Tsunami impact summary: Maldives

(The information provided here is preliminary and will be updated as more becomes available.)
Latest news (15 February 2005):

The Maldives will need approximately US$304 million to effectively implement a recovery and reconstruction strategy, according to a preliminary tsunami disaster needs assessment released today by the ADB, the United Nations Development Programme (UNDP), and the World Bank.

The assessment, prepared in close cooperation with the Government of the Maldives, sets out clear guiding principles for the reconstruction strategy. It estimates total damages in the Maldives to be approximately US$470 million, which is close to 62 percent of GDP. Most of the losses were concentrated in housing and tourism, with education, fishing, and transport also heavily affected. About US$120 million of external financing will be required in the short term over the next six months.

ADB has identified $15 million in uncommitted funds that can be used to assist with urgent needs. The World Bank will focus on education, health and housing, while ADB will focus on infrastructure (roads and communications), water supply, and power. A joint temporary liaison office in Maldives is also being considered, as only the United Nations Development Programme has a representative office in Maldives. ADB will also be working closely with other development partners, particularly the United Nations.



Some 83 people are reported dead and 25 are missing. About 100,000 people, or a third of the population of 300,000, have been severely affected, with nearly 12,000 displaced and 8,500 in temporary shelters.


The Maldives was the only country where the effects of the tsunami were felt across the country, rather than in certain parts or regions. Total damage estimates are about $470 million.

Of the 198 inhabited islands in the archipelago, 53 suffered severe damage, and 10% of the islands were totally destroyed. Schools, clinics and pharmacies have been destroyed in some 50 islands. According to the National Disaster Management Centre 44 schools, 30 health centers, and 60 island administrative facilities need to be reconstructed or rehabilitated. In total, around 4,000 buildings have been damaged. 79 islands have no safe drinking water and 15% of the water systems is destroyed or contaminated. 26 islands remain without electricity.

In the tourism sector, out of the 87 resorts, 19 were severely damaged and had to be closed down, while 14 others have suffered major partial damage.

Poverty profile:

Poverty in the country is related to remoteness of the islands from the center and a lack of services in the atolls. ADB's 2002 poverty partnership with Maldives aims to reduce absolute poverty from 43% in 1998 to 25% by 2015.

Economic impact:

Due to the narrow economic base and the country's very heavy dependence on tourism and fisheries, the Maldives economy is likely to be the most affected of all countries in the region and will face the highest per capita reconstruction cost.

The impact on the economy will be felt over the next 6 to 12 months. Most likely effects include:

Slowdown in real GDP growth to around 1% of GDP for 2005 (compared to a pre-tsunami forecast of 7.5%)

Rise in consumer prices of about 7%

Doubling of the current account deficit from an expected 12% of pre-tsunami GDP to 25% for 2005

Significant widening of the fiscal deficit to around 11% of GDP (assuming the Government implements planned fiscal measures)

About half of the country's houses were affected and absolute poverty of 43% in 1998 could increase to more than 50% as a result of the tsunami. Equally important, the likely increase in the poverty gap among the already poor is of serious concern and needs to be urgently addressed.

Tourism accounts for 33% of the gross domestic product (GDP) and 90% of foreign exchange. Fisheries accounts for 7% of GDP. Both sectors are likely to be affected at least in the short run. The negative publicity from the disaster could lead to a short-term decline in tourism. Economic recovery will therefore depend on the speed with which infrastructure can be rebuilt.

Besides tourism, the largest damages were sustained by the housing sector, with losses close to US$65 million. Approximately 1,700 houses were totally destroyed and another 3,000 were partially damaged.

Damage to the fisheries sector is mainly situated in loss of harbors / jetties and vessels. Around 100 fishing vessels were completely destroyed. Damage to the fish stocks and reefs would be rather limited.

Agricultural crops were swept away and most parts of the agricultural land are covered with salty mud leaving it unusable. New banana and mango trees could be planted and ready for harvesting in six months.

Businesses and enterprises have suffered badly and will continue to do so due to direct physical impact, the decline of tourist arrivals and by disruptions to the lives of the people involved.


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