World Leaders Meet in Indonesia for Tsunami Emergency Relief Summit

MARGARET WARNER:

Joining me now by phone from Jakarta is the World Bank's Andrew Steer. He's the bank's country director for Indonesia, and he attended today's summit.

Mr. Steer, welcome. Thank you for joining us. What the most important thing was that came out of today's summit?

ANDREW STEER:

I think the most important thing was that we've now established that there is a remarkable response to this great tragedy, and that the challenge from now on will be to figure out how to move forward, how to use these funds in a productive, transparent way so that a year from now, two years from now, we'll be able to look back on this great tragedy and see a response that was truly effective.

MARGARET WARNER:

The headline that we got halfway around the globe was also Kofi Annan's call for the countries that have pledged all this money to actually come up with the cash.

Was there any sense at the meeting of how much of the $4 billion that's been pledged has actually been dispensed by these countries?

ANDREW STEER:

Well, of course, you know, we have to divide the whole process into several stages. There's the immediate stage. We're now ten days into this crisis. There are funds being disbursed now, but it's very, very early days.

And the next sort of six months will be this immediate relief period, and then we move into a reconstruction phase, and of course, the real challenge is to figure out how to restore people's lives and livelihoods. And that is only beginning.

There certainly is a danger, as you suggest by your question, that these very generous pledges will turn out not to materialize, not necessarily out of bad intentions, but because moving forward now it's actually quite difficult to figure out, for a place like Aceh, how to spend the money wisely and transparently in a coordinated manner.

MARGARET WARNER:

Give me an example. For instance, the World Bank pledged $250 million as its first contribution. What has the bank actually done with that money? What is the bank actually doing?

ANDREW STEER:

Well, today we expect the funds to be much more than $250 million actually, but for example, today we will… take Indonesia, for example.

We will sign a memorandum of understanding with the government so that by the 10th of February, we will have negotiated four specific projects, adding to well over $250 million.

And about three weeks from today, we will disburse the first money. We're very fortunate. We have a network of several hundred facilitators already in Aceh. These are Acehnese. They are currently trying to figure out what the needs are.

We will be channeling funds to about 12,000 villages within Aceh. The villagers themselves will start deciding how to use the money on the most basic sort of recovery and rebuilding efforts. And that can start almost immediately.

Now, there are other aspects which will take a longer time. For example, many villages have disappeared altogether. The question is: Should they be rebuilt? How should they be rebuilt?

The answer to that is not to try and make decisions in Washington or New York or even Jakarta. One has to go and figure out what the existing villagers, who may not even be living there anymore, what do they want? What are their aspirations? And how do they see the rebuilding effort? Would it be a village that's the same as the one that's totally destroyed, or would it be something different?

And this is an issue that the government is actually struggling with right now, and is actually I think fairly sort of smartly figuring out that you've got this immediate need; then you actually have to think sort of rather differently about the future for some of these areas that are so devastated.

Now, there are parts, of course, of the larger towns like Banda Aceh that simply need to get water restored and get electricity restored and get basic roads and bridges that have been destroyed restored.

So there, it's much simpler, of course. You know how to rebuild a bridge, and you simply have to go through serious sort of professional way of rebuilding it. So that could take place within the coming year, that basic reconstruction.

MARGARET WARNER:

What was the standard of living on that coastal… whole coastal area of Sumatra? If the aim were simply to restore the current standard of living, what are we talking about?

ANDREW STEER:

Well, the standard of living was, on the west coast of Sumatra, the west coast of Aceh, was, of course, very low. One has to remember, I mean, this was a war-torn area, and until two weeks ago, you know, access to these parts was not all that great.

And that, of course, is one of the reasons why it took much longer in Aceh to figure out just how disastrous the impacts were. So the income levels were very low. Livelihoods were often fairly basic.

Now, of course, what the government now wants to do, and we want to support them very strongly, is to help create a sort of a system of livelihoods that is better than what came before. We don't simply want to rebuild poverty.

We want to actually, you know, help Aceh get onto an altogether better growth trajectory. So we would never, ever want to say that this disaster, you know, has any hidden benefits; it's too ghastly for that.

But nonetheless, we do want to make sure that the kinds of rebuilding, the kinds of livelihoods, the kinds of credit schemes that we provide and the grant schemes that we provide and the small-scale infrastructure and the larger- scale infrastructure actually lead to an altogether deeper type of economic development.

And we do hope, of course, that in so doing, that the peace will come in a much fuller way to Aceh. And this is very, very much, of course, the government's intention, and just the day before yesterday, we met with a whole set of ministers here with the president to go through some of these ideas. But it's very early days.

MARGARET WARNER:

Andrew Steer of the World Bank, thank you for joining us.

ANDREW STEER:

Thank you very much.