KABUL: The Taliban announced a complete ban on the use of foreign currency in Afghanistan on Tuesday.

"The economic situation and national interests in the country require that all Afghans use Afghan currency in their every trade," the group said in a statement shared with journalists by one of their spokesmen.

The use of US dollars is widespread in Afghanistan's markets, while border areas use the currency of neighbouring countries such as Pakistan for trade.

The surprise move came hours after at least 25 people were killed and more than 50 wounded when gunmen attacked Afghanistan's biggest military hospital after two heavy explosions at the site in central Kabul.

Afghan acting FM asks US to lift ban on central bank reserves

The Taliban government is pressing for the release of billions of dollars of central bank reserves as the drought-stricken nation faces a cash crunch, mass starvation and a new migration crisis.

Afghanistan parked billions of dollars in assets overseas with the US Federal Reserve and other central banks in Europe, but that money has been frozen since the Taliban ousted the Western-backed government in August.

The departure of US-led forces and many international donors left the country without grants that financed three quarters of public spending.

The finance ministry said it had a daily tax take of roughly 400 million Afghanis ($4.4 million).

Although Western powers want to avert a humanitarian disaster in Afghanistan, they have refused to officially recognise the Taliban government.