• An estimated US$7.8 billion has been committed by the Government of Indonesia and the international community towards reconstructing Aceh and Nias
  
  
• By 2009, US$6.54 billion has been allocated to specific projects in the reconstruction portfolio, with an estimated US$4.8 billion – or 74 percent – disbursed by the start of 2009.
  
  
• The Government of Indonesia channelled almost all of its funds for the reconstruction effort through BRR. In 2005 BRR received US$407 million; US$638 million in 2006; US$855 million in 2007; and US$327 million in 2008. In April 2009, BRR successfully completed its operations in the province.
  
  
  

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In 2009, more than four years after the tsunami, the reconstruction of the province of Aceh in Indonesia is almost complete, with houses, infrastructure and social services to a large extent rebuilt and restored. It has been one of the largest reconstruction efforts in the developing world, with more than US$7 billion committed to rebuild the province, of which a large share has been already spent. Aceh's reconstruction has been a test case in many respects. It was led by a government agency, BRR, which was set up exclusively for that task. The international community committed an unprecedented amount of resources to the reconstruction of the province, adopting the objective of 'building back better', and came together in the form of the Multi Donor Fund for Aceh and Nias, a key coordination mechanism in the delivery of aid for Aceh. In Aceh, NGOs also played a key role, with almost a third of all resources and a very strong, and early, presence on the ground.

The reconstruction of Aceh was carried out in a relatively complex political environment. The province had been affected by a 30-year separatist conflict that was still ravaging the province at the time of the tsunami. Aceh's reconstruction was going to be an enormous task in the best of circumstances. The conflict compounded the challenge and, at the same time, the tragedy created an opportunity to escape the cycle of conflict. This situation called for a firm commitment from the national government, the local governments and population as well as the international community to work together in Aceh's reconstruction, raising above their differences and intensifying efforts to make the most of the window of opportunity that the end of the conflict in mid - 2005 presented.

Today, Aceh is in peace, reconstruction is well advanced and the economy has been growing steadily. It is important to recognize the progress made and give due credit to all parties involved, particularly the national and local authorities that have been working at a very intense pace since the tsunami. Still, the hard work is not yet over, as the province transitions from post-tsunami reconstruction to longer-term development. Aceh continues to have one of the highest poverty levels in Indonesia at 23 percent, despite being rich in natural resources. The national and local governments have ambitious plans for Aceh, and as a result of the peace agreement have made additional resources available for Aceh . Going forward, the Acehnese will drive the development of the province even more so that they already do now. In its post-reconstruction transition, Aceh will become a more normal Indonesian province sharing similar development challenges.

Financial Progress
Disbursements have been steadily rising since November 2005 and were about US$4.84 billion (74 percent of allocated funds) by early 2009. On average, disbursements have typically been about US$130 million per month up until 2009, which is just short of the expected disbursement of US$1.8 billion per year (about US$150 million per month). The disbursement rates from allocated funds vary significantly among key players. By early 2009, NGOs had disbursed 73 percent, Government of Indonesia 86 percent and multilateral/bilateral donors 60 percent. This is in part due to the different nature of the reconstruction projects undertaken by these groups.

Allocations and Disbursements

Sectors
Financial disbursements across sectors vary significantly, reflecting both the differing initial commitments, as well as the fact that some executing agencies have outperformed others in terms of progress to date. Disbursement rates in sectors might also be related to the long-term horizon of the agencies involved in those sectors. Agencies involved in so-called ‘more difficult’ sectors (such as transport, energy, or community development) have a longer planning horizon. Housing and health, sectors with high disbursement volumes, also benefit from stronger NGO participation.

Physical Progress
Measuring the physical progress of reconstruction is a complex task due to the large number of agencies implementing a vast number of projects. The Government’s reconstruction agency, BRR, has continuously required donors and implementing agencies to update their project progress on BRR’s online database, known as the RAN. Whilst most of the national and international humanitarian and charity organizations have been updating the RAN regularly, many of the larger international and multilateral donor agencies found updating of expansive data to be onerous.

The data are unlikely therefore to be accurate. However, it is the best information available on the progress of physical outputs. Members of the public can login into the system and monitor progress themselves: http://rand.brr.go.id/RAND/

Sources: ¹Damages and Losses Assessment, 2005. ²BRR, 2007.

The World Bank and BRR have been producing regular updates on reconstruction progress in order to provide transparency around the work completed to date by reconstruction players, and to highlight the remaining work required to be undertaken. Copies of those updates and other reports are available below.

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Financial Progress Data 
Summary of allocated funds - Aceh and Nias: download(3.79kb)
Summary of disbursed funds - Aceh and Nias: download(3.79kb) 
Summary of needs, projects, and gaps - Aceh and Nias: download(4.22kb) 

Published Reports

• Reconstruction Finance Update (April 2008):
  

  Aceh Tsunami Reconstruction Expenditure Tracking Update(pdf) | Presentation(.ppt)Â

  
  
• Recovery Framework:
  

  Indonesia: preliminary damage and loss assessment - The December 26, 2004 natural disaster		Indonesia : preliminary notes on reconstruction - The December 26, 2004 natural disaster

  
  
• 6 Month Rebuilding Report (plus video)

  Rebuilding a better Aceh and Nias : preliminary stocktaking of the reconstruction effort six months after the earthquake and tsunami| Watch the Video¹

  
  
• 9 Months After Report

  Rebuilding a better Aceh and Nias - stocktaking of the reconstruction effortsi

  
  
• 1 Year After Report

  Aceh and Nias one year after the tsunami: the recovery effort and way forward

  
  

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