Post-Tsunami Recovery: Issues and Challenges in Sri Lanka

This research paper examines the impact of the tsunami that hit Sri Lanka on 26 December 2004. It was finalized after a December 2005 conference in Colombo  with stakeholders including government officials. It attempts to take stock of the reconstruction and recovery activities undertaken so far, make policy recommendations, and to identify challenges ahead. Three major lessons from this report also apply to other disaster reconstruction efforts worldwide:

1. Move fast with relief efforts.
2. Provide immediate cash payments to victims.
3. Expect reconstruction costs to soar.

ADBI has also prepared an Indonesian version of this paper to facilitate information sharing about post-tsunami recovery issues between Sri Lanka and Indonesia. A new introduction has been prepared by Thee Kian Wie. To extend this work, ADBI is supporting parallel studies on post-tsunami recovery efforts in Indonesia, Sri Lanka, and Thailand.

A team of researchers at the Institute of Policy Studies in Colombo, Sri Lanka, and the University of Melbourne, Australia, has jointly prepared the paper. It covers these areas:

• livelihood-related cash payments to households;
• assistance for rebuilding houses;
• titles to new houses;
• buffer zone rules;
• early warning and disaster management systems;
• coordination of donor assisted activities; and
• macroeconomic policy issues.

Looking ahead, overall macroeconomic management circumstances and policies will be critical to the reconstruction’s success. The tsunami hit at a time of serious macroeconomic imbalances and, paradoxically, helped to mask them for a time. The imbalances are now re-emerging, fuelling inflation, lowering the real value of aid funds, constraining the government’s fiscal capacity, and adversely affecting reconstruction.

The paper highlights the need for greater preparedness to cope with natural disasters. Building on the Sri Lanka Disaster Management Act presented to parliament in February 2005, a scientifically sound and financially feasible disaster management system geared to coping with multiple hazards must be formulated. Problems with aid utilization and accountability highlighted by the Auditor General’s Department must be urgently addressed.

This was originally published as an online discussion paper in November 2005. ADBI has now published this as an online and hard copy Research Paper. Some tables in the original discussion paper have been updated. Based on comments received, the authors updated some information.

The views expressed in this paper are the views of the author/s and do not necessarily reflect the views or policies of the Asian Development Bank Institute nor the Asian Development Bank. Names of countries or economies mentioned are chosen by the author/s, in the exercise of his/her/their academic freedom, and the Institute is in no way responsible for such usage.

Download this Research Paper [ PDF 1.5MB | 64 pages ].

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