provided a “letter of comfort” assuring banks that they can handle the transactions humanely, concerns about sanctions continue to deter them. prevent the passage of basic supplies, including food and medicine.

“It was a scorched earth approach. The source said we are pushing the country into dust. Sanctions that are condescending and disinterested in public sector employees will “create more refugees, more despair and more extremes.”

Any decision to redirect ARTF money requires approval from all donors, of which the United States is the largest country.

A State Department spokesperson confirmed that Washington is working with the World Bank and other donors on how the funds will be used, including the possibility of paying people working in “critical positions.” as healthcare workers and teachers.”

The spokesman said the US government remains committed to meeting the essential needs of the Afghan people, “especially in the areas of health, nutrition, education and food security… but international aid remains not a silver bullet.”


Established in 2002 and administered by the World Bank, the ARTF is the largest source of financing for Afghanistan’s civilian budget, with more than 70% of it being foreign aid.

The World Bank suspended disbursements after the Taliban took over. At the same time, Washington stopped providing US dollars to the country and joined in freezing about $9 billion in assets of the central bank of Afghanistan and stopped providing financial support.

A World Bank spokesperson confirmed that staff and board members were looking into redirecting ARTF funds to UN agencies “to support humanitarian efforts”, but did not allow more details. The United Nations declined to comment.

Initial work has also been done with the possibility of swapping US dollars for Afghans to move money into the country, but those plans are “basically just a couple of PowerPoint slides at this point,” one of sources said. That approach would deposit ARTF funds into international accounts of private Afghan organizations, who would disburse Afghans from their Afghan bank accounts to humanitarian groups in Afghanistan, the two sources said.

This would bypass the Taliban, thereby avoiding entanglement with US and UN sanctions, but the plan is complex and untested, and can take time to implement.

A key problem is the lack of a mechanism to monitor the disbursement of funds in Afghanistan to ensure Taliban leaders and fighters do not have access to them, a third source said.

Two former US officials familiar with internal discussions say that some US officials argue that US and UN sanctions against Taliban leaders prohibit financial aid to anyone affiliated with the government. their government.

(Reporting by Jonathan Landay and Andrea Shalal; Additional reporting by Arshad Mohammed and Michelle Nichols; editing by Grant McCool)

https://whbl.com/2021/11/29/exclusive-world-bank-works-to-redirect-frozen-funds-to-afghanistan-for-humanitarian-aid-only-sources/ World Bank exclusively works to redirect frozen funds to Afghanistan solely for humanitarian aid: sources


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