The US State Department has officially announced the establishment of the international financing mechanism which will see $3.5 billion worth of Afghanistan’s frozen assets being used for the benefit of the people.

In a press briefing on Wednesday night, State Department spokesman Ned Price said: “Today, the Department of State and the Department of the Treasury, in coordination with international partners including the Government of Switzerland and Afghan economic experts, announced the establishment of a fund to benefit the people of Afghanistan.”

Price stated the US would like to thank the Swiss Government for its partnership to ensure this effort would be possible.

“This fund will protect and preserve the Afghan central bank reserves, while making targeted disbursements to help stabilize Afghanistan’s economy and, ultimately, support its people and work to alleviate the worst effects of the humanitarian crisis,” he said.

He stated the Islamic Emirate of Afghanistan (IEA) is “not a part of this financing mechanism and resources disbursed will be for the benefit of the Afghan people, with clear safeguards and auditing in place to protect against diversion or misuse.”

“And the US has made clear to the Taliban (IEA) that the onus is on them to make key reforms which we have outlined repeatedly,” he added.

Elaborating on when the funds will be disbursed, he said it “will take a little bit of time. We’re, of course, working as quickly as we can to do that.”

He stated however that the Afghan Fund is “explicitly not intended to make humanitarian disbursements. The Afghan Fund itself is to facilitate macroeconomic stability inside Afghanistan.”

Price said this meant the US will remain the largest humanitarian donor for the Afghan people.

“This is not what that fund is for. This fund is to provide macroeconomic stability in Afghanistan that will enhance the effectiveness of humanitarian assistance from the United States and other donors.”

On the remaining $3.5 billion of Afghanistan’s $7 billion frozen by the US, Price said this money “remains subject to litigation” and did not form part of the new fund.

The new fund does however have a vetted list of sources for disbursement, he said adding that possible scenarios could include using the fund to pay for electricity for example.

Price said “that is something that could – we could envision the fund doing. To pay arrears at international financial institutions, the types of activities that are separate and apart from the day-to-day welfare that our humanitarian assistance and the humanitarian assistance of the international community is designed for.”