World Bank freezes aid to Afghanistan
GS Paper - 2 (International Relations)
The World Bank suspended funding for dozens of projects in Afghanistan, citing questions over the legitimacy of Taliban rule. The Washington-based institution has committed around $5.3 billion for reconstruction and development projects in Afghanistan since 2002 through its International Development Association that helps the world’s poorest countries.
- As of April, the development association had 12 active projects totaling $940 million in commitments, the bank said in its latest update earlier this year.
- Separately, its Afghanistan Reconstruction Trust Fund had 15 projects with $1.2 billion committed, it said in its April update.
- Under its policies, the World Bank said it cannot disburse funds when there is no agreement by its 189 member countries on whether a country has a legitimate government.
- Most of the World Bank’s support in Afghanistan—about $4.8 billion—has come in the form of grants, while $436 million has been in the form of no-interest loans.
- To help rebuild the country, the World Bank also created and administered the Afghanistan Reconstruction Trust Fund, which has been supported by funding from 34 donor countries.
- The money has been allocated to a variety of projects, including improving urban water systems, building vocational schools and responding to the Covid-19 pandemic.
- The International Monetary Fund, which like the World Bank is based in Washington and collectively owned by member governments, said earlier that Afghanistan would be ineligible for IMF loans until a government is recognized.