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UN Chief Warns Absence of Liquidity in Afghan Economy Can Have “Devastated Consequences”

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KABUL: The UN Secretary General Antonio Guterres warned that the absence of liquidity in the Afghan economy could have “devastating consequences” for the people of Afghanistan. The UN chief made the remarks at a press conference with Russian Foreign Minister Sergey Lavrov.  

“In the absence of cash, in the absence of liquidity in the economy of Afghanistan, the collapse of the economy can have devastating consequences for the people of Afghanistan.

So, we have been claiming that the international community needs to create the conditions for cash to be injected in the Afghan economy,” he said.  

Guterres said that the UN is working with the US Department of Treasury to pave the way for the release of Afghan assets.  

Meanwhile, the Central Bank warned that the freezing of Afghan assets will have a severe impact on the value of Afghan currency against foreign currencies.   

“At least 25 packages of cash aid assistance have arrived in Afghanistan as of now, which is over $729 million.

This aid has a vital role in preserving the value of Afghan currency,” said Mohammad Sabir Momand, a spokesman for the Central Bank.

“The removal of restrictions on frozen assets is in the benefit of the people of Afghanistan.” Guterres also told the conference that the UN has brought $500 million to Afghanistan.

Economists believe that the aid is not sufficient to address the Afghan crisis.  “This crisis has widespread aspects and cannot be tackled only through injecting liquidity.

The UN is seeking this aid for its own sake because there is no recognized government in Afghanistan, thus they (UN) spend the money and it goes to its own agencies,” said Azeraksh Hafizi, an economist. 

Earlier, a UN report warned that more than 90 percent of the Afghan population will be living under the poverty line by the end of 2022 if the Afghan economic crisis is not tackled.  

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