Government counts costs of rebuilding ravaged Aceh
Leony Aurora, The Jakarta Post/Jakarta
As more images of destroyed cities pour in from Aceh, the government has doubled its initial projection for the cost of infrastructure reconstruction in the decimated province to Rp 10 trillion (US$1.07 billion).
Coordinating Minister for the Economy Aburizal Bakrie said on Wednesday the estimate was revised after discovering the level of devastation in Meulaboh, the capital of West Aceh regency located on the province's western coast, which bore the brunt of the fifth largest earthquake in the history of the world, followed by catastrophic tidal waves on Sunday.
"The reconstruction will begin in February (2005)," said Aburizal.
Vice president Jusuf Kalla said that the rehabilitation period would be between 2005 to 2006, while reconstruction would take until 2009.
The emergency fund needed to assist refugees, most of whom left their submerged homes with only the clothes on their backs, is estimated at Rp 1.35 trillion over the 12 months.
"(The funds will be collected) from the people," explained Aburizal. Donations from the business community, which thus far had reached Rp 50 billion, and financial aid from foreign institutions and governments was also expected, he added.
The donated money will be used to provide food, clothing, medical supplies and other necessities.
Several aid agencies and health officials fear that famine and disease are imminent for the tens of thousands of refugees as food supplies were running out and humanitarian relief was still being held in Medan due to transportation difficulties.
Humanitarian aid groups have also expressed concern about possible outbreaks of cholera and other ailments as there were difficulties in obtaining clean water and hygienically prepared food.
The Ministry of Finance's treasury directory Mulya Nasution said that the government could disburse Rp 200 billion from this year's budget in the next two working days, should there be a request from the National Disaster Management Coordination Board (Bakornas PB).
"In the 2005 budget, we also have Rp 2 trillion of emergency funds available," he said.
The government urgently needs financial assistance if it is to help the victims of the earthquake and tidal waves, as its budget deficit is still a huge problem.
The deficit is expected to soar to more than Rp 26.3 trillion, due to record high crude oil prices, which have dramatically increased its share of fuel subsidies in the country.
Fuel subsidies have almost tripled from the original projected allocation of Rp 26.4 trillion to Rp 73.8 trillion.
The cash-strapped government has announced plans to raise fuel prices next year to minimize subsidy costs.
Some analysts believe that the earthquake disaster might help silence the staunch critics of the fuel price hikes, given the urgency of accumulating budget funds to help people in Sumatra.
However, economists such as Chatib Basri of the University of Indonesia disagreed.
"I think if the fuel price hike is applied now, it will be politically risky. Even if those extra budget funds would go to the needy Acehnese, will non-Acehnese want to carry that burden?" said Chatib.
Chatib said a hike in fuel prices and drop in the government subsidy needed to be thoroughly explained to the public. When the hike is implemented, the subsidy savings could go to various funds, particularly the Aceh reconstruction fund.