The International Monetary Fund on Friday approved an $18.2 million disbursement to Afghanistan following the first performance review of the country”s new loan program.

The International Monetary Fund said Kabul had moved ahead on targets to draft a value-added tax law, set a strategy to fight economic crimes, and strengthen the central bank’s capitalisation framework.

The IMF suspended the Afghan program in 2010 after reports of corruption, bad loans and mismanagement at Kabulbank, forcing the central bank to rake over the major lender. A new loan program was renegotiated in November 2011.

The IMF has demanded that some of the assets of Kabulbank be recovered from shareholders, which include Afghanistan’s elite including sitting ministers and an ex-warlord.

IMF Deputy Managing Director Nemat Shafik said no shareholder of Kabulbank had repaid the authorities in full and their cases had been referred to a special court.

IMF deputy managing director Nemat Shafik quoted by AFP last week said, “In a very difficult environment, Afghanistan has begun a transition toward greater macroeconomic stability and economic self-reliance.”

“The authorities have also reported on asset recovery from Kabul Bank where cash recoveries have increased following a presidential decree,” she added.

“Going forward, the program will continue to focus on safeguarding the financial sector, strengthening economic governance, and moving toward fiscal sustainability. While progress has been made on all these fronts, strong government ownership of the program remains crucial to resist opposition from vested interests.”