Business
Central bank governor says international reserves have not been compromised
Ajmal Ahmady, Afghanistan’s central bank governor and former minister of industry and commerce, posted a series of tweets on Wednesday stating he wanted to “clarify the location of DAB (Central Bank of Afghanistan) international reserves.”
He said that DAB reserves were approximately $9.0 billion as of last week but that “this does not mean that DAB held $9.0 billion physically in our vault.”
He said as per international standards, most assets are held in safe, liquid assets such as Treasuries and gold.
He said that DAB was set to receive approximately $340 million on August 23rd from the International Monetary Fund.
“Not sure if that allocation will now proceed with respect to Afghanistan,” he said.
Given Afghanistan’s large current account deficit, DAB was reliant on obtaining physical shipments of cash every few weeks, he said.
“The amount of such cash remaining is close to zero due to a stoppage of shipments as the security situation deteriorated, especially during the last few days,” he said.
“On Friday morning, I received a call notifying me that there would be no further USD (US Dollar) shipments,” Ahmady said, adding they were expecting one on Sunday, the day the Taliban took control of Kabul, but that this shipment did not arrive.
Ahmady said that on Saturday, banks placed very large USD bids as customer withdrawals accelerated.
“For the first time, I therefore had to limit USD access to both banks and dollar auctions to conserve remaining DAB dollars.
“We also put out a circular placing maximum withdrawal limits per customer,” he said.
He assured Afghans that in no way were Afghanistan’s international reserves ever compromised.
“We had a program with both the IMF and Treasury that monitored assets. No money was stolen from any reserve account,” he said.
However, he stated that given that the Taliban are still on international sanction lists, it is expected that such assets will be frozen and not accessible to Taliban.
“I believe local banks have told customers that they cannot return their dollars – because DAB has not supplied banks with dollars.
“This is true. Not because funds have been stolen or being held in a vault, but because all dollars are in international accounts that have been frozen,” he said.
“Taliban should note this was in no way the decision of DAB or its professional staff. It is a direct result of the US sanctions policy implemented by OFAC (the American Office of Foreign Assets Control),” he said.
In conclusion, Ahmady suggested the Taliban implement capital controls and limit dollar access.
Afghanistan and Pakistan have agreed on the issuance of a temporary admission document for transporters of commercial goods, Afghanistan’s Ministry of Transport and Aviation announced on Sunday.
The ministry said in an announcement that truck drivers and their assistants carrying commercial goods from Afghanistan and Pakistan must have this document with them at the crossings.
Based on the announcement, the document will be issued to Afghans at the Pakistani embassy in Kabul and its consulate in Kandahar.
For Pakistanis, the document is distributed at the office of the Afghanistan transport attaché in Peshawar and Quetta.
The Ministry of Transportation and Aviation asked owners and drivers of trucks to submit the required documents to their respective transportation companies by June 1.
The ministry warned that after June 1, trucks cannot travel between the two countries without having the temporary admission document.
Pakistani officials have announced that consultations are underway with stakeholders on preferential trade agreements with Afghanistan and Azerbaijan.
According to Dawn newspaper, the issue was announced on Friday in a meeting on trade chaired by Pakistan’s Prime Minister Shahbaz Sharif.
In the meeting, the strict monitoring of Afghan Transit Trade was also emphasized.
Pakistani officials have not provided further details on preferential trade with Afghanistan and Azerbaijan.
Acting Minister of Industry and Commerce Nooruddin Azizi has said that talks with neighboring countries have started for the export of fresh fruit this year.
Azizi added that the Ministry of Industry and Commerce wants the country’s fresh fruit to be exported to Uzbekistan, Kazakhstan and Iran in addition to Pakistan.
Members of the private sector call on the Ministry of Industry and Commerce to step up efforts to find new markets for Afghan exporters.
“We ask the authorities to determine the export routes before the harvesting season. We should find new markets instead of Pakistan. There is capacity for Afghanistan’s exports in the region, and action should be taken in this regard,” said Mirwais Hajizada, the deputy of Chamber of Agriculture and Livestock.
Economic experts say that the Ministry of Industry and Commerce should hold talks with Iran and Uzbekistan in addition to Pakistan for Afghanistan’s exports.
“There are many opportunities to sell our products in markets other than Pakistan. I hope the authorities will think about this. Grounds should be paved to access the markets of South Asia and the Gulf countries through Iran, and the markets of Central Asia through Uzbekistan,” said Mohammad Nabi Afghan, an economic expert.
Members of the private sector say that although Pakistan is the closest and largest market for Afghanistan’s dry and fresh fruits, doing business with it has always been challenging.
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