While coastal industries struggle to recover, lessons are
being learned about the politics of development aid. June 26, 2005 marked
six months since the devastating tsunami that swept the Indian Ocean, often
called the first major natural disaster of the 21st century.
Rotary
Clubs in Thailand have stepped in and provided a tremendous amount of
assistance. Shown here is a shot of how a boat looked after the tsunami
destroyed it.
The world came together like never before to alleviate
the suffering of hundreds of thousands of people who lost family, friends
and loved ones, as well as livelihoods and belongings. Large parts of
cities, entire towns and villages, shops, schools and infrastructure were
destroyed or severely damaged. Government administration and public services
came to a halt.
With
help from the Rotary Club Eastern Seaboard, the same boat is now repaired
and able to provide this family with a hard earned, but nonetheless welcome
fishing income.
Tourism was only one of many coastline industries
affected, along with fisheries, coconut plantations and other forms of
agriculture. The poor were worst hit, especially women and children.
With the addition of India, the Maldives and Thailand,
the total reconstruction costs over the next three to five years are
expected to be between USD 9.8 billion and USD 12.5 billion. By the end of
May 2005, USD 6.7 billion had been pledged by donor countries, private
individuals and corporations, of which about USD 5.8 billion was pledged by
governments. However, records show that as of May 2005, only about USD 2.5
billion of the total amount pledged has been paid up.
After a
long time, the children were smiling again.
Thailand, arguably the worst affected in terms of tourist
casualties, was seeing occupancies of only around 20 percent in Phuket and
the neighboring islands and coastal areas as of June 2005. Airline capacity
was down significantly. Officials were turning to the domestic market to
prop up business.
Thailand also sought to use the Miss Universe pageant,
held in Bangkok on May 31, to convince TV viewers in about 180 countries of
an ‘all-clear’ message. The 80 contestants were flown to Phuket to be
videotaped on the beaches there, scenes that were edited into the live
coverage of the finals.
Given the fact that disasters and crises will continue to
occur, one major issue that has emerged is the financing of post-disaster
reconstruction and rehabilitation programs. Developing countries, already
struggling financially, find themselves having to divert their meager
extra-budgetary resources to relief efforts. Developed countries, which are
already providing vast amounts in the form of other aid packages, have to
find additional funds, some of which then carry strings attached before they
are disbursed.
On January 12, 2005, the group of countries known as the
Paris Club announced a debt moratorium for countries impacted by the
tsunami. This means they will not expect any debt payment on eligible
sovereign claims from those countries until December 31, 2005. The deferred
amounts will be repaid over five years, including a one-year grace period.
Interest accrued in 2005 will be capitalized and paid as deferred amounts.
At the World Economic Forum in Davos, Switzerland, French
President Jacques Chirac came up with a number of other proposals to raise
funds. He noted that the turnover of the world’s leading 100 companies was
over USD 7 trillion in 2004. The sum of the turnovers of the top two
companies alone is greater than the GNP of the entire African continent. And
yet, he said, "This globalized economy concerns only one-third of the
global population, a privileged minority in a world of insecurity. In 2006,
we will need to mobilize almost USD 50 billion of additional official
aid," President Chirac said, noting that this must not be done by
creating new international bureaucracies, but by using existing mechanisms,
streamlining them, making them increasingly transparent and increasingly
efficient. Among President Chirac’s suggested mechanisms include:
International financial transactions amount to some US$3
trillion per day. An ‘international solidarity levy’ could help raise
US$10 billion per year. He suggested that it should be: 1) A very low rate,
of a maximum of one ten-thousandth; 2) Applied to a fraction of
international financial transactions; and 3) Based on the co-operation
between major world financial markets so as to avoid the effects of evasion.
Capital flows/countries with bank secrecy: Ask countries
that maintain bank secrecy to partially compensate for the consequences of
world tax evasion, "which is so damaging to the poorest
countries," through a levy on flows of foreign capital in and out of
their territory. This levy would be allocated to development.
Aviation and shipping fuel: A contribution levied on the
fuel used by air or sea transport. "The fuel used by these sectors,
which contribute to the greenhouse effect and the pollution of our planet,
is currently practically exonerated from all taxation," President
Chirac claimed, a comment that many in the transport industry would dispute.
Airline tickets: Three billion airline tickets are sold
each year worldwide. A contribution of one dollar per ticket would raise at
least USD 3 billion, "without compromising the economic balance of the
sector," according to President Chirac.
Coordinated tax incentives: Every year, US citizens give
more than USD 220 billion to charity, 3 percent of which goes to
international causes. Large developed countries should set up coordinated
tax incentives that encourage everyone from individuals to the largest
corporations and financial organizations to donate for development.
Many tsunami-affected communities are looking forward to a new future as
much as they are coming to terms with their losses. At the same time, they
continue to struggle to attract normal levels of travel and tourism
business, which makes both looking forward to a new future and coming to
terms with loss that much more difficult. PATA is working hard through its
chapter network and media contacts to spread the message that visitors are
welcome and needed. Visit www.PATA.org/tsunami for more information.
