Damage and Costs

In the cases of Indonesia and Sri Lanka, the largest economic losses from the tsunami came from damages to physical infrastructure and property. In contrast, Thailand’s biggest source of losses was estimated to have come from productive sectors, particularly tourism, because the most severely affected areas were key tourism destinations. As a result, initial estimates of analysts led to forecasts of significant reductions in the GDP growth rate. JP Morgan, for example, revised the first quarter growth rate of 2005 to zero from the previous projection of 3 per cent. The 2005 annual GDP growth rate was also revised downward by 0.3 per cent to 5.7 per cent. Similarly, Morgan Stanley reduced its annual growth projection from 6 per cent to 5.7 per cent, citing, in particular, the dampening multiplier effects on the economy of the damage caused by the tsunami on the tourism industry.

Figure 1 provides data on the six Thai provinces hit by the tsunami. Of the six, Phang Nga, Phuket, and Krabi were the most severely affected. Phang Nga—in particular the Kao Lak and Ban Nam Kem areas—suffered the most in terms of human and economic losses (79 per cent of the total 5,395 casualties) (Table 1 [ PDF 69.8KB | 1 pages ] and Figure 1 [ PDF 89.2KB | 1 pages ]). Krabi sustained the second heaviest loss of life (13 per cent), but damages to infrastructure and the business sector were higher in Phuket, which suffered the most serious damage to infrastructure of around $100 million. Ranong, Trang, and Satul, which are not tourist destinations like the other three provinces, suffered mainly from damages to aqua culture and destruction of fishing boats and equipment.

The initial relief efforts in Thailand were complicated by the need to deal with a large number of dead, injured, and missing foreigners. In most locations Thai casualties were higher than those among foreigners. However in Phang Nga, a major centre of tourism with the tourist season at its peak, foreign casualties exceeded Thai casualties (Figure 2 [ PDF 89.3KB | 1 pages ]). In addition, foreign casualties in Phang Nga also included a large number of migrant workers from Myanmar. Only eight foreigners reportedly lost their lives in Ranong and Trang. The 2,817 missing persons, most likely dead, suggests that large numbers were probably dragged into the sea by the giant waves.

The impact of the tsunami was spread over a large number of villages in these provinces, which made provision of immediate relief difficult. Krabi had the highest number of affected villages, but not the largest number of casualties (Table 2 [ PDF 84.7KB | 1 pages ]).

In total, the tsunami directly affected 12,815 households comprising more than 58,550 people. A total of 3,302 houses were destroyed and 1,504 were damaged (Table 2). Phang Nga accounted for 52 per cent of total house destruction, followed by Phuket with 21 per cent, and Krabi with 14 per cent.

Damages to business properties accounted for most of the damage in Phang Nga, Phuket, and Krabi while damages to the fisheries sector were the most important in the other three provinces (Table 3 [ PDF 84.7KB | 1 pages ]). These differences in the nature of damages between the two groups of provinces meant that they required quite different rehabilitation and reconstruction activities: Phang Nga, Phuket, and Krabi needed urgent measures to restore tourism and business properties, while Trang, Ranong, and Satul required assistance to restore the fisheries industry.

Most of the losses inflicted on people’s livelihoods (88 per cent) came from the damage to business properties in Phang Nga, Phuket, and Krabi. Most of these properties were hotels, which were critical to the tourism industry. Fisheries was the second most affected sector (12 per cent) while damage to livestock and agriculture was negligible. In Phang Nga, though most of the damage was to business properties, the fisheries sector was also significantly affected (Table 4 [ PDF 85KB | 1 pages ]). Many fishing boats were lost or damaged, and there were extensive damages to fish cages and shrimp hatcheries (which in turn affected the wider southern shrimp industry, which relied on supplies of post-larvae from these hatcheries).

The total damage to roads and bridges was relatively minor (estimated at less than $2 million). This also meant that emergency relief and assistance could be delivered relatively quickly immediately after the tsunami. The more costly damage to infrastructure came from the numerous damaged piers, which delayed fishermen from returning to their normal livelihoods (Table 5 [ PDF 85KB | 1 pages ]). Twelve schools were either destroyed or severely damaged, while another twelve suffered mild damage.

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