ADB releases immediate assistance of $200 million
Asian Development Bank (ADB) today announced an immediate assistance of $200 million for helping Nepal’s reconstruction process. It is a part of $600 million fund pledged by the development partner in the International Conference on Nepal’s Reconstruction-2015 (ICNR 2015).
“ADB’s board yesterday approved $200 million in earthquake emergency assistance, to rebuild and restore schools, roads, and public buildings,” ADB president Takehiko Nakao said, in a press meet organised on the sidelines of ICNR 2015, at the ADB Mission Kathmandu office, today.
“I truly believe that Nepal will emerge stronger from this catastrophe and continue along the path of inclusive and sustainable growth,” he added.
ADB’s board of director yesterday has approved $200 million earthquake emergency assistance, which was first announced in late April, shortly after the devastating earthquake on April 25, for ‘Build Back Better’ Nepal.
Ninety per cent of the assistance will go towards infrastructure projects, Nakao said, informing that ADB is ready to provide up to $400 million in further assistance, which would bring total assistance to $600 million.
In addition to the $200 million emergency assistance, a further $50 million is being provided. It includes a $3 million disaster relief grant, $30 million in budget support for rural finance, and a $15 million grant from the Japan Fund for Poverty Reduction (JFPR).
Earlier, ADB had suspended grant aid to Nepal in 2014 citing the country’s improved capacity of debt servicing and JFPR assistance being provided now is only because of the devastation caused by the earthquake of April 25. ADB had released $3 million immediately after the quake to support the government’s rescue and relief operations.
The subsequent phase of reconstruction, ADB can also allocate up to $350 million from its existing projects without affecting ongoing and planned development programmes.
Commending the ‘self-help spirit and solidarity’ shown by the people of Nepal, he also hailed Nepal government’s ‘strong leadership’ in conducting post-disaster needs assessments with development partners, and planning reconstruction efforts.
Nakao also highlighted five principles for effective reconstruction; build back better, inclusiveness, robust institutional set up for reconstruction, government capacity improvement and effective donor coordination and government ownership that is critical to successful reconstruction.
Under ‘build back better’ principle, buildings will be rebuilt to earthquake-resistant standards, whereas special attention should be paid to the needs of the poor, rural residents, and other vulnerable social groups, who have suffered more from the earthquakes under inclusiveness, he said, adding that the need for a robust institutional set up for reconstruction is key, apart from strong leadership that is critical for the success of the reconstruction agency. “Likewise, the importance of improved capacity of the government with a sound governance and fiduciary risk management system should be in place for effective aid utilisation.”
Amid concerns about the corruption and possible mismanagement, the chief of Manila-based regional development bank said that the proper procurement policies, civil society group and media vigilance, regular disclosures and supervision of corruption watchdog could help in fiduciary risk management.
Nakao also stressed that reconstruction needs should not derail Nepal’s broader development endeavors. “Hard won gains made before the earthquake in poverty reduction, private sector-based growth, and political stability should not be compromised by the tragedy,” the ADB president said, suggesting, “reconstruction should go hand in hand with development programmes already planned.”
ADB informed that emergency assistance of $200 million will help rebuild at least 700 schools (approximately 7,000 classrooms) to disaster-resilient standards in the earthquake-hit districts.
Likewise, the assistance will also be utilised to rehabilitate around 135-km of strategic roads and 450-km of district roads to re-establish links to worst-affected areas.
Furthermore, it will finance rebuilding or retrofitting of about 300 district-level government buildings to disaster-resilient standards and provide training regarding the preparedness and risk management skills development of about 500 government staffers in implementing agencies.
ADB has also assured that it will also co-finance with other new mechanisms like Asian Infrastructure Investment Bank (AIIB) and Green Climate Fund (GCF) – to help meet the financing needs of Nepal – in the future. “Earthquake is a tragedy, but it should not impact human development, poverty reduction and economic growth,” Nakao said.