It ain’t cheap to run a country.
That is what experts are saying the Taliban will soon find after the Biden administration’s decision to abandon Afghanistan was followed by a hostile takeover of the nation by the militant group.
"I expect the Taliban will be somewhat strapped for money. Running a country like Afghanistan is expensive, in particular because the vast majority of the population lives below the poverty line. And so foreign aid had been paying... I believe upwards of 70% of the government budget. So that's going to dry up," predicted Gretchen Peters, executive director of the Center on Illicit Networks and Transnational Organized Crime (CINTOC).
"I think we're looking at a human and potential humanitarian catastrophe for millions and millions of Afghans. And I am not optimistic the international community is going to be able to or have the appetite to respond to that. So it's very, very worrisome," the CINTOC director continued.
Additionally, those same experts are warning that this dearth of funds and resources may soon lead to the Taliban doubling down on illicit activities such as drug trafficking.
The consequences could be dire.
"When any criminal organization controls the institution of state, they have the capacity to move money through banks, to control border crossings, to open up airstrips around the country for smuggling," said Peters who has consulted with the U.S. Defense Department and law enforcement on transnational crime and terrorism.
Indeed, the Taliban has long been a major player in the world’s drug trade. An astonishing 83% of the global opium production – a virtual monopoly – was estimated to come from Afghanistan between 2015 and 2020, according to the United Nations Office on Drugs and Crime (UNODC).
Furthermore, the U.N. Security Council estimated that the Taliban’s annual combined revenues are as much as $1.6 billion a year, according a report this past June. Roughly $460 million of those revenues are said to come from taxes on the sale of heroin moving throughout Taliban territories alone.
Those numbers are expected to rise with the Taliban gaining control again. One industry veteran believes that action needs to be taken immediately.
"Over the past 20 years, [the Taliban has] raised more and more money on the drug trade, both heroin and opium, as well as now methamphetamines… there should be a larger international consensus, not just of allies, but of some adversaries as well, to address this drug problem," said Alex Zerden, former Treasury Department financial attaché in Afghanistan.
Recently, the international finance community has banded together in cutting off funds to Afghanistan.
The U.S. froze nearly $9.5 billion in assets belonging to Afghan’s central bank to go along with the International Monetary Fund (IMF) and World Bank’s decisions to suspend aid to the country last week.
Zerden – who led the Treasury Department office at the U.S. Embassy in Kabul from 2018 to 2019 – agreed with the moves, saying it was smart policy but there were still lingering issues to confront, including the renewed threat of terrorism.
"There are a number of terrorist groups, including al Qaeda, which operate in Afghanistan currently today. And then there are a number of other insurgent groups in the region which they could proliferate weapons to, which is very terrifying," he warned.
Zerden expressed concerns about solely implementing financial sanctions. He pointed to the Taliban’s survival for the last two decades as the largest evidence.
"The Taliban has been incredibly self-sufficient. They’ve been able to self-fund and receive foreign support outside of the U.S. financial system for the past 20 years, [making] enough to take over the country in 11 days," the Treasury Department alumnus stated.