Tsunami Social-Economic Impact
The initial assessments I've been reading last week put the tsunami's impact on the Asian economies as relatively small. Industrial and port facilities didn't suffer any major damage, and the Asian stock markets and currencies weathered the disaster fairly well. Big impacts are expected in the travel and tourism industries however, as coastal regions were badly hit and may take quite some time to recover. This disaster comes to the travel and tourism sector after it was recovering from the SARS scare, and after a ceasefire was agreed to in 2003 in the 20-year civil war in Sri Lanka. The economic powerhouses of Asia will be OK. They rely less on low skilled manufacturing and more on high tech industries. The third world countries that were hit by the tsunami will lose out more as the WTO rules relaxes the textile rules and allow other countries, such as China to enter the textile market. What follows is a brief summary of the countries that were the most impacted by the tsunami, and what the near term future bodes for them in dealing with the crisis.
The country hardest hit by the disaster has been Indonesia, with over 94,000 confirmed dead, and an estimated 400,000 dead or missing. Indonesia relies heavily on industry and services for most of its GDP. It's a country recovering from over 40 years of autocratic rule that destroyed its economy and left behind rampant corruption and a human rights quagmire. Its problems are many and its likely that this setback will slow its recovery as corruption is likely to take hold as foreign aid is distributed. The fear I have is that as the world rushes in to help in Indonesia, some Islamic terrorist faction will see this as an opportune time to kill a few foreigners. That would be the last thing Indonesia needs right now. Since the Gulf War, there has hardly been an opportunity for it to embrace the first world nations. If they play their cards right, this disaster could serve as an impetus to change for the better.
Second on the list of hardest hit countries has been Sri Lanka. As I've mentioned above, Sri Lanka enjoyed relative peace in 2004, after 20 years of civil war. Close to two-thirds of its GDP comes from the textile industry, soon to be heavily impacted by world trade rules governing textile exports. For the first time last year, the tourism industry started to pick up -- mostly due to native Sri Lankans returning home for a visit after the years of violence. To date, it still has about 362,000 citizens in refugee camps, mostly in India. Chances of those people returning home any time soon are pretty slim. If anything, the tsunami may serve to focus the population on other things than thinking about how they can kill each other. In one swoop, many people died. While their civil war claimed many more lives, it didn't do it with such ferocity.
India has lost about 10,000 people to the tsunami, with another 15,000 estimated dead, from its coastal areas to the south. India is a large country at both the social and economic extremes. Over half of its GDP now comes from services, followed by industry and agriculture. The disaster relief efforts will help India, and it will probably recover quickly. That's not saying a lot of great things about India -- it has dealt with a lot of conflicts and deaths in its recent past, and the value of life, especially of the poor, is quite low.
Thailand has had a lot of international attention during this disaster -- mostly because it was the destination for most of the foreign born tourists in Asia. There have been over 5,000 reported deaths and an estimated 11,000 more dead due to the disaster. Thailand's economy is split almost in half between services and industry, and only a small fraction of its GDP comes from the tourist trade. It is a great economic performer, with healthy investment, business policies and labour force. It is likely that Thailand will recover quickly from the disaster.
I'm not sure where the aid is going currently, but Thailand and India have been big in the news, followed by Sri Lanka and Indonesia. If the news is indicative of where the money and help is flowing to, a lot more people are going to die before things get better.
The country hardest hit by the disaster has been Indonesia, with over 94,000 confirmed dead, and an estimated 400,000 dead or missing. Indonesia relies heavily on industry and services for most of its GDP. It's a country recovering from over 40 years of autocratic rule that destroyed its economy and left behind rampant corruption and a human rights quagmire. Its problems are many and its likely that this setback will slow its recovery as corruption is likely to take hold as foreign aid is distributed. The fear I have is that as the world rushes in to help in Indonesia, some Islamic terrorist faction will see this as an opportune time to kill a few foreigners. That would be the last thing Indonesia needs right now. Since the Gulf War, there has hardly been an opportunity for it to embrace the first world nations. If they play their cards right, this disaster could serve as an impetus to change for the better.
Second on the list of hardest hit countries has been Sri Lanka. As I've mentioned above, Sri Lanka enjoyed relative peace in 2004, after 20 years of civil war. Close to two-thirds of its GDP comes from the textile industry, soon to be heavily impacted by world trade rules governing textile exports. For the first time last year, the tourism industry started to pick up -- mostly due to native Sri Lankans returning home for a visit after the years of violence. To date, it still has about 362,000 citizens in refugee camps, mostly in India. Chances of those people returning home any time soon are pretty slim. If anything, the tsunami may serve to focus the population on other things than thinking about how they can kill each other. In one swoop, many people died. While their civil war claimed many more lives, it didn't do it with such ferocity.
India has lost about 10,000 people to the tsunami, with another 15,000 estimated dead, from its coastal areas to the south. India is a large country at both the social and economic extremes. Over half of its GDP now comes from services, followed by industry and agriculture. The disaster relief efforts will help India, and it will probably recover quickly. That's not saying a lot of great things about India -- it has dealt with a lot of conflicts and deaths in its recent past, and the value of life, especially of the poor, is quite low.
Thailand has had a lot of international attention during this disaster -- mostly because it was the destination for most of the foreign born tourists in Asia. There have been over 5,000 reported deaths and an estimated 11,000 more dead due to the disaster. Thailand's economy is split almost in half between services and industry, and only a small fraction of its GDP comes from the tourist trade. It is a great economic performer, with healthy investment, business policies and labour force. It is likely that Thailand will recover quickly from the disaster.
I'm not sure where the aid is going currently, but Thailand and India have been big in the news, followed by Sri Lanka and Indonesia. If the news is indicative of where the money and help is flowing to, a lot more people are going to die before things get better.
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