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Da Afghanistan Bank Empowered to Regulate Financial Sector

Kabul, Afghanistan - The Islamic Republic of Afghanistan has established a central bank, Da Afghanistan Bank (DAB), with the authority to regulate and supervise the country’s financial sector.

Key Responsibilities

The DAB will have autonomous powers to formulate and execute monetary policy, foreign exchange policy, and exchange arrangements. Additionally, it will be responsible for:

  • Printing and issuing afghani banknotes and coins
  • Acting as banker and adviser to the government
  • Licensing or registering banks, foreign exchange dealers, money service providers, payment system operators, securities service providers, and securities transfer system operators

Supervisory Powers

The DAB will also have the power to:

  • Enter offices and examine accounts, books, documents, and other records of financial institutions
  • Obtain information deemed necessary for supervisory purposes

Autonomy and Representation

The bank’s autonomy is guaranteed by law, and its members are prohibited from engaging in political activities while serving on the Supreme Council or Executive Board. The DAB will also represent Afghanistan in international meetings, councils, and organizations concerning monetary policy, licensing, and supervision of financial institutions.

Minister’s Statement

“The establishment of Da Afghanistan Bank is a significant step forward for our country’s financial sector. We are confident that this bank will play a crucial role in promoting sustainable economic growth and stability.” - Minister of Finance and Economics

Key Provisions

  • The DAB will have autonomous powers to regulate and supervise the financial sector.
  • The bank will be responsible for formulating and executing monetary policy, foreign exchange policy, and exchange arrangements.
  • The DAB will print and issue afghani banknotes and coins, act as banker and adviser to the government, and license or register banks and other financial institutions.
  • The bank’s members are prohibited from engaging in political activities while serving on the Supreme Council or Executive Board.
  • The DAB will represent Afghanistan in international meetings, councils, and organizations concerning monetary policy, licensing, and supervision of financial institutions.

Analysis

The establishment of Da Afghanistan Bank is a significant development for the country’s financial sector. With its autonomous powers and responsibilities, the bank is well-positioned to promote sustainable economic growth and stability. However, it remains to be seen how effectively the bank will be able to exercise its powers and fulfill its duties in a country with a complex and challenging political landscape.