United Nations sets up trust fund for ‘people’s economy’ in Afghanistan

GENEVA: The UN has set up a special trust fund to provide urgently-needed cash directly to Afghans through a system tapping into donor funds seized since the Taliban takeover last August.

With the local economy “imploding”, the aim is to inject liquidity into Afghan households to permit them to survive this winter and remain in their homeland despite turmoil, it said.

Achim Steiner, the U.N. Development Programme s (UNDP) administrator said that Germany, a first contributor, had pledged 50 million euros ($58 million) to the fund, and that it was in touch with other donors to mobilise resources.

“We have to step in, we have to stabilise a  people s economy and in addition to saving lives we also have to save livelihoods,” Steiner told a news briefing.

“Because otherwise, we will confront indeed a scenario through this winter and into next year where millions and millions of Afghans are simply unable to stay on their land, in their homes, in their villages and survive. The implications of that are not difficult to understand,” he said.

The takeover saw billions in central bank assets frozen and international financial institutions suspend access to funds, although humanitarian aid has continued. Banks are running out of money, civil servants have not been paid and food prices have soared.

Steiner said the challenge is to repurpose donor funds already earmarked for Aghanistan, where the Taliban, the de facto authorities, are not recognised.

“Discussions over the last few weeks have focused on how we do find a way to be able to mobilise these resources in view of the economic implosion that is now unfolding and the international community s repeated commitment not to abandon the people of Afghanistan,” he said.