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Treasury Embarking on 'Challenging' Task to Update Taliban Sanctions, Experts Say

Instead of imposing more sanctions against the Taliban, the U.S. will likely try to repurpose existing regimes to better target the group, sanctions and security experts said. The task, which the experts expect to be “very” challenging, will aim to update a U.S. sanctions program that was originally intended to target terrorists but will need to now target the Taliban-controlled Afghan government. The efforts should be coordinated with allies, the experts added, but could be slowed by the delayed nominations of two senior Treasury Department sanctions officials, who have not yet cleared the Senate.

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The U.S. sanctions regime for the Taliban was crafted in a “previous era,” Alex Zerden, who led the Treasury’s office in Afghanistan from 2018 to 2019, said during an Aug. 24 Center for a New American Security event. He said the regime is composed of counterterrorism sanctions, which have different legal authorities than country-wide sanctions.

“So that makes this very, very difficult and very, very broad in its scope, now that the Taliban has moved from an insurgency and terrorist group into the government of Afghanistan,” Zerden said. “The implications of that are very challenging.” He added that there isn’t a humanitarian carve-out for the U.S.’s Taliban sanctions, which will need to be updated if the U.S. hopes to permit aid into the country.

While other sanctions, such as the Global Magnitsky human rights measures, can be powerful, it remains unclear how much of an impact they will have on the group, Zerden said. “It's not like the members of the Taliban have bank accounts or have direct access to the international financial system,” he said. “So from a practical denial of revenue standpoint for current sanctions, further efforts may be more complicated.”

Annie Pforzheimer, a former State Department official in charge of Afghanistan, said “there really isn't a need for brand new sanctions.” But she said “there is a need for figuring out how to repurpose sanctions that were put on an entity that had a certain status, and now has de facto control over a huge country that has great needs.”

The U.S. can also use this as an opportunity to rethink how it uses sanctions, which have many “weaknesses,” said Pforzheimer, who is also an expert with the Center for Strategic and International Studies. “What are our tools of leverage?” she said. “If we overuse sanctions, and everybody knows this well, we will lose its capability as a tool of national security.”

But Pforzheimer said the “first of order of business” for the U.S. should be establishing a “genuine” humanitarian carve-out that will allow the delivery of aid to Afghan citizens. The U.S. also needs to determine how it will put in place “humanitarian channels” to protect remittances from being intercepted by the Taliban, said Rachel Ziemba, a CNAS expert. “Our experience in other countries like Syria and elsewhere is not great on this,” she said. “I think this is a really important test case of how the U.S. and its allies think about establishing some humanitarian channels.”

While Zerden said he has “full confidence” in Treasury’s civil servants, the agency’s efforts on many of these questions may be slowed because of delayed Treasury nominations. A dozen Republicans on the Senate Banking Committee said they plan to oppose the nominations for both Brian Nelson and Elizabeth Rosenberg (see 2106220037), both nominated for senior sanctions roles, until the Biden administration commits to more sanctions against the Russian Nord Stream 2 gas pipeline.

“These leadership positions are critical in times of crises, are critical for managing how Treasury can respond to these incredibly thorny issues,” Zerden said. “So I would just again reiterate the need to have confirmed leadership in place on these national security decisions.”