The economic situation remains dire. The Taliban’s seizure of power resulted in an abrupt halt to most donor funds. These disbursements accounted for 45 percent of GDP and financed 75 percent of state expenditures, including public sector salaries.

 Afghanistan’s Central Bank doubled the cap on weekly withdrawals Wednesday, a day after the Taliban government banned all foreign currency transactions, AP reports.

The back-to-back decisions come at a time of a continued deterioration of the Afghan economy. The Taliban portrayed the foreign currency ban as a way of trying to stabilize economy, and warned that violators would be prosecuted.

Others suggested the ban could be counterproductive. Much of Afghanistan’s economy revolves around foreign trade, foreign aid and remittances from abroad. The local currency, the afghani, has depreciated since the Taliban takeover of Afghanistan in August.

After the Taliban takeover, the U.S. froze nearly $9.5 billion in assets belonging to the Central Bank and stopped shipments of cash. It was part of a pressure campaign aimed at getting Afghanistan’s new rulers to respect the rights of women and minorities.

In response, bank withdrawals were capped at the equivalent of $200 a week. Huge crowds formed outside banks every day as Afghans tried to get money for daily needs.

© Copyright LaPresse