FACT SHEET: Executive Order to Preserve Certain Assets of the Central Bank of Afghanistan for the People of Afghanistan

As part of our ongoing work to address the humanitarian and economic crisis in Afghanistan, President Biden signed an Executive Order (EO) to help allow certain U.S.-based assets owned by Afghanistan’s central bank, Da Afghanistan Bank (“ATM”), to be used for the benefit of the Afghan people. The OE will freeze ATM assets held in the United States by U.S. financial institutions and require U.S. financial institutions to transfer those assets to a consolidated account held at the Federal Reserve Bank of New York. The Administration will work to facilitate access to $3.5 billion of these assets for the benefit of the Afghan people and for the future of Afghanistan pending a court ruling.

Many American victims of terrorism, including relatives of victims who died in the September 11, 2001, terrorist attacks, have filed charges against the Taliban and are suing DAB assets in federal court. Since some of these plaintiffs currently have writs of execution against DAB’s assets, the court will have to make a new decision regarding the scope of those writs. Even if the funds are transferred for the benefit of the Afghan people, more than $3.5 billion in ATM assets would remain in the United States and are the subject of ongoing lawsuits by American victims of terrorism. Claimants will have full opportunity to have their claims heard in court.

This is a step forward in U.S. efforts to authorize the transfer of a significant portion of funds intended to meet the needs of the Afghan people. The EO is designed to allow funds to reach the Afghan people, while keeping them out of the hands of the Taliban and malicious actors. The United States has sanctions in place against the Taliban and the Haqqani Network, including for activities that threaten the safety of Americans, such as taking our citizens hostage.

While this EO will help preserve a substantial portion of Afghanistan’s reserves for the benefit of the Afghan people, we understand that there are no easy solutions to Afghanistan’s economic challenges, which have been exacerbated by the of forced control of the country by the Taliban:

  • Even before the events of last August, the Afghan economy was on the brink. Afghanistan faced poverty rates above 50%. Grants from international donors financed about 75% of public expenditure and 50% of the government budget. A two-year drought had reduced many crops to 40% of their usual yields, and Afghanistan had one of the least developed financial systems in the world, with only 10-20% of adults holding bank accounts. Endemic corruption has crippled sectors that should have been profitable.
  • The Taliban’s forced takeover has worsened the already fragile economic situation. The IMF estimates that Afghanistan is facing a 30% economic contraction, and many senior officials and technical experts needed to ensure sound economic management have fled the country as a result of the Taliban’s actions.
  • These issues reflect long-standing structural issues that predated the events of August 2021 and have worsened due to uncertainty and perceived risk surrounding the Taliban’s ability to manage the economy. This includes its ability to implement anti-money laundering measures and counter-terrorist financing measures.

In this difficult environment, the United States will continue to work tirelessly with the international community to ensure that humanitarian assistance and other forms of support reach the Afghan people. Over the past few months, we have taken urgent action to support the Afghan people:

  • The United States remains the largest donor of humanitarian aid to Afghanistan. Last month, the United States announced a new contribution of more than $308 million in humanitarian assistance to the Afghan people and we have provided more than $516 million since mid-August. Humanitarian aid is channeled through independent humanitarian organizations and helps provide vital protection and shelter, essential healthcare, overwintering aid, emergency food aid, water, sanitation and hygiene in response to growing humanitarian needs exacerbated by COVID-19 and healthcare shortages, drought, malnutrition and the winter season.
  • The United States recently provided the Afghan people with an additional million doses of COVID-19 vaccine through COVAX, bringing our total donation to 4.3 million doses.
  • In December 2021, the United Nations Security Council passed a resolution championed by the United States to establish an exception for humanitarian assistance and activities that support basic human needs in the 1988 UN sanctions regime. to ensure that urgently needed aid can reach the Afghan people. The United States is also working closely with the United Nations on mechanisms to ensure that United Nations agencies and NGOs have the cash needed to support essential humanitarian assistance programs.
  • Since September 2021, the Treasury Department has granted broad authorities that facilitate the continued delivery of aid and support to the people of Afghanistan by NGOs, international organizations, and the U.S. government. In December, the World Food Program, with support from USAID, provided food assistance to 8 million people across Afghanistan. This was facilitated by licenses issued by the US Treasury Department.
  • The United States worked closely with the United Nations on the World Bank’s “transfer” of $280 million in funds from the Afghanistan Reconstruction Trust Fund (ARTF) to United Nations organizations. . We are proud to be the largest funder of UN operations in Afghanistan and the largest donor to ARTF.

The United States is committed to supporting the Afghan people, and we continue to explore all options available to us to achieve that goal.

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