Aceh five years after the tsunami: where have all the customers gone?


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It surprised me a little bit when I was driving my family along the west coast of Aceh a couple of weeks ago. Not too far from Banda Aceh, the capital city of Aceh’s province, a 15 meters wide- fresh-paved asphalt road built by the US absolutely has framed Aceh into another window of opportunity. This strategic road will connect Banda Aceh and some other districts in the west coast, which was washed away by the tsunami. Before the disaster, it was narrow and poorly maintained. This reminded me of the slogan that Mr. Clinton, former US president and also the UN special envoy for the tsunami recovery often advocated: to build back better!

The dramatic news that tv stations kept airing for weeks after Christmas five years ago prompted an unprecedented response from across the world. Governments, individuals, and aid agencies pledged at least $7billion for Indonesia, of which an astonishing $6,5 billion was allocated. According to BKRA (Reconstruction Continuation Agency for Aceh) by mid 2009, more than 140,00 houses, 3,700 km of road, 36 airports and seaports, 1,600 schools and more than 900 government buildings had been built, and 70,000 hectares of farmland were restored by various agencies, apart from the intangible assets gained from many technical assistance and capacity building programs.
These great accomplishments were not without daunting challenges. Aceh was a conflict area, plagued for more than 30 years by an armed conflict with the central government over its rich natural resources. More than 17,000 people had been killed by this conflict until August 2005. Lack of trust in the capacity of local government on the ground was spotted as one of the biggest barriers to reconstruction.  The central government, through the Rehabilitation and Reconstruction Agency, decided to coordinate this effort.  Aceh hosted around 2,200 projects across all sectors implemented by more than 400 agencies. A strong government’s grip on the driver seat was one of the influential contributors to the success of Aceh reconstruction, which is now known as the largest reconstruction effort in the developing world (see some details on a paper I co-authored, .pdf).

I pulled over to one of my favorite coffee shops along the road. It was prominent during the reconstruction’s peak period. It serves local grilled fish along with fresh vegetables, one of the best I should say. Nothing wrong with the taste and services, but not more than 5 people were there, enjoying the sunset. A year ago, you would´ve found the chef and waitress busy taking orders during the weekend. It won’t surprise me too much if this coffee shop is gone in the next 3 months (some have already closed actually). Where have the customers gone, what will the waitress do, how will the economy look like ? As the reconstruction is nearing an end, the demand perhaps is vanishing. Fueled by the reconstruction, the economy had grown for the last couple of years but seems it has failed to maintain its pace. It is true that Aceh has been rebuilt even better than it was before, and yet, perhaps not so much in terms of being able to sustain the economy. Let me share details on this in another post.


Harry Masyrafah

Research Analyst at the World Bank Office in Aceh

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Rinsan Tobing
December 22, 2009

The influx of many NGOs, International organizations and UN bodies after the hit to assist was directly helping to move the economy of Aceh looking at the amount of money spent for daily need, house rent, boarding room rent, office, rent, car rent, motorbike rent and as well the local workers hiring.

During the reconstruction time, as part of the encouragement of the government in process of build back better to source the resources from local capacity, NGos, UN and International Agencies hired the local staff. This is also that the fact the process of reconstruction needed a lot of workers.

This local workfroce were relatively hired with high payment. Compared to the national salary rate for equivalent level, the salary was relatively high. The salary was still accompanied by various allowances such as transport allowance, housing allowances, health allowance and certain percantage for working in post disaster/emergency areas.

In those five years, this local workfoce with high salary got used to a better, more convenient life and high salary. The mentality also change. They considered that the salary the got at the time became the standard for their capacity. This perception was totally wrong. Yes, it was standard salary for emergency situation but not in the peace time.

But again mentality has been shaped and situation has changed from the reconstruction time with massive activities to the continuation of reconstruction with less actitivies marked by the fact that there have been many NGO, International Agencies and UN bodies leaving Aceh for program was completed. There are then thousands or hundred thousands of local workers with self-perceivedly high-paid capacity jobless. A higly-paid job will be a scarce commodity now in Aceh and the workers with the existing capacity will reluctantly to accept an offer from local companies with much-much lower salary. Competing with other workers which are national and international is something that they are find difficult to win. Actually, some of them are still hired by the similar NGO or another NGo for the work in other areas. At least I could witnes this when I visited Padang after the hit of 7.3-earthquake in 30 September 2009. There are only few, but many many more now jobless and trying to change the mentality to accept the less paid work in Aceh.

This inflation of local once-paid high workers with capcaity less than national workers is also something that is left after the five years. Then a question is raised, where to go from here.