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ADB Responds to One of Indonesia's Most Devastating Natural Disasters
ADB Review [ August—October 2006 ]

By Jeffrey Hiday
Director General, Department of External Relations

BANTUL, INDONESIA

In a makeshift tent surrounded by dozens of other families, Ms. Parjiem recalled the moment the earth started rolling under her small home. "It was a shock," she said. "It was like a ship moving, and then everything collapsed."

REACHING OUT ADB President Haruhiko Kuroda met with people in Klaten and Bantul, two of the towns hit hardest by the disaster

Ms. Parjiem, whose aunt was killed in the 27 May earthquake, was one of more than 600,000 people who survived the earthquake but were left homeless. More than 5,500 were killed and at least 40,000 were injured.

She told ADB President Haruhiko Kuroda and other visitors from ADB that her most urgent need was to have her home rebuilt. An estimated 157,000 homes were destroyed in the disaster

Officials were stunned after they quantified the destruction caused. The overall damage and loss was estimated at rupiah (Rp)29 trillion (about $3.1 billion), making the May earthquake's scale of devastation similar to the 2001 Gujarat earthquake and the recent earthquake in Pakistan.

The disaster began just before 6 a.m. when the 6.3—magnitude quake struck about 15 miles south—southwest of Yogyakarta. ADB monitored the situation through its office in Jakarta and responded that same day with President Kuroda assuring the government of Indonesia of ADB's fullest support and cooperation in rebuilding.

Rajat M. Nag, Director General of ADB's Southeast Asia Department and Special Advisor to the President on Regional Cooperation, arrived in Jakarta a day after the earthquake to directly monitor the situation and determine how ADB could best assist Indonesia. He immediately met with Vice President Jusuf Kalla and Minister of Finance Sri Mulyani Indrawati.

On 30 May—3 days after the earthquake—ADB offered the government $10 million in immediate grant assistance and $50 million in soft loans, for a total of $60 million to help meet the rehabilitation needs of the affected areas.

"We will help Indonesia with whatever it takes and provide more resources to help the people rebuild their lives and livelihoods," Mr. Kuroda said after meeting with Indonesian President Susilo Bambang Yudhoyono in Yogyakarta.

During the meeting, President Yudhoyono thanked ADB for its quick response. "I think we should call ADB the bank for rapid deployment," said the Indonesian President.

After the meeting, Mr. Kuroda met with people in Klaten and Bantul, two of the towns hardest hit by the disaster. The residents described the destruction of their homes and the desperate situation they are left in now. In a nearby assistance center, Mr. Kuroda heard firsthand reports from students assisting with food distribution in the area, including one young man who was studying disaster management when he found himself in the middle of the real thing.

After personally seeing the devastation, Mr. Kuroda met with Vice President Kalla in Jakarta, while ADB's Jakarta office put together an immediate response team, comprising experts from various sectors to assist the government in its damage assessments.

The National Development Planning Agency (Bappenas) led the damage and loss assessment process, working closely with international organizations to coordinate priorities and divide responsibilities for assistance beyond the initial rescue and relief efforts. The team's report was released on 14 June.

The team found that housing and the local economy took much of the damage and loss. "Reconstruction will pose major challenges. The devastation was due to the shallow nature of the earthquake and poor quality construction in the affected areas. Most houses and buildings crumbled just like Lego blocks. Rebuilding has to focus squarely on quality," said Almud Weitz, who coordinated the damage and loss assessment process on behalf of ADB. Other team members included Ramesh Subramaniam, Lisa Kulp, Amanah Abdulkadir, Hari Purnomo, Farsidah Lubis, Farzana Ahmed, Indah Setyowati, James Darmawan Tunggono, Rehan Kausar, Robert Valkovic, Sutarum Wiryono, Ayun Sundari, and Siti Hasanah, with support from a team of ADB consultants.

"Immediate provision of small amounts of working capital and investment support to small—and medium—sized businesses affected by the disaster would go a long way toward containing future losses by helping people resume economic activity quickly," noted Ramesh Subramaniam, who coordinated the local economy aspect of the assessment process. "Unlike Aceh, the affected regions have been the centers of production for furniture, leather, ceramics, handicrafts, etc. with a vibrant sector. Thousands of enterprises affected in the disaster provided livelihood to millions of people."

As highlighted in the assessment report, though the number of casualties was fortunately lower than other comparable disasters, the damage and losses in Yogyakarta and Central Java have made this among the most costly natural disasters in Indonesia's history.

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