Nepal will need billions for flood recovery, minister says
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A drone view shows excavators and loaders in action as rescue workers repair a road leading to Gyirong Port.
PHOTO: REUTERS
- Nepal needs at least a few billion dollars for flood recovery after flash floods killed 469 people and destroyed infrastructure near the China border.
- The government is providing rescue, temporary shelter, and basic needs while international bodies and neighbouring countries offer aid.
- Nepal plans a major fundraising campaign and will consult the IMF on financial impacts, while ensuring safety amid risks of a second flood outburst.
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Nepal will need at least “a few billion dollars” to recover from the devastation caused by flash floods, prompting the US$45 billion (S$57 billion) economy to seek international funding for a massive reconstruction effort, according to Finance Minister Swarnim Wagle.
At least 469 people have been confirmed dead, a toll that is expected to rise in the coming days after flash floods sent an avalanche of rock, mud and water through a Nepalese valley near the border with China, wiping out bridges, roads and entire settlements.
More than 1,500 people are missing across Nepal and China, including visitors from India, Malaysia, Australia, Britain and the US.
“Cumulatively, I think the losses and damages, when they are finally quantified in a week or so, will amount to at least a few billion dollars,” Wagle told Haslinda Amin in an interview with Bloomberg Television.
“Preliminary estimates are quite worrying.”
The Finance Minister’s comments come after Nepal’s billionaire businessman Binod Chaudhary told Bloomberg News that he would not be surprised if rebuilding costs hit US$5 billion.
His Chaudhary Group spans 12 business verticals, from food and telecommunications to infrastructure and banking.
Nepal has long experience in dealing with natural disasters as its location in the Himalayas makes it vulnerable to earthquakes, landslides and flash floods.
A major earthquake in 2015 killed nearly 9,000 people and required a multi-year rebuilding effort requiring billion of dollars.
Wagle said the first phase of disaster management involving rescue and relief is in motion.
In the second phase, the government plans to put in place temporary shelter, providing basics including food, water, electricity and telecommunications, and possibly “cash for work initiatives”.
Multilateral institutions including World Bank and Asian Development Bank have committed funds for humanitarian needs, while neighbouring countries including India and China have provided supplies and financial assistance, the minister added.
“The World Bank has committed to siphon off at least 10 per cent of its undispersed allocation for other projects to these humanitarian needs. So that will amount to about US$160 million,” Wagle said.
“Similarly, the Asian Development Bank has committed US$5 million.”
New Delhi sent more than 10 tonnes of supplies including medicine, tents and solar lamps, followed by another 35 tonnes aboard an Indian Air Force heavy transport aircraft on Aug 27.
Wagle said Nepal would need a “different kind of fund-raising campaign” to rebuild damaged infrastructure and would consult the International Monetary Fund on the crisis’ impact on its external finances and potential support.
Nepal has an established bilateral mechanism for channelling aid from both the Indian and Chinese government, he said.
On warnings of a second outburst, the minister said the government is aware of the risks and people are being evacuated to safe grounds.
“There’s no one there,” he said. “Right now, the river basin that might be potentially be affected is really uninhabitable.” BLOOMBERG
