Nepal pleads for funds
Nepalese Finance Minister Ram Sharan Mahat yesterday used a gathering of 3,000 people from around the world in Baku to plead for global help as his earthquake-ravaged nation struggles to raise funds for rebuilding.
“It is with great pain and sadness that I stand before you to present the case of my country which now remains devastated. The massive earthquake has resulted in incalculable human loss and suffering, with millions of people rendered homeless. The scale of destruction of physical and social infrastructure is immense with hardly any school or health post intact in the most affected districts,” he said.
As desperation grows among the survivors in Nepal, Asia's second poorest country, Mahat said he is grateful to the nations that dispatched assistance and relief materials, but it is a massive task to put the country back on track.
The cost to rebuild Nepal after its most devastating earthquake in eight decades will exceed $10 billion and take years, Mahat said at the annual meetings of the Asian Development Bank in Baku, the capital of Azerbaijan, where he was invited to speak by ADB President Takehiko Nakao to highlight his country's plight.
His reconstruction estimate is equivalent to about half of Nepal's $20 billion economy.
“This is the crisis that we have never imagined will happen,” Mahat said.
Nepal is overwhelmed and it cannot fight it alone. About a third of Nepal's 30 million people have been affected by the quake, with 1.4 million in need of food assistance.
The death toll from the 7.8-magnitude quake on April 25 currently stands at 7,056. More than 15,000 people have been injured.
“There are still villages where we know that all houses have been destroyed, but have not yet been able to reach. The aftershocks have not receded, and we expect the final casualty numbers to climb much higher,” the minister said.
Fourteen of the 75 districts of Nepal have been declared crisis-hit, which account for 20 percent of the country's population, and have about 1.2 million households.
Nearly 300,000 houses have either been completely or partially destroyed. This unprecedented calamity has struck the country just eight months after massive floods and landslides swept away dozens of villages in the mid-western Nepal rendering more than 5,000 families homeless who are still waiting to be rehabilitated.
When the last comparable earthquake occurred in 1934, there was hardly any modern building or road, school or motorised vehicle. The pace of transformation in Nepal in the years after the 1934 earthquake has been remarkable. The nation that jumped from a medieval kingdom into a nation-state of the 21st century in about half a century now stands in ruins.
“Thousands of people have been evacuated and they need medical treatment. We need medical help. People lost their legs, broke their backs and suffered head injuries. They need immediate surgeries. We need more medical supplies,” the Nepalese finance minister told reporters.
“Many people are without food. Those in remote areas are not getting anything. Those places are inaccessible. Roads are bad. We need helicopters to take foods to those areas, but the capacity of helicopters is limited.”
“More than 10,000 government buildings have been destroyed and it requires a lot of money to rebuild them. World heritage sites have been destroyed. Reconstruction requires a huge amount of fund.”
As an initial effort, Nepal has set up a $2 billion national reconstruction fund, with the government putting in $200 million immediately, Mahat said.
“We are counting on the generous support from our development partners to help us in this task. The amounts I just stated are in addition to about $500 million needed for immediate humanitarian assistance during the rescue and relief efforts.”
The earthquake threatened to set Nepal back in development efforts. After a decade-long insurgency and political instability, the Himalayan nation had just begun gearing up for a higher trajectory of economic growth.
Over the past year, Nepal made a transformative leap in the energy sector by signing a power trade deal with India and contracts to develop mammoth hydroelectric plants that would put the country on a course to increase electricity generation by 10 times in a decade.
“We have also been working on the next generation of economic reforms, enacting or revising about 40 policies, acts, and regulations. We expected this hard work to pay off with higher growth, but this momentum is now about to be disrupted,” Mahat said.
It is likely that progress in the social sector such as cuts in infant mortality and access to improved sources of water and sanitation may come to a halt. Tens of thousands of people who had just crossed the poverty line run the risk of falling back into absolute poverty.
Nepal's Millennium Development Goals' indicators could suffer a setback, according to the minister.
Nepal is struggling to provide shelter to about half a million people. The monsoons are coming in less than two months. Pre-monsoon rains are already slowing rescue and rehabilitation efforts.
“We are getting complaints from the victims they need shelters. They need roofs over their heads. They need tarpaulins and tents because the monsoon is coming. So I asked the international community to provide those materials,” the finance minister said.
“It will be another disaster if we can't provide tents and other supplies over the next week or so.”
“We need long-term assistance to help rehabilitate these victims. In the next two or three years, we have to provide low-cost housing to the survivors.”
Nepal's economy was already slowing before the earthquake struck. The ADB had forecast the country's economic growth for the year ending July 15 at 4.6 percent, down from 5.2 percent in the year earlier.
Mahat said much of the economy was wiped away by the quake, but cautioned it was too early to make an assessment of the economic impact.
Still, dismal details are aplenty. The housing industry has been hit badly with assets destroyed. It will take years for the sector to regain the confidence of consumers.
After the bubble burst in the real estate sector five years ago, it was slowly beginning to revive, but will now stall with some businesses possibly going bankrupt, Mahat said.
The fast-maturing banking sector has had an important role in supporting the real estate sector; now its profits are likely to decline. Much of Nepal's tourist attractions are in central Nepal, and tourism could slow down.
Communications and electrical industries have also suffered damage. Industrial supply chains have been weakened, and prospects for the revival of manufacturing have dimmed in the immediate run. Up to 10 hydro-electric plants generating about 90 megawatts of electricity have shut down temporarily.
Looking forward, Mahat made a solemn pledge: “We will rebuild our country. We will rebuild it better. We will come out of this crisis stronger.”
“But to support our resolve we will need the goodwill of our development partners.”
The ADB as a long-term development partner last month signed $3 million in grants to finance relief efforts in Nepal. It will be followed by up to $200 million in additional resources for projects in the first phase of rehabilitation in the South Asian country.