Afghanistan

The World Bank said on Tuesday that it had halted disbursements of aid money to Afghanistan as it assesses how the Taliban plan to rule the country, the New York Times reported. A World Bank spokesperson said that the international development organization is “deeply concerned” about the situation in Afghanistan, particularly the impact that the new leadership will have on women in the country. The bank plans to monitor how the leadership transition proceeds and consult with the international community.

Afghanistan’s new Taliban-led government faces a series of shocks that probably will lead to a weaker currency, faster inflation and capital controls, according to the nation’s exiled central bank chief, Bloomberg News reported. The Afghani, as the tender is known, likely will see renewed weakness after it reached a record low last week, Ajmal Ahmady, governor of Da Afghanistan Bank, known as DAB, said in an interview for Bloomberg’s Odd Lots podcast. That could spur a pickup in consumer-price increases by making imports more expensive, he said.

The International Monetary Fund said it will prevent Afghanistan from gaining access to some $450 million in aid in the wake of the Taliban's takeover the country, after the U.S. Treasury Department moved to block the funds, Politico reported. The IMF, with U.S. backing, is issuing billions of dollars worth of new “special drawing rights,” a reserve asset that can be converted to government-backed money, to aid poorer countries. A portion of those assets was scheduled to be allocated to Afghanistan next week, an event that generated urgent pushback from Republican lawmakers.

U.S. Treasury Secretary Janet Yellen should intervene at the International Monetary Fund to prevent Taliban-led Afghanistan from being able to use almost $500 million in reserves, Republican House members said, Bloomberg News reported. The group of 18 lawmakers, including Arkansas’s French Hill, wrote to Yellen on Tuesday in a letter obtained by Bloomberg News, asking Yellen to take action at the fund and respond to their request by Thursday afternoon.

The Taliban strengthened control of the Afghan capital Tuesday as many stores reopened, traffic police returned to their posts and a senior official from the Islamist movement arrived for contacts with political leaders affiliated with the fallen Afghan republic, the Wall Street Journal reported. Thousands of Afghans employed by Western embassies in Kabul remained stranded in the city, unable to enter the airport for evacuation flights. Military flights resumed as the U.S.

Afghanistan is cracking down on tax evasion to repair its finances as the country’s economy struggles with renewed violence and the withdrawal of the huge coalition presence that fed business for years, The Wall Street Journal reported. The departure of most foreign troops two years ago allowed the Taliban to take advantage of the security vacuum and escalate attacks on the government, hurting consumer and business confidence. Double-digit economic growth rates collapsed to almost zero a year after the withdrawal.

An Afghan special tribunal convicted and sentenced two former executives and 19 others for roles in the fraud that led to the collapse in 2010 of Afghanistan's largest private bank, but in a surprise decision threw out the most serious charges, The Wall Street Journal reported. Former Kabul Bank Chairman Sherkhan Farnood and former Chief Executive Khalilullah Ferozi were convicted of fraud at the bank and given five-year prison sentences, the court said Tuesday.

Political interference has impeded an investigation into the collapse of Afghanistan's largest private lender, with some investors, including President Hamid Karzai's brother Mahmood, escaping scrutiny, a joint Afghan-international watchdog said in a report released Wednesday, The Wall Street Journal reported. The Afghan Attorney General's investigation into Kabul Bank's 2010 collapse has led to the prosecution of several bank executives, who have been on trial in the Afghan capital for about a month.

The Afghan government will struggle to pay its bills "within a month" after the International Monetary Fund rejected proposals for resolving the Kabul Bank scandal, western officials have warned, The Guardian reported. Although the war-torn country's biggest bank nearly collapsed last September, the government of Hamid Karzai and the international community are still at loggerheads over plans to fund an $820m (£507m) bailout as well as how the disgraced former managers and shareholders who helped themselves to hundreds of millions of dollars should be prosecuted.

Afghan officials plan to sell part of troubled Kabul Bank, the country's biggest financial institution, in hope of clearing the way to resume international aid temporarily suspended last year after the bank's loan scandal, The Los Angeles Times reported. The head of the country's central bank announced Wednesday that his institution had placed Kabul Bank in receivership and plans to have a government commission collect on its problem loans, then privatize what's left of the bank within three months.