Summers Sees Taliban Facing Economic Challenge as Aid Dries Up

Afghanistan faces a looming economic challenge as foreign aid and spending dries up, which could provide leverage for other nations in dealing with the Taliban, former U.S. Treasury Secretary Lawrence Summers said.

People are underestimating the economic crunch facing Afghanistan as foreign troops and aid groups withdraw amid the Taliban’s takeover, Summers said in an interview Friday on Bloomberg Television’s “Wall Street Week.”

“The Taliban is going to find its victory very challenging. Afghanistan was an economy supported largely by foreign aid,” Summers, a paid Bloomberg contributor. “All of that is going to dry up and that’s going to make governing Afghanistan extremely difficult and it may, a few months from now, be a source of leverage for people on the outside with respect to what happens there. They’ve got big economic challenges ahead, much larger than what people are recognizing.”

Summers downplayed the potential domestic political fallout for U.S. President Joe Biden, saying the spillover from foreign policy crises into domestic political opinion is often less than expected. The political impact will hinge on what happens in the next few weeks as the U.S. withdraws, he said.

“If we are substantially successful with respect to the evacuations and this doesn’t dent the president’s overall standing, I don’t think the effect is going to be very large,” he said. “If the president loses 10 approval points, all bets are off on his ability to move major legislation.”

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