Afghanistan: Taliban government bans online sales in foreign currency from July 5

Jul 05, 2022 | 03:03 UTC

The Taliban have banned foreign currency transactions across Afghanistan since July 5. The application is unclear. Possible business interruptions.

Event

The Interior Ministry has extended restrictions on foreign currency financial transactions across Afghanistan, citing Islamic laws. Taliban officials have banned digital foreign exchange and trading. Authorities have also clarified that people can only sell, rent and take out mortgages for Afghan land, houses, shops, markets, equipment and vehicles in Afghanistan (AFN). Violators will be subject to prosecution under Islamic Shariah. Taliban officials have not clarified whether the rule applies to foreign nationals in the country, and its application remains unclear.

The context

The Taliban have asked locals to use Afghans for domestic transactions from November 2021; however, reports indicate that authorities did not strictly enforce this measure. The latest announcement could indicate an attempt to improve enforcement levels as the Taliban continues to navigate an economic crisis fueled by international sanctions. Nearly 40% of Afghanistan’s gross domestic product depended on international aid before the Taliban took over. Afghanistan’s central bank still does not have access to the country’s $9 billion in foreign exchange reserves as human rights concerns continue to prevent diplomatic recognition of the Taliban administration.

Tips

Heed all official instructions. Plan for possible business interruptions, especially if you process online payments or pay capital expenditures in foreign currencies.


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David A. Albanese