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US sets up fund that could transfer frozen assets to Afghanistan

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(Last Updated On: September 14, 2022)

Washington is to set up a new fund that could eventually serve as a mechanism to free up Afghanistan’s frozen assets in order to promote economic stability in the country, senior US officials told CNN.

According to the officials, the Biden administration has worked with Switzerland and Afghan economists to set up this fund.

The US is moving $3.5 billion to the new “Afghan Fund,” but officials said they won’t release the money imminently because there is no trusted institution in Afghanistan to guarantee the funds will benefit the Afghan people, CNN reported.

Afghanistan’s central bank, Da Afghanistan Bank, issued a statement on Wednesday stating that it “deems any decision on allocation, using and transferring of the assets for irrelevant purposes unacceptable and wants it to be reconsidered.”

The statement notes that the assets are for the stability of currency, strengthening of the financial system and facilitating trade.

According to Turkey’s TRT news outlets, the funds will be transferred to the Bank of International Settlements in Basel, Switzerland, and the U.S. will set up a trusteeship to oversee the disbursement of the money for the purposes of both monetary policy and humanitarian aid.

“The [Da Afghanistan Bank] funds belong to DAB and should be returned to Afghanistan,” said Suhail Shaheen, a spokesperson for the IEA who serves as head of the political office.

“In this critical time when 99% of Afghans are living under the poverty line, it is direly needed that the reserve[s] return to the country.”

However, a US official told CNN that transferring these funds to the Afghan central bank will depend on two key factors: responsible management of the bank and assurances that the funds will not be diverted to terrorists or criminals.

“We do not have that confidence today,” said a senior US official. At minimum the Afghan central bank will need to “demonstrate its independence from political influence and interference.”

The officials also said DAB will also need to demonstrate it has “instituted adequate anti-money laundering and countering the financing of terrorism controls” and “complete a third party needs assessment and onboard a reputable third party monitoring,” the official explained.

CNN reported that it reviewed a letter sent to DAB this week from the US deputy secretary of the Treasury, which mapped out steps DAB needed to take. The letter cites the need for DAB to demonstrate independence from IEA influence and interference, among other expectations, CNN reported.

Earlier this year President Joe Biden signed an executive order allowing for the $7 billion in frozen assets from Afghanistan’s central bank to eventually be distributed inside the country and to potentially fund litigation brought by families of victims of the September 11, 2001, terror attacks.

Business

Flour mill opens in Herat province

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(Last Updated On: February 5, 2023)

The Ministry of Industry and Commerce says that a new flour mill has opened and is now operational in Herat province.

Afghan Industry and Commerce Minister Nooruddin Azizi, inaugurated the flour mill, which is privately owned, on Saturday in the presence of an accompanying delegation.

According to the ministry, Azizi thanked the business owner for investing in the mill, which was built in Phase 1 of Herat Industrial Park at a cost of $1.2 million.

The flour mill will be able to produce 180 tons of flour per day, and has provided employment for more than 700 people.

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Afghanistan, Pakistan sign draft convention to avoid double taxation

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(Last Updated On: February 4, 2023)

Afghanistan and Pakistan have signed a draft convention to avoid double taxation between the two countries.

The convention was signed after three-day talks concluded in Islamabad on Friday, Pakistan’s Federal Board of Revenue said in an announcement.

The Afghan delegation was headed by Revenue Legal Services Director Nida Muhammad Seddiqi while FBR’s International Tax Operations DG Sajidullah Siddiqui headed the Pakistani delegation.

The sides thoroughly deliberated over all the outstanding issues identified during the second round of negotiations held in Islamabad from 27th-30th December, 2021.

FBR Chairman Asim Ahmad thanked the Afghan delegation for visiting Pakistan and expressed optimism that the convention will further strengthen economic relations between the two countries.

Pakistan’s special envoy for Afghanistan welcomed the move as “another important step forward.”

“It took us some 12 years to cross this milestone. Investors, contractors and businesses on both sides will benefit significantly,” Mohammad Sadiq said on Twitter.

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Afghanistan accuses Uzbekistan of violating Hairatan port deal

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(Last Updated On: February 3, 2023)

Officials of the Afghanistan Railway Authority (ARA) accuse Uzbekistan Railways of violating the new agreement regarding the technical affairs of the rail link between Hairatan and Mazar-e-Sharif.

ARA’s head Bakht-ur-Rahman Sharaft, in an interview with Ariana News, said that Uzbekistan Railways had agreed that 16 Uzbeks be employed for the management of the rail link, but now it is insisting on employing 65 people.

He said that based on the agreement, Uzbekistan should have handed over the technical affairs to a Kazakh company on February 1, however,, Uzbekistan Railways suspended international freight shipment via Hairatan port.

“The only problem is that we had agreed on 16 technical employees, but they have sent a one-sided contract that mentions 65 employees instead of 16 employees, and the salary of each one is 6,000 dollars. This is a huge amount of money and we cannot afford it,” Sharafat said.

The official emphasized that efforts are underway to solve the problem, and a delegation from Afghanistan is ready to travel to Uzbekistan for this purpose.

He also said that efforts are ongoing for the implementation of trans-Afghan railwy project. Although the implementation of this project by foreign engineers is estimated at around 4.8 billion dollars, but the head of the railway administration emphasizes that the project can be implemented at a cost of 2.8 billion dollars.

“We can do anything,” he said. “There is will, there is transparency, there is commitment of leadership.”

Recently, the Afghanistan Railway Administration signed a two-year contract with Kazakhstan on the Haritaan port, according to which Kazakh employees will carry out technical work in this port.

The Hiraitan Railway stretches 75 km from Hiraitan Port to the city of Mazar-e-Sharif, through which commercial goods from China, Kyrgyzstan, Uzbekistan and Kazakhstan are transported to Afghanistan.

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