Afghan money changing hands in a public market
Afghan money changers in Sarayee Shahzada market in Kabul.
Wakil Kohsar/AFP via Getty Images
  • Afghanistan's economy may be weeks from collapse, a former UN official said, per NBC News.
  • The World Bank and International Monetary Fund both said they would pause aid.
  • "The Afghan economy is being brought to its knees," said fellows at Chatham House think tank.
  • See more stories on Insider's business page.

A former UN official who previously worked on Taliban-related sanctions said the economy in Afghanistan may be weeks away from collapse, NBC News reported.

Hans-Jakob Schindler, a German former diplomat, told NBC that there may be weeks or a "couple of months" before economic failure. He said: "Then the economy is in deep trouble."

NGOs and international aid groups have called for quick action to avert an economic crisis in the country as the Taliban worked to replace key staff at some of the country's financial institutions.

It was reported last week that the Taliban was unable to get its hands on $10 billion in central bank reserves, because most of the funds were held in New York.

Leaders of the G7 said they would judge the Taliban by "their actions, not words."

But the international community also signaled it would pause or slow aid to the country. The World Bank has already paused its aid. The International Monetary Fund likewise said the country couldn't access millions while there was a "lack of clarity" over whether the Taliban government would be recognized.

A long line of Afghans in the sun outside a bank in Kabul
Afghans lining up outside a bank in Kabul on Wednesday.
Haroon Sabawoon/Anadolu Agency via Getty Images

News agencies last week published a series of photos showing long lines outside banks in Kabul, the capital, reporting that some Afghans were attempting to get hold of their money in cash.

Mark Bowden and Martin Barber, associate fellows at Chatham House, an international affairs think tank in London, discussed the situation in a blog post published on Thursday.

They wrote: "The Afghan economy is being brought to its knees by the closure of banks and offices receiving remittances, a collapse in the value of the currency, shortages of food and fuel in the cities, price inflation, the disruption of trade, and the inability to pay wages."

WikiLeaks, which in 2010 published secret documents about the war in Afghanistan, said on Twitter that 80% to 90% of Afghanistan's economy was "based on money put in by foreign security services and foreign aid."

"The upper echelons took the money and ran," WikiLeaks said. "It collapsed because the whole lot became corrupt."

Diplomats in neighboring Pakistan on Saturday said their country's priority was to stabilize Afghanistan.

One diplomat, Munir Akram, said Pakistan would be focused on providing humanitarian assistance and "reviving the economy," Pakistan's official publicity arm said via Twitter on Saturday.

Zahid Hafeez Chaudhri, Pakistan's high commissioner-designate to Australia, said, "Enhanced engagement by the international community will be critical for durable peace and development in Afghanistan. Viability of the Afghan economy after four decades of war and conflict needs to be ensured through development partnerships."

Read the original article on Business Insider