Kabul’s economy pressures Taliban’s international compass and keeps it under control

Nahla Abdel Moneim

The Taliban faces major problems, most notably Afghanistan’s difficult economic situation, which raises questions about the movement’s ability to deal with financial variables, such as tools likely to be employed to trap them at international tables.

Afghanistan suffers from economic deterioration after years of war that negatively affected the infrastructure, the supply of the banking and monetary sector, including debt problems, and the frozen balances in banks abroad following the movement’s seizure of power.

With many internal files still unresolved in Kabul, will the interim Taliban government face mandatory paths for its international relations?

Taliban and the turbulent economic situation

On September 28, the CEO of the Islamic Bank of Afghanistan, Syed Moosa Kaleem al-Falahi, warned of an imminent collapse of the country’s financial and banking sector against the background of security panic and internal chaos that left major withdrawals amid weak and crumbling deposits.

Falahi told the BBC that only withdrawals are made in the country and that the banks are not working to their full potential, pointing out that this situation is catastrophic for a country that mainly suffers from dependence on foreign aid.

For her part, White House spokeswoman Jen Psaki stressed on September 2 that the sanctions imposed on the Taliban will not be eased, most notably maintaining decisions to freeze assets and funds deposited with major American banks. The International Monetary Fund stated in August that Afghanistan will not be able to benefit from the IMF’s financial services due to the lack of clarity around the international recognition of the Taliban’s authority over the country.

Meanwhile, the international community, especially the United States and Europe, wrapped their threatening tone to the movement with humanitarian promises about grants and aid to the Afghan people.

However, the international division over dealing with the Afghanistan crisis makes the vital sectors more affected, which increases the suffering of the citizens. The suffering of the Afghan people has emerged with the collapse of the health sector in light of the spread of the corona pandemic, along with harsh working conditions due to the disturbances and chaos that contributed to complicating the working conditions in hospitals and health centers.

International division towards Taliban and financial sector variables

There are many files related to the rule of the Taliban in Afghanistan and whether it will obtain imminent international recognition or will be denied, and who the first countries are to accept its rule.

These variables are related to global understandings about what is required of the movement towards important interests in the Asian region and the mechanisms for their implementation.

Although the withdrawal of the United States was planned within a clear strategy to reduce the fighting in foreign outposts in favor of new positions on the map of the conflict formed to confront the Chinese giant and the Russian ambitions for which NATO was established, the Taliban is emerging as a new ruler of a special focus in the global conflict. It did not seize its rule by chance, but rather within official negotiations that were concluded in February 2020 between them and Washington.

Between the understandings of Washington and the Taliban comes a long history of special relations and strategic understandings between the movement and both Russia and China that casts a shadow over the effects of the situation on the country’s financial conditions. For its part, Moscow is demanding the release of Afghanistan’s frozen assets, as Russia’s permanent representative to the United Nations, Vasily Nebenzya, called on September 9 to liberate the Afghan assets.

These visions give an explanation of the international tensions towards the crisis and how the major countries are dealing with the arrival of a militant movement to power, and the economic conditions remain an important indicator of the Taliban’s ability to impose its control over the country and reconcile its interests with foreign countries, meaning that the two variables are more interrelated when discussing economic conditions.