Fewer Acehnese living in poverty: WB

from The Jakarta Post

The Jakarta Post, Jakarta

Poverty in tsunami-struck Aceh has fallen below the pre-disaster level, a new World Bank report shows, due to both peace and the large reconstruction effort.

The Aceh Poverty Assessment 2008 report shows poverty in Aceh increased slightly in the aftermath of the tsunami, from 28.4 percent in 2004 to 32.6 percent in 2005.

However, the poverty rate fell in 2006 to 26.5 percent, below the pre-tsunami level, suggesting the rise in tsunami-related poverty was short-lived and reconstruction activities most probably facilitated this decline.

Despite the improvement, the report said, poverty in Aceh remains significantly higher than in the rest of Indonesia.

Lead author Enrique Blanco Armas concluded in the report the short increase in poverty levels in 2005 was relatively small given the extent of damage caused by the tsunami.

The 2004 tsunami devastated Aceh's coast, with 130,000 confirmed dead and 37,000 still missing. An additional 500,000 people were displaced by the disaster.

Damage and losses were estimated at US$4.8 billion and the production sector alone suffered damage estimated at $1.2 billion, with over 100,000 small businesses destroyed and more than 60,000 farmers at least temporarily displaced.

"Poverty was higher in both tsunami- and conflict-affected areas in the immediate aftermath of the tsunami. By 2006, poverty in tsunami and non-tsunami affected areas appeared to equalize and the impact of the conflict on poverty declined in 2006," Armas said.

The report further showed poverty in Aceh was predominantly a rural phenomenon, with over 30 percent of rural households living below the poverty line and less than 15 percent of poor households in urban areas.

Other characteristics associated with higher poverty levels were larger household sizes, lower education levels, female-headed households and households that predominantly worked in agriculture.

The relationship between the above characteristics and poverty, the report said, remained relatively stable over the tsunami period, suggesting underlying determinants of poverty were unchanged despite the rapid socio-economic and political changes.

In a statement received by The Jakarta Post on Monday, Kuntoro Mangkusubroto, director of the Executing Agency for Rehabilitation and Reconstruction of Aceh and Nias (BRR), said the positive impact of the post-tsunami reconstruction effort was not going to be sustainable for the Acehnese.

"The current growth trend, primarily the result of the large reconstruction effort, is not sustainable. Agriculture and manufacturing continue to stagnate.

"The provincial and regional governments, respectively, need to develop the necessary regulations that encourage the development of the private sector, particularly in agriculture and downstream-related industries," Kuntoro said.

Abdul Rahman Luis, head of Aceh Regional Body of Planning and Development, said improving the productivity of the agricultural and fisheries sectors as well as other sectors linked to poverty alleviation was key to alleviating poverty in Aceh.

"It is important that the current focus on reconstruction of tsunami-affected areas be broadened to focus on the poorest and most remote areas that are not necessarily those devastated by the tsunami," Abdul said.