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Western Union, MoneyGram resume services to Afghanistan

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(Last Updated On: September 3, 2021)

Western Union Co and MoneyGram International Inc resumed money-transfer services to Afghanistan on Thursday, moves in line with a U.S. push to allow humanitarian activity to continue after the Taliban’s takeover, Reuters reported.

According to the report pair suspended services in Afghanistan more than two weeks ago after the Islamist militia captured Kabul at lightning speed.

But an easing of security concerns following the completion of the Taliban’s conquest of the country opened the way for the reopening this week of banks, which the money-transfer firms rely on to dispense and collect funds.

Jean Claude Farah, Western Union’s president in Asia, Europe, the Middle East and Africa, told Reuters the reopening of banks, plus a push by the United States to facilitate humanitarian assistance to the Afghan people, had given the American company confidence to resume services on Thursday.

“Much of our business involving Afghanistan is low-value family and support remittances that support basic needs of the people there, so that’s the grounding that we have and why we want to reopen our business,” Farah said.

“We’ve engaged with the U.S. government, which has conveyed that allowing humanitarian activities, including remittances, to continue are consistent with U.S. policy.”

The flow of funds from migrant workers overseas is a key lifeline for many Afghans and has helped the economy of one of the world’s poorest nations weather years of violence and instability. The United Nations says about half of the population requires aid amid the second drought in four years, Reuters reported.

In a statement, MoneyGram said following guidance from the U.S. government, it was resuming its services in coordination with its partners in the country and the Afghanistan Banks Association.

“We recognize that remittances play a pivotal role in the livelihood and daily needs of the Afghan people,” MoneyGram said.

According to Reuters yet U.S. President Joe Biden’s administration has said it is committed to allowing humanitarian work to continue in Afghanistan.

“We are continuing to engage with the U.S. government and others to understand their policies and what type of longer term regulatory framework will be put in place as it relates to the Taliban,” Western Union’s Farah said.

Remittances to Afghanistan reached $789 million in 2020, around 4% of the country’s gross domestic product (GDP), the World Bank estimated, down from $829 million in 2019.

Such flows have historically played an important role in supporting financial stability. Along with international grants and resilient exports, remittances helped Afghanistan’s current account surplus reach 14.2% of GDP in 2020, the International Monetary Fund said in June.

In recent days, Afghanistan’s central bank has provided funds of hundreds of thousands of dollars to each bank that requested liquidity, a senior banker told Reuters. But the financial system and economy could be in peril unless the Taliban can access the central bank’s roughly $10 billion in assets, which are mostly outside of the country.

Farah said Western Union had been assured by the banks it partners with in Afghanistan that they had sufficient cash to pay receivers of remittances.

“Some of them have indicated at some locations that they have good liquidity in afghani and at least some liquidity in U.S. dollars as well, we allow payouts in both, to resume remittances,” he added.

Before it shut down services on Aug. 16, around 45% of each transaction sent via Western Union to Afghanistan was $200 or less, he said.

Western Union said on Thursday that payouts of any funds sent to Afghanistan were available in select locations. Outbound services, money sent from there to other countries, remained suspended, it added.

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Private sector calls for implementation of economic projects

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(Last Updated On: September 17, 2021)

Afghanistan’s private sector on Thursday called on the new government to implement large, regional projects saying this will create job opportunities, which will in turn reduce poverty and increase government revenue.

“There are many opportunities in the country. TAPI, CASA-1000, Railways, Belt and Road, [these] projects should be implemented; it is very important for the country. It is beneficial for Afghanistan. Taliban (Islamic Emirate) should take it seriously,” said Khan Jan Alokozay, a member of the Afghanistan Chamber of Commerce and Investment.

Some members of the country’s craftsmen association said the Islamic Emirate should start with projects that connect Central Asia to South Asia, in order to push Afghanistan’s economy.

“Our country has the capacity to implement large projects between Central Asia and South Asia. We call on Taliban (Islamic Emirate) to address the projects, said Abdul Jabar Safi, head of the association.

The Islamic Emirate meanwhile has stated that they are focusing on projects and that work on these will start soon.

Economic analysts, on the other hand, have stated that work on such projects should be accelerated.

“Attention should be paid to these projects, in order to move to a stable economy. Afghanistan needs such projects now,” said Abdul Wasi, an economic analyst.

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Central bank seizes over $12 million from former govt officials

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(Last Updated On: September 16, 2021)

Afghanistan’s central bank said it had seized nearly $12.4 million in cash and gold from former high-ranking government officials, including former vice president Amrullah Saleh.

In a statement, the central bank said the money and gold had been kept in the houses of officials, although it did not yet know for what purpose.

Saleh’s whereabouts meanwhile are unknown.

In a separate statement, the bank urged Afghans to use the country’s local Afghani currency.

This comes amid growing concerns that the country’s banks and firms are running short of money, especially dollars, which are widely used.

In a sign that the Islamic Emirate are looking to recoup assets belonging to former government officials, the central bank issued a circular to local banks last week asking them to freeze the accounts of politically exposed individuals linked to the previous government.

But on Wednesday, reports emerged that Afghanistan’s banks are running out of dollars, and may have to close their doors to customers unless the government releases funds soon.

Three people with direct knowledge of the matter told Reuters that the cash squeeze threatens to upend the country’s already battered economy, largely dependent on hundreds of millions of dollars shipped by the United States to the central bank in Kabul that make their way to Afghans through banks.

Although the cash crunch has lasted weeks, the country’s banks have in recent days repeatedly underlined their concerns to the new government and central bank, two of the people said.

Banks have already pared back services and imposed weekly $200 payout limits, with long queues outside branches as people try to get hold of dollars.

But in a statement on its website on Wednesday, the central bank’s acting governor said banks were stable.

“The banks are completely secure,” he said, adding that commercial banks usually kept 10% of their capital as cash and that those in Afghanistan, on average, held 50% as cash.

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Efforts underway to reopen Torkham and Spin Boldak border crossings

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(Last Updated On: September 15, 2021)

The Islamic Emirate of Afghanistan’s Acting Foreign Minister Mawlavi Amir Khan Mottaqi met with Pakistani Ambassador to Kabul Mansoor Ahmad Khan on Tuesday to discuss challenges at the country’s border crossings.

Suhail Shaheen, the spokesman for the Islamic Emirate’s political office in Doha, said the meeting focused on the people’s challenges at the Torkham and Spin Boldak crossings.

According to Shaheen, Pakistan’s ambassador to Afghanistan has assured the Islamic Emirate that the crossings will soon be reopened to Afghans and all challenges will be resolved.

Pakistan closed the Torkham crossing to Afghan travelers, and traffic continued intermittently through Spin Boldak after the Islamic Emirate’s takeover of Afghanistan last month.

Thousands of Afghans are however currently waiting to cross into Pakistan at these crossings.

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