KABUL: The Taliban have banned the use of all foreign currencies in Afghanistan as a step to try to stabilize a shrinking economy despite the widespread use of the US dollar.
“All Afghans must use Afghani currency in their every trade given the current economic situation and national interests of Afghanistan,” Taliban spokesman Zabihullah Mujahid said in an online statement.
Afghanistan economy was dealt a devastating blow after the withdrawal of international financial support following Taliban takeover.
“The Islamic Emirate instructs all citizens, shopkeepers, traders, businessmen and the general public to henceforth conduct all transactions in Afghanis and strictly refrain from using foreign currency,” said Mujahid.
This is as U.S. Deputy Treasury Secretary Wally Adeyemo told the US Senate Banking Committee last month that they should maintain their sanctions against the Taliban but at the same time find ways for legitimate humanitarian assistance to get to the Afghan people.
The Taliban has called for the release of Afghanistan’s assets that are being held overseas as the nation faces a severe cash crunch.
Afghanistan has also been hit by the exodus of foreign aid. Grants from overseas previously financed three quarters of its public spending.
Earlier this year, the International Monetary Fund (IMF) said Afghanistan will no longer be able to access its resources, while the World Bank also halted funding for projects in the country.
Last month, the IMF warned that the country’s economy could shrink by 30% this year, pushing millions into poverty and causing a humanitarian crisis.
The fund also said that Afghanistan’s economic woes could fuel a refugee crisis impacting neighbouring countries, Turkey and Europe.
The country is also suffering from a severe drought, which has ruined much of its wheat crop and sent prices soaring.