IDPs, flood victims: International donors pitch in with $690m pledges

Islamabad expected $2b for rehabilitation of people displaced by floods and Operation Zerb-e-Azb.

ISLAMABAD:

Pakistan on Tuesday got a mixed response to its plea for $2 billion for the rehabilitation of hundreds of thousands of people displaced by the recent monsoon-induced floods and Operation Zerb-e-Azb, as majority of international donors announced to divert their existing financing instead of committing fresh funds.

At the end of the second donors’ meeting, $690 million financial assistance was offered to Pakistan but a big chunk of this was extended by diverting funds the donors and international lending agencies had already promised but remained unutilised, according to finance ministry officials.

The available assistance will be spent over a period of three years through the World Bank-administrated Multi-Donor Trust Fund (MDTF), bilateral arrangement, mainly by the United States and multilateral channel of the WB and the Asian Development Bank (ADB), according to the officials who attended the meeting.

The donors had apprehensions about the misuse of their money, thus sought all spending through other than government channels.

The meeting was held at the Prime Minister’s Office and attended by all the leading bilateral and multilateral development partners of Pakistan. The meeting was convened to make an appeal for funds for Temporarily Displaced Persons (TDPs) from North Wazirstan and other tribal areas and floods in Punjab, Azad Jammu & Kashmir and Gilgit-Baltistan.



The military gave a presentation on Operation Zarb-e-Azb and its financial implications. Officials said the military lowered its earlier estimates of $1.5 billion requirements for rehabilitation of the displaced families to $1.1 billion. The National Disaster Management Authority (NDMA) put the floods-related estimates at around $900 million, according to European diplomats.

Only for the recovery, the Pakistani authorities put the cost at $1.4 billion, according to the ministry of finance. The cost of operation-related recovery was estimated at $750 million and the rest of the cost of the flood-related recovery activities.

According to a brief statement of the ministry of finance, around $700 million were pledged by the Department for International Development (DFID) of the UK, WB, ADB, European Union, Islamic Development Bank (DFID), Japan, Italy and others.

However, the officials revealed that the IDB, ADB, Japan and Italy would reprioritise their already committed funds, so there will not be additional funds flowing to Pakistan. These funds remained unutilised due to various reasons. The $180 million funds committed by the ADB under 2010-12 floods reconstruction projects remained unutilised. These funds would now be given for the TDPs, according to the officials.

In addition to the existing $45 million grant, the EU will provide additional $22 million for TDPs, said EU Ambassador to Pakistan Lars Gunner Wigemark. An amount of $18 million would be utilised for FATA community development, he added.

The Italian government would divert funds it committed years back under Debt Swap arrangements. The DFID would immediately give an additional $30 million through WB-administrated channel.

Presiding over the conference, Finance Minister Ishaq Dar assured the donors that all activities would be undertaken under the mechanisms already established to help people in the calamity-hit areas. He said efforts would be made to bring visible improvements.

The minister said the war on terror had taken a heavy toll on Pakistan’s resources and the recurrent floods only added to its economic woes. “Pakistan expected the international community to extend a helping hand in this hour of need,” he added.

The WB assured the government that it would improve multi-donor trust fund to address Pakistan’s concerns about slow disbursements. The WB is also charging 7.5% of the total commitments as administrative cost, which is too high.

ADB Country Director to Pakistan Werner Liepach said his organisation would support priority rehabilitation and reconstruction needs and enhance resilience to future disasters. He proposed establishment of a ‘Pakistan fund for disaster management’ with the collaboration of the government and the donors.


Published in The Express Tribune, November 12^th, 2014.