Afghan central bank drained dollar stockpile before Kabul’s fall: report

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FRANKFURT/MUMBAI – The Afghan central bank ran down most of its United States dollar cash reserves in the weeks before the Taliban took control of the country, according to an assessment prepared for Afghanistan’s global donors, exacerbating the current economic crisis.

The confidential two-page brief, written early this month by senior international economic officials for institutions including the World Bank and International Monetary Fund, said the country’s severe cash shortage began before the Taliban took control of Kabul.

It criticised how the bank’s former leadership handled the crisis in the months before the Taliban’s conquest, including decisions to auction unusually large amounts of US dollars and move money from Kabul to provincial branches.

“FX (foreign exchange) reserves in CB’s (central bank’s) vaults in Kabul have depleted, the CB cannot meet... cash requests,” said the report, seen by Reuters.

“The biggest source of the problem is the mismanagement at the central bank prior to the Taliban takeover.”

Shah Mehrabi, chairman of the bank’s audit committee who helped oversee the institution before the Taliban took over, and is still in the post, defended the lender’s actions, saying it is trying to prevent a run on the local Afghani currency.


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