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Karzai accuses foreigners of contributing to bank collapse

Posted by on April 12, 2011 0 Comment

Afghan President Hamid Karzai accused foreigners Monday of contributing to a corruption scandal at the country’s biggest lender, and vowed to impose Afghan terms on the country’s “strategic partnership” with the United States.

Meanwhile, Turkey said Monday it is willing to host a political office for Taliban militants from Afghanistan in order to promote talks to end the war there, and an Afghan official said Turkish planning is already in progress.
Politically well-connected Kabulbank lost hundreds of millions of dollars through fraud, bad loans and mismanagement, and the scandal has jeopardized the country’s flow of aid, because of disputes with the International Monetary Fund about how to handle it.

Karzai warned that those responsible for bad loans would have to repay within a month or face trial, and promised tighter regulations in future. But he also said foreigners helped plunge the private bank into crisis.

“Those who have committed these violations must be prosecuted,” Karzai told a news conference in Kabul.

“Foreign advisers, their institutions, with their wrong advice, and also possibly involved in corruption, also contributed to the huge problems at Kabulbank.” Karzai said investigators are now looking into the role of foreign governments and firms, and whether international “entities” encouraged the bank to take money abroad.

His comments are likely to rile diplomats in Kabul, who have been at loggerheads with the government for months over the bank’s fate, and have rejected any suggestion they had a hand in the collapse of a private institution.

Karzai also pledged to be tough in negotiating a new relationship with the U.S. as foreign soldiers prepare for a gradual security handover to their Afghan counterparts.

“The first condition of this strategic partnership is that they should bring us peace,” he said. “We have put forward many conditions and we have tied their hands and feet.” He called for a traditional “jirga” summit – a gathering of community elders – to review strategic ties with the United States, held in around two or three months.

Karzai’s government has long been plagued by accusations of endemic corruption which have strained ties with his Western backers.

The president’s brother Mahmoud Karzai is a shareholder too, but is not under investigation in Afghanistan. The president said he would face justice if found to have acted illegally.

In Ankara, meanwhile, Turkish Foreign Minister Ahmet Davutoglu said that he talked last month about hosting a Taliban office with Burhanuddin Rabbani, a visiting former president of Afghanistan who leads a peace council set up by the Afghan government to work toward a political solution.

“We discussed in detail their request to [establish] such an office and said that we are ready to do everything possible for this process,” Davutoglu said Monday on a trip to Hungary. “If there is such a demand, Turkey will help with full capacity.”

A Turkish Foreign Ministry official earlier said there was no official application to open a Taliban office in Turkey and that there were no immediate plans to host Afghan peace talks. The official spoke on condition of anonymity.

Arsala Rahmani, a member of the Afghan peace council, said Turkey is already making plans for the office but it will take time to work out.

A possible role for Turkey, the largest Muslim voice in NATO, in Afghan peace efforts would fit U.S.-backed initiatives to seek a political solution to the nearly decade-old insurgency amid a realization that military force alone is unlikely to end it.

“Turkey didn’t say no,” Rahmani said. “It is a key issue for resolving the situation in Afghanistan. It’s important for the Taliban to have a political address – a place – to talk to the world face to face.”

The council members say informal contacts have been made with Taliban figures, but no formal negotiations are under way. Agencies

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