A PDNA drawn in collaboration with international development agencies puts the toll of the cataclysmic deluge at USD 30.1 billion, and highlights urgency of action as more than 8 million Pakistanis remain displaced.
By Muhammad Ali
ISLAMABAD: The numbers are in – and they are steep as expected. The toll of this year’s cataclysmic monsoon flooding in Pakistan tallies to more than USD 30 billion, and the country needs more than USD 16 billion to build back, according to a Post Disaster Needs Assessment (PDNA) launched by the authorities here Friday.
A consortium of international donors including the World Bank, the Asian Development Bank (ADB), European Union (EU), and United Nations Development Program (UNDP) worked on the ground with the federal and provincial governments to draw up the assessment.
It was launched jointly by Minister for Climate Change Sherry Rehman, Minster for Planning Ahsan Iqbal, and Minister for Economic Affairs Ayaz Sadiq in the presence of representatives of the international donor community here at P Block on Friday.
According to the assessment, the country suffered accumulated damages and economic losses of USD 30.1 billion, including verified direct damages to the tune of USD 14.9 billion and economic losses of USD 15.2 billion.
The sectors to sustain the most significant damage were Housing at USD 5.6 billion; Agriculture and Livestock at USD 3.7 billion; and Transport and Communications at USD 3.3 billion.
Sindh is the worst affected province with close to 70 percent of total damages and losses, followed by Balochistan, Khyber-Pakhtunkhwa, and Punjab.
The country requires USD 16.2 billion for resilient reconstruction – in addition to the much-needed new investments beyond the affected assets, to adapt to climate change and build overall resilience to future climate shocks.
According to World Bank, the assessment calls for ‘building back better’, based on the principles of the poor first, transparency, inclusion, and climate resilience.
In addition to estimating damages, economic losses and recovery and reconstruction needs, the PDNA also assesses broader macroeconomic and human impacts and recommends principles along which to develop a comprehensive recovery and reconstruction framework.
The floods affected 33 million people and more than 1,730 lost their lives. Particularly hard hit were the poorest and most vulnerable districts.
The situation is still evolving, with floodwaters stagnant `in many areas, causing water-borne and vector-borne diseases to spread, and more than 8 million displaced people now in the grip of a health crisis.
The crisis thus risks having profound and lasting impacts on lives and livelihoods. Loss of household incomes, assets, rising food prices, and disease outbreaks are impacting the most vulnerable groups. Women have suffered notable losses of their livelihoods, particularly those associated with agriculture and livestock.
The PDNA Human Impact Assessment highlights that the national poverty rate may increase by 3.7 to 4.0 percentage points, potentially pushing between 8.4 and 9.1 million more people below the poverty line.
Multidimensional poverty can potentially increase by 5.9 percentage points, implying that an additional 1.9 million households are at risk of being pushed into non-monetary poverty.
Compounding the existing economic difficulties facing the country, the 2022 floods are expected to have a significant adverse impact on output, which will vary substantially by region and sector. Loss in gross domestic product (GDP) as a direct impact of the floods is projected to be around 2.2 percent of FY22 GDP.
The agriculture sector is projected to contract the most, at 0.9 percent of GDP. The damage and losses in agriculture will have spillover effects on the industry, external trade, and services sectors.
The government is providing immediate relief to the impacted communities and supporting the early recovery, while aiming to ensure macroeconomic stability and fiscal sustainability. Moving forward, as recovery and reconstruction spending rises, the loss in output could be mitigated.
Yet, significant international support will be needed to complement Pakistan’s own commitment to increase domestic revenue mobilisation and save scarce public resources, and to reduce the risk of exacerbating macroeconomic imbalances.
Although loss and damage estimates may increase as the situation is continuously evolving on the ground, the PDNA lays the groundwork for an agenda for recovery and reconstruction that is designed to build back a better future for the most affected people in Pakistan.
While the recovery will require massive efforts for the rehabilitation and reconstruction of damaged infrastructure, buildings, and livelihoods, it will also be an opportunity to strengthen institutions and governance structures.
The report puts forth recommendations for developing a comprehensive recovery framework. While the primary focus will be on the affected areas, such framework presents an opportunity to embed systemic resilience to natural hazards and climate change in Pakistan’s overall development planning.
This tragic disaster can be a turning point, where climate resilience and adaptation, increased domestic revenue mobilisation and better public spending, and public policies and investments better targeted to the most vulnerable populations; all figure at the core of policy making going forward.
In the short term, targeted mechanisms such as social assistance and emergency cash transfers, provision of emergency health services, and programs to restore shelter and restart local economic activities, particularly in agriculture, should be prioritised.
The assessment has identified five key principles on which to base the reconstruction and rehabilitation effort, the first of which is “building back better” to achieve participatory, transparent, inclusive, and green recovery for long-term resilience.
The other four principles are pro-poor, pro-vulnerable, and gender sensitive reconstruction, targeting the worst affected; strong coordination of government tiers and implementation by the lowest appropriate level; synergies between humanitarian effort and recovery; and a sustainable financing plan.
All stakeholders recognise that given Pakistan’s limited fiscal resources, significant international support and private investment will be essential for a comprehensive and resilient recovery.
The government on its part is committed to accelerating reforms to generate additional domestic fiscal resources and improve efficiency and targeting of public spending.
Beyond the immediate needs of floods reconstruction, these reforms will be important to generate fiscal space to invest more broadly into more climate-resilient infrastructure and adaptation to climate change while protecting the most vulnerable.
They will also be essential to building buffers to cushion any future shocks of this kind, while addressing macroeconomic imbalances.
This commitment of the government will also be key to mobilising further international support as well as to unlock private sector sources of financing – both of which will be absolutely critical to face the current climate change-induced shock.
The ADB, the EU, the UNDP and the World Bank are fully committed to working with the government and people of Pakistan during the ensuing recovery phase, and to increase the country’s climate resilience.
Both Rehman and Iqbal in their remarks noted widespread donor fatigue on account of a number of disasters unfolding in several parts of the world, but hoped that the international donors would be responsive to Pakistan’s dire needs.
Islamabad expects the participants of a donors’ conference expected to be held in a few weeks’ time in Paris or New York to lend a big hand to help Pakistan respond to the climate disasters unfolding in the country.
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