The Dec. 26 tsunami that killed more than 150,000 people in Asia has thrown up reconstruction challenges in terms of finances, logistics and infrastructure needs, apart from the immediate needs for relief to counter disease outbreaks and privide food and shelter to homeless millions.

"We have estimated it would cost between $1.2 billion and $1.5 billion to rebuild and repair damages to railways, ports, industries, fishing harbors, tourists resorts, housing and wildlife sanctuaries," says Dr P.B. Jayasunderan, the additional secretary in Sri Lanka's ministry of finance in Colombo.

The Indonesian government has said it will need $1billion for reconstruction in the Sumatra region, which faced the burnt of the tsunami.

Many of the affected areas are coastal villages, where fishing and farming are the main occupations, and major construction projects are rare. In Sri Lanka, where the 900-km long seacoast was inundated, the major damages include a 72-km highway connecting Colombo to the port city off Galle, several railway bridges and 24 beachside hotels, including a 5-star hotel, the Taj Exotica.

At Banda Aceh, capital of the Indonesian province of Aceh, which suffered the most among all Asian regions, the damage to infrastructure include damage at the local airport and at a diesel-fired power plant, along with the power utility's offices and distribution lines. The country's energy ministry says the state-run utility, PT Perusahaan Listrik Negara, has suffered damages worth $53 million.


The airport at Banda Aceh also saw a freak accident Jan. 5, when a Boeing 737 cargo plane skidded off the runway, forcing closure of the airport and the suspension of relief activity. There were no casualties.

Sri Lanka's Urban Development Authority is working with officials of the United Nations Development Program to draw up a tentative plan for a recovery and reconstruction effort in the affected areas that will recharge the economic life in the stricken areas, which has been devastated.

"A lot of damage has been caused to the port city of Princomalee, the Galle harbor and the connected industrial free trade zone besides the trading towns of Jafna and Matare," says M. A. Hassen, an information department official in Colombo. He said 91,000 houses and 41 schools have been destroyed, and 25,000 houses and 200 schools have been partially damaged, he said.

Funds and material for immediate relief have come in from many sources. According to the United Nations, 40 donor countries have pledged $2 billion for initial relief operations. But serious questions loom over the prospects for long-term financing for rebuilding high-cost projects which may, in the wake of the transformation, no longer prove financially viable.

Indonesian officials anticipate significant multinational donor support for recovery, although one senior official in the finance ministry in Jakarta suggested "This should be seen as an opportunity to build up the economic life in the affected region with new infrastructure projects. The challenge is in attracting new and low-cost technologies that are suitable to the region, and involve private companies. If it is left in the hands of aid agencies, I do not see much long term development taking place," he said.

The World Bank has announced an initial contribution of $250 million for emergency reconstruction. The Asian Development Bank is offering up $325 million by quickly reprogramming existing operations in Indonesia, Maldives and Sri Lanka, and drawing also from its low-interest lending fund. ADB said it is working jointly with the World Bank and United Nations agencies to prepare more detailed damage and reconstruction needs-assessments to help lay the basis for the more extensive and comprehensive reconstruction work during the next six months.

U.S. Secretary of State Colin Powell flew into the region on 4 January promising long-term reconstruction and rehabilitation aid from the U.S. of $350 million.