US economic war on Afghanistan amounts to a humanitarian crime | Larry Elliot
The war in Afghanistan did not end when American and British troops left Kabul airport last year; he simply took on a different form, but still deadly.
President Joe Biden’s response to the military humiliation inflicted on America by the Taliban has been a scorched earth policy designed to cause maximum economic damage to what was already one of the world’s poorest countries. .
Pursuing this war by other means involved freezing Afghan state assets held in New York. This meant the threat of sanctions against banks and other foreign companies doing business in Afghanistan. This involved stopping payments from the World Bank’s Afghanistan Reconstruction Trust Fund (ARTF). This meant no Covid-19 emergency financial assistance from the International Monetary Fund.
At the time, it was obvious that this withdrawal of foreign financial aid – which accounted for almost half of Afghanistan’s gross domestic product in 2020 – would have a disastrous impact, and it turned out.
While the illicit opium-based trade is still going strong, the rest of the economy has all but collapsed. On average, companies laid off 60% of their workers. The price of basic foodstuffs has increased by 40%. More than half of the population needs humanitarian aid and the poverty rate is around 90%. By far, these are the highest levels of distress in the world. The United Nations children’s fund, UNICEF, estimates that more than one million Afghan children are at risk of dying from malnutrition or hunger-related diseases.
Statistics do not paint the full picture of people who need food so badly that they sell their young daughters into marriage or have their organs harvested for money. What is clear is that instead of selectively targeting the Taliban, the United States and its European allies are inflicting collective punishment on an entire country, mistakenly believing that this somehow respects Western values. Letting children go hungry does not respect Western values. Closing schools because teachers are not paid does not respect Eastern values. After losing the war, Washington is now losing the peace.
Some humanitarian funding is flowing into Afghanistan through UN agencies and some of the major development charities, but this is only a fraction of the aid that was flowing to keep schools open and pay for salaries of public sector workers before the Taliban takeover. Precise estimates of the scale of the short-term aid provided are difficult because conditions are so chaotic that it is difficult to tell whether the money flown in is actually getting to where it is needed. But it’s probably around 10% of the $8.5bn (£6.2bn) that came in every year before the Taliban took over. As one observer put it, the West’s approach has been to torpedo the economy and then provide a few leaky lifeboats to pick up the survivors.
The new Afghan leaders had no economic plan in August and still do not have one six months later. To some extent they don’t need one, one because they have a ready made alibi: the economy is a mess because the Americans decided to make it so. There is not a shred of evidence that the impoverishment of the Afghan people comes close to regime change. What it does is ensure mass unemployment and widespread poverty: the ideal conditions to breed terrorism and generate an exodus of refugees.
Biden has an obvious problem. It wouldn’t be a great look for the White House to soften after so many American lives were lost in a failed two-decade war. It is hard, however, to escape the conclusion that there would have been a lot more noise if Donald Trump had won the election in 2020 and pursued the same policies.
Admittedly, there has been a slight easing of sanctions to allow banks to conduct business for certain tightly controlled purposes without incurring sanctions. In December, the World Bank, deeply concerned about the deteriorating situation, transferred $280 million from the ARTF to Unicef and the World Food Programme. But there was no real relaxation. The Bank says it is in the hands of its shareholders. The IMF claims to be guided by the international community. In reality, both take orders from the US Treasury and the State Department, and have effectively become instruments of US foreign policy.
That the Taliban hold odious views is undisputed. It would also be naïve to imagine – given the abject confusion – that aid could be restored without much of it being wasted or stolen. The same could be said of many other countries, but only Afghanistan is singled out for this brutal form of revenge.
Eventually the following will happen. Afghanistan’s foreign exchange reserves will be unfrozen by the Americans. A floor will be put under the economy through an easing of sanctions so that non-humanitarian aid can be provided. The central bank will begin to operate. Discussions will be allowed to start with the IMF for a conditional bailout. The World Bank will relaunch its programs in an attempt to prevent the human development gains it has financed over the past two decades from being wasted.
Strong public pressure must be brought to bear on the United States to ensure this happens as soon as possible. China has been rightly condemned for its treatment of Uyghurs in Xinjiang, but there has been no similar mobilization of international opinion against policies that are proving disastrous for millions of innocent and vulnerable Afghans. This must change, because what the United States is doing amounts to a humanitarian crime. And those who know what is happening but remain silent are accomplices to this crime.