Business
World Bank works to redirect frozen funds for humanitarian aid only
The World Bank is finalizing a proposal to deliver up to $500 million from a frozen Afghanistan aid fund to humanitarian agencies, people familiar with the plans told Reuters, but it leaves out tens of thousands of public sector workers and remains complicated by U.S. sanctions.
Board members will meet informally on Tuesday to discuss the proposal, hammered out in recent weeks with U.S. and U.N. officials, to redirect the funds from the Afghanistan Reconstruction Trust Fund (ARTF), which has a total of $1.5 billion, Reuters reported.
Afghanistan’s 39 million people face a collapsing economy, a winter of food shortages and growing poverty three months after the the former government collapsed.
Afghan experts said the aid will help, but big gaps remain, including how to get the funds into Afghanistan without exposing the financial institutions involved to U.S. sanctions, and the lack of focus on state workers, the sources said.
The money will go mainly to addressing urgent health care needs in Afghanistan, where less than 7% of the population has been vaccinated against the coronavirus, they said.
For now, it will not cover salaries for teachers and other government workers, a policy that the experts say could hasten the collapse of Afghanistan’s public education, healthcare and social services systems.
They warn that hundreds of thousands of workers, who have been unpaid for months, could stop showing up for their jobs and join a massive exodus from the country.
The World Bank will have no oversight of the funds once transferred into Afghanistan, said one of the sources familiar with the plans. A U.S. official stressed that UNICEF and other recipient agencies would have “their own controls and policies in place.”
“The proposal calls for the World Bank to transfer the money to the U.N. and other humanitarian agencies, without any oversight or reporting, but it says nothing about the financial sector, or how the money will get into the country,” the source said, calling U.S. sanctions a major constraint.
While the U.S. Treasury has provided “comfort letters” assuring banks that they can process humanitarian transactions, concern about sanctions continues to prevent passage of even basic supplies, including food and medicine, the source added.
“We’re driving the country into the dust,” said the source. Crippling sanctions and failure to take care of public sector workers will “create more refugees, more desperation and more extremism.”
A State Department spokesperson confirmed that Washington is working with the World Bank and other donors on how to use the funds, including potentially paying those who work in “critical positions such as healthcare workers and teachers.”
The spokesperson said the U.S. government remains committed to meeting the critical needs of the Afghan people, “especially across health, nutrition, education, and food security sectors … but international aid is not a silver bullet.”
Established in 2002 and administered by the World Bank, the ARTF was the largest financing source for Afghanistan’s civilian budget, which was more than 70% funded by foreign aid.
The World Bank suspended disbursements after the Islamic Emirate of Afghanistan (IEA) takeover. At the same time, Washington stopped supplying U.S. dollars to the country and joined in freezing some $9 billion in Afghan central bank assets and halting financial assistance.
One major problem is the lack of a mechanism to monitor disbursements of funds in Afghanistan to ensure Taliban leaders and fighters do not access them, a third source said.
Business
Iraqi intelligence report alleges oil smuggling network supplying Afghanistan and Turkey through Iran
The report highlights broader challenges facing regional authorities in combating illicit oil trade and enforcing international sanctions.
An Iraqi intelligence report obtained by Sky News Arabia has revealed alleged large-scale crude oil smuggling operations from northern Iraq into Iran, where the oil is reportedly refined and later sold in regional markets, including Afghanistan and Turkey.
According to the report, shipments of crude oil are transported through land routes and unofficial trade channels into Iranian territory, where they undergo refining and processing before being re-exported to foreign markets.
The intelligence findings suggest that the alleged network is designed to bypass international sanctions and facilitate the movement of petroleum products outside official trade and financial monitoring systems.
The report further indicates that smuggling networks rely on informal transportation routes and cross-border commercial channels to maintain the collection, processing and distribution of oil products while avoiding regulatory oversight.
The revelations have raised concerns over cross-border smuggling, the loss of national resources and the potential impact of illicit oil trade on regional economies.
Security and political observers say the reported activities could put additional pressure on Iraqi authorities to strengthen border controls, monitor oil transportation routes and improve coordination with regional and international partners.
However, the allegations outlined in the intelligence report have not been independently verified, and further details about the networks involved, the quantities of oil transported and the scale of supplies reaching Afghanistan and Turkey remain unclear.
The report highlights broader challenges facing regional authorities in combating illicit oil trade and enforcing international sanctions.
Business
$30 million pharmaceutical investment launched in Herat as new production line opens
Meanwhile, the newly inaugurated serum and injectable production line is capable of producing up to 100,000 packages of serum per day.
The foundation stone has been laid for three new pharmaceutical production blocks at Ovison Pharma in Herat, with an investment of $30 million, while the factory’s new serum and injectable production line has also been inaugurated.
The new production blocks will be constructed on a 3,000-square-metre site, with each facility planned to have five floors. Equipped with advanced machinery and designed to meet international standards, the expansion is expected to significantly increase the factory’s pharmaceutical production capacity.
Meanwhile, the newly inaugurated serum and injectable production line is capable of producing up to 100,000 packages of serum per day.
The expansion marks a significant step toward strengthening Afghanistan’s pharmaceutical industry, increasing domestic production and reducing the country’s reliance on imported medicines.
The investment is also expected to support the development of local manufacturing capacity and improve access to domestically produced pharmaceutical products.
Business
Afghanistan approves new foreign investment policy in bid to attract international investors
The decisions have been forwarded to the office of the Supreme Leader of the Islamic Emirate for final approval.
Afghanistan’s Economic Commission has approved a new foreign investment policy aimed at attracting international investors, improving investment opportunities and supporting the country’s economic growth.
The decision was made during the commission’s regular meeting, chaired by Mullah Abdul Ghani Baradar, Deputy Prime Minister for Economic Affairs, at the Marble Palace on Monday.
According to the Deputy Prime Minister’s Office for Economic Affairs, the proposed policy was presented by a committee established under the leadership of the economic deputy office. Following a comprehensive review and consideration of the commission’s recommendations, the policy was approved.
The policy aims to regulate foreign investment activities, facilitate investment procedures, create a favourable environment for investors, ensure investment security and promote Afghanistan’s economic growth and development.
During the meeting, the commission also approved a proposal concerning the payment of fixed taxes by commercial import companies at the country’s customs offices.
Officials said implementing the proposal would create additional facilities and simplify procedures for importing businesses.
The decisions have been forwarded to the office of the Supreme Leader of the Islamic Emirate for final approval.
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