A tropical depression (TD06F) with associated heavy rainfall affected the Western Division of Fiji from 23-27 January 2012 causing landslides and widespread flooding of low lying areas. Nearly 25,000 people were affected with over 4,000 people being forced from their homes and floods and landslides claiming eight lives in total. Water and electricity supplies were disrupted and infrastructure and crops (in particular, sugarcane) suffered extensive damage.
A state of natural disaster was declared for areas of the Western Division on 25 January 2012 effective for a period of 15 days. The National Emergency Operations Centre (NEOC) coordinated and closely monitored the recovery measures taken by the relevant government agencies and NGOs. The Fiji Red Cross assisted affected people in over 70 evacuation centers throughout Fiji. Assessment reports were collated from Divisional and District Emergency Operation Centers and initial damage and needs assessments were undertaken for agriculture, health, water and sanitation and infrastructure.
Relief efforts have focused on priority areas such as the provision of shelter, education, and food supplies as well as restoring critical water and health services. However, based on preliminary estimation of damages more resources are required in order to meet all relief needs. In recognition of this, the Government of Fiji requested immediate ADB assistance under the Asia Pacific Disaster Response Fund (APDRF) on 27 January 2012.
|Project Rationale and Linkage to Country/Regional Strategy
Fiji's economy grew by 1.5% in 2011 following two years of contraction. Economic growth over the past five years has been anemic at best, averaging -1.1%. ADB expects economic growth to return to long-run average levels of around 0.7% in 2012, although the impacts of the flooding, particularly on the sugar sector, will certainly necessitate a downward revision. A budget deficit of 1.9% of GDP is projected for 2012. Pressure on the national budget as a result of relief and rehabilitation costs could add another 1%-1.5% of GDP to the deficit and would undermine the government's fiscal consolidation efforts. Preliminary estimates provided by the Ministry of Finance indicate losses to the private sector of up to $115 million including loss of stocks, businesses, properties, farms and plantations and losses to key infrastructure (roads, bridges, etc.) amounting to approximately $17.3 million subject to further updates.
Fiji's public debt levels are already high, that is, around 54% of GDP (and well above the government's target of 40%). Although there is some fiscal space to respond to the impacts of the flooding, fiscal expansion so early in the budget year would leave less room to deploy fiscal stimulus should the need arise later. Given the range of risks to economic prospects, including weakening global demand, undertaking such a measure would not be considered prudent.
The damage caused by the disaster is of a scale beyond the capacity of the Government and its own agencies to meet the immediate expenses necessary to restore life-saving services to the affected populations. The flooding follows a previous flood disaster in January 2009 which likewise had its main impact in the Western Division but also other parts of Fiji, affecting 140,000 people and causing damage estimated at $180 million (approximately 5% of GDP). A subsequent request by the Fiji Government for ADB support resulted in an Emergency Assistance Loan (EAL) of $17.56 million under the provisions of the Disaster Emergency Assistance Policy (DOC.R71-04). Projects funded under this EAL are currently being implemented.