Sri Lanka’s progress in post tsunami recovery has been rated as slow according to a report in the Asian Development Bank Outlook (ADO) 2005 Update released last week.
It cited political impediments to recovery as one of the reasons for slow progress.
In an examination of the impact of the tsunami on poverty, ADO 2005 described two scenarios of recovery fast and slow. Under the fast-recovery scenario, assumed to take 2–3 years in most of the countries, poverty caused by the tsunami would be eliminated by 2007 in all countries except Indonesia, where the additional number of poor would still be around 345,000 that year (See table).
If the recovery process took longer 4 to 5 years (the slow-recovery scenario) the additional number of poor would be 1.1 million in 2007. So far, the record among the countries is uneven, the ADO Update said.
“Thailand has restored many of its coastal resorts and is waiting for tourists to return in large numbers. Likewise, most of the resorts in the Maldives are back in operation, and the industry hopes to see a complete rebound by the end of 2006, about 2 years after the tsunami,” it said. As of July, tourist arrivals were about 70% of last year’s level.
Noting that the tsunami caused much more damage in Indonesia, Sri Lanka, and India, the ADOP Update said these countries face greater problems with the management of reconstruction programs.
“There are also political impediments to recovery in Indonesia and Sri Lanka, where rebel groups control parts of the tsunami-affected areas,” it said. Progress in Indonesia was initially slow because of the time it took to establish the Rehabilitation and Reconstruction Agency, which will play a central role in managing recovery programs.
Now that the agency is in place, and a peace agreement has been reached between the Government and separatist rebels in Aceh, the reconstruction process is expected to accelerate. If the agency functions as expected, Aceh may be rebuilt in 4 years.
“In Sri Lanka, it took some time for the Government to agree on establishing a system to distribute aid in areas controlled by the Liberation Tigers of Tamil Eelam, and there are still disputes over involving this group in the reconstruction. As a result, recovery has been hindered. In the absence of a durable agreement between the Government and rebel groups, it would be premature to conjecture when reconstruction might be completed,” the ADO Update said.
The December 26th Indian Ocean tsunami devastated coastal areas in Indonesia, India, Sri Lanka, Maldives, and Thailand, destroying families and communities, houses, fishing boats, farms, and other assets, and dragging at least 2 million people into poverty (Asian Development Outlook 2005). In the 8 months since then, significant financial resources have been directed at providing initial relief and on starting to restore local economies. There has been a stronger focus on generating work and involving the communities than in past disaster-recovery programs.
In Aceh, Indonesia, where an estimated 600,000–800,000 jobs were lost because of the tsunami, up to 35,000 people are employed in clean-up operations. In Sri Lanka, 87% of households in the affected areas suffered the loss of their main income. Now, 60% of these households have regained some source of income, mainly through temporary manual labor programs. These programs not only provide income but also help address the psychological trauma as people take an active part in the recovery and rebuilding of their communities. Overall, the initial relief operations appear to have succeeded. The recovery effort is now moving to the medium- to long-term process of reconstruction—from cash-for-work programs to restoring local economies, since clearly, such programs alone will not restore sustainable livelihoods. However, restoring local economies will take much longer in some places than others.
The report also said that India is focusing on restoring the fishing industry, housing, infrastructure, and rural livelihoods in mainland states. Thousands of fishing boats are working again; electricity, water, and transportation links are coming back into operation; and livelihood programs are being undertaken through self-help groups. However, the full reconstruction program is still in preparation, with land acquisition, development planning, and engineering design requiring more time. More attention is needed on these preparations, as it is on the Andaman and Nicobar islands, so that the overall recovery in India’s affected areas is speeded up.
It appears that the fitful progress on recovery achieved so far in the five countries may well mean that the additional number of poor in 2007 could exceed 600,000.
Commenting on the challenges, the ADO Update said in addition to the issues outlined, three other main challenges need to be addressed to speed recovery and ensure that the disadvantaged are not left behind in the rebuilding effort. These emanate in large measure from difficulties in restoring the informal economies of the affected areas, and from problems in reestablishing property rights.
First, relief programs, even relatively successful ones, leave gaps in their coverage. Priority is often given to people who are registered with the authorities, such as owners of businesses. Registered fishing communities are more likely to receive assistance for rebuilding or buying new boats than those in more isolated areas and without licenses. Farm workers, small-scale traders, casual laborers, and others in the informal economy tend to be left out, too. Second, land-ownership issues remain a serious problem for many people trying to rebuild.
In some cases, ownership was recorded only in the name of a family member killed in the tsunami. For others, all copies of records were destroyed.
And the very shape of some coastal areas was changed by the huge waves that washed away land.
Third, other problems have arisen. Bouts of localized inflation and contraction in banking credit have aggravated the suffering in some tsunami-hit regions.
Inflation in Aceh, for example, is running at 17%, or more than double the national rate, mainly due to demand pressures created by the presence of aid agencies and the reconstruction work getting under way. Banks have faced difficulties in assessing credit risks when records have been lost and collateral destroyed.
ADO Update also noted Building up local economies from scratch is an enormous undertaking. It requires investment in infrastructure; the creation of jobs and support for sustainable livelihoods; and efforts to put back together the institutional and informational fabric that supports commercial activity.
ADO Update notes that progress is obviously being made - but at different speeds in different places. Although the macroeconomic impact of the tsunami is limited, its impact will endure in the affected localities, with the additional number of poor still at a high level in 2007. Minimizing economic hardships will require greater efforts to address the bottlenecks to recovery and to ensure that the assistance covers those who are being bypassed, it emphasized.