This week, with the world’s eyes on Kabul, the Group of 7 announced that they agreed on a plan to deal with the Taliban, "not just a joint approach to dealing with the evacuation, but also a roadmap for the way in which we're going to engage with the Taliban," with Britain urging new sanctions on the group. The announcement follows a report from the Wall Street Journal (WSJ) that financial institutions are exercising caution on transactions with Afghan counterparts as they await further guidance on whether U.S. sanctions on the Taliban apply across the country with the group now in control.
According to experts, the U.S. Treasury is “grappling with how to exert financial pressure on the Taliban” as it embarks on a “challenging task” to update existing sanctions, originally intended to target terrorism, to better target the group, who have historically paid “considerable attention to the sanctions regime, disliking it for the stigma it implies.” The experts added that such efforts should be coordinated with allies as China reiterates its support of the Taliban and “speaks out against [the] G7 threat to sanction hardline group.” Speaking ahead of Tuesday’s G7 meeting, Jefferey Sachs, one of the world’s foremost development experts, stressed the importance of a coordinated policy among the seven members “in preparation for actions by the far more important venue, the United Nations Security Council [noting that] without China and Russia at the table, there is no possibility of a coherent international approach to Afghanistan.”
For the Security Council, its own Analytical Support and Sanctions Monitoring Team suggested in a 2012 report that they “could take some steps to improve implementation of the sanctions regime,” and the confusion around it, with the Atlantic Council highlighting this week that “the Taliban is not specifically listed on any UN sanctions list, but it remains sanctioned [by the body] nonetheless,” underscoring the complexities involved with sanctions compliance. With the Taliban, coordinated sanctions by the international community, of which they seek legitimacy from, remains one of the most viable tools in ensuring the situation does not deteriorate any further. And for financial institutions, as they await further guidance and clarity, a comprehensive and unified view of risks posed is vital to their risk-based approach, not only to ensure compliance with the rapidly evolving landscape, but to prevent an even greater financial disaster for innocent Afghans, two-thirds of whom have never experienced living in the pariah state of the past.