Cash Transfers key to rebuilding lives after South Asia floods
August 9, 2007 - Providing cash transfers to people affected by the floods that have devastated parts of Bangladesh, India, and Nepal is one of the most effective ways to help rebuilding lives and stimulate local markets, World Bank South Asia experts said today.
Shantayanan Devarajan, World Bank Chief Economist for South Asia, said cash transfers have proven a very effective immediate relief mechanism in previous natural disasters such as the tsunami and the Bangladesh floods in 2004, and the 2005 earthquake in Pakistan.
“Most people affected by the floods are poor and now they are losing their homes, livestock, and assets,” said Devarajan. “Cash transfers are a way of enabling these people to rebuild their lives. It also helps stimulate the markets which might have been depressed in the wake of a disaster.”
Christine Wallich, World Bank Senior Advisor for South Asia, said that it is also critical that relief assistance respond to the demands of local communities. “This usually entails drinking water, food, medications, and seeds to minimize the effects of a destroyed harvest. It is also essential to help households replace their lost livestock, which are very important for family nutrition (dairy) and for helping farmers in crop production.”
Assessment of the situation in the flood affected countries
Shantayanan Devarajan, World Bank Chief Economist for South Asia talks about the floods in South Asia. Listen to the interview below:
- World Bank's role in previous natural disasters (1m:34s) mp3
Flood assessment from Bangladesh
The 2007 South Asia floods have killed some 2000 people and left millions homeless. In Bangladesh alone, at least 300 people have been killed and eight million displaced according to news reports. Xian Zhu, World Bank Country Director for Bangladesh, who is based in Dhaka, said all the rivers surrounding Dhaka and Narayanganj have continued rising and flowing above danger levels. “The low-lying areas in the eastern part of Dhaka are already affected and this may continue to deteriorate if further rains set in.”
Zhu said the Government’s relief efforts are ongoing and they are working closely with development partners and other stakeholders on relief distribution. “Assistance in terms of food, clothing, and shelter has so far been provided to thirty-six of the thirty-nine flood affected districts. Government has also provided cash grants of about US$50,000 to flood affected districts.”
In addition to shortage of food and drinking water, health fears are rising. “Water-borne diseases such as diarrhea, dysentery, cholera, and typhoid threaten the flood-affected people who lack access to safe drinking water, medicine, and hygienic food,” Zhu said. “Some 40,000 cases of diarrhea have so far been reported and the situation may escalate if the flood continues.”
The World Health Organization estimates that there is a serious shortage of medical supplies, amounting to around US$2.5 million. “The development partners are working closely with the Health Ministry to mitigate this gap,” Zhu said. “We are trying to simplify procurement procedures in the health program led by the Bank so that medical supplies can be quickly delivered to the affected population.”
Response from International Community
Immediate relief and humanitarian support to the flood affected communities is being delivered through local NGOs, supported by the UN and other specialized agencies. “National and international NGOs, including BRAC and the International Federation of Red Cross, have geared up relief activities in the flood-hit districts by providing food, medical, water and sanitation support to the distressed population,” Zhu said. “The World Bank is closely monitoring the evolving flood situation and is working on various options to assist the Government in immediate relief operation and post-flood rehabilitation support.”
- Role of the World Bank in the flood affected countries (1m:12s) mp3
- Bangladesh success in managing floods (1m:15s) mp3
- Effect on Bangladesh garment industry (0:59s) mp3
Disaster Preparedness in South Asia
Despite the loss of lives and damage to vital infrastructure, Devarajan and Wallich said governments in South Asia are better prepared to handle such disasters today than a decade ago.
“Countries like Bangladesh have faced floods in the past, some more serious than the current one,” Devarajan said. “I am confident the government can respond to the situation given what they have learned.”
Wallich added that involving NGOs in relief activities and disaster recovery “ensures quicker food assistance and other relief activities. Thanks to strong government efforts, the population at large is also much more educated about safe water, the location of shelters, and the like, and knows what to do when disaster strikes.”
Asked how countries can prepare for future natural disasters, Devarajan said South Asia could benefit from a regional framework to manage such risks.
“The same floods are affecting three neighboring countries,” he said. “An early warning system could help mitigate the impact. When a river is rising 200 miles upstream information should be transmitted downstream, which can then enable neighboring countries to make cautionary adjustments and relocate people before the floods strike.”
The Economic Impact
The floods could have adverse economic impact on these fast growing countries. Devarajan said the primary concern is the potential for food and other commodity prices to rise sharply. “The way to mitigate this economic impact is to increase trade,” he said. “It is vital to bring in imported goods to replace commodities destroyed by the floods.”
While the impact on GDP growth is likely to be small, a disaster of this scale could pose a risk to some export industries, such as Bangladesh's garment industry. However, Wallich said road and embankment development has to date protected the corridor from Dhaka to the port, making it possible to continue manufacturing as well as exports.