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Cash Often Fails to Match Aid Pledges

By Colum Lynch
Washington Post Staff Writer
Friday, January 14, 2005; Page A14

UNITED NATIONS -- In the three weeks since the Indian Ocean tsunami ripped up coastlines in Asia and Africa, the United Nations has credited more than 40 governments, the World Bank and the Asian Development Bank with unprecedented pledges of assistance valued at nearly $4 billion.

But a closer look at those commitments shows that hundreds of millions of dollars in those pledges had already been committed to development projects in the region. And as much as half of the offers are for interest-free loans, which the United Nations traditionally does not count as humanitarian aid.

After the December 2003 earthquake in Bam, Iran, where displaced survivors gathered outside tents, the United Nations requested about $33 million for relief efforts. It received $17.7 million. (Burhan Oizbilici -- AP)

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The tsunami relief effort illustrates how large pledges of aid have historically yielded far less cash than was promised for humanitarian relief and recovery efforts. And it underscores why the United Nations -- which asked for nearly $1 billion to fund its tsunami relief and reconstruction efforts over the next six months -- remains concerned that money may not be available to finance relief efforts, despite commitments made worldwide.

"I will not be surprised if we do not get all the money" pledged by governments, U.N. Secretary General Kofi Annan told reporters. "This is the history we live with."

Over the past two years, the United Nations has faced a shortfall of $3 billion in funding for relief operations and for rebuilding countries devastated by civil conflicts or natural disasters. In many cases, countries simply have not followed through on large public pledges of support.

U.N. officials and aid experts say that the challenge in accurately tallying aid pledges is that governments rarely explain whether their contributions consist of new money, loans or a repackaging of earlier announced development assistance meant to increase the apparent size of their donation.

"Governments have traditionally played political theater with aid pledges," said Shepard Forman, the director of New York University's Center on International Cooperation, who has studied aid disbursements. "There have been lots of smoke and mirrors in the amounts pledged by governments, and there is almost no way to track it."

Last February, U.N. members promised about $500 million to rebuild Liberia after years of civil war and misrule by exiled leader Charles Taylor. The United Nations asked for $141 million to cover its costs but received $65.3 million.

The December 2003 earthquake in Bam, Iran, initially elicited promises of $1.1 billion, Iranian President Mohammad Khatami noted last December. The United Nations appealed for about $33 million in January 2004 to run its recovery efforts but received $17.7 million, said Jan Egeland, the U.N. emergency relief coordinator.

"People are frustrated because they still live in temporary shelters, and they got promises that they would get housing," said Egeland, who said that 100,000 Bam residents still live in temporary shelters. "And they have not forgotten, and we have not forgotten, that there were pledges to give them permanent housing."

U.N. officials said their appeals for money after other natural disasters have fared even worse. A U.N. request for funds to respond to the devastation caused by a cycle of Caribbean storms, including Tropical Storm Jeanne in September, has been severely underfunded.

The United Nations asked for $37.4 million to help storm victims in Gonaives, Haiti, where more than 2,000 people died, but received $13.8 million. "In some situations, where we've made appeals, we've got as little as 14 percent of the amount we need to respond," Annan said recently at a pledging conference in Jakarta, Indonesia.

In response to the tsunami, the United States, which promised $350 million, and other governments have pledged generously, U.N. officials and aid experts said, competing in some cases to gain the distinction of being the world's largest donor.

Australia and Germany recently topped the list of aid donors with pledges of $810 million and $674 million, respectively. Half of Australia's pledge consists of interest-free loans to the Indonesian government spread out over five years. The bulk of Germany's pledge will be spent over the next three to five years.

At a meeting Tuesday in Geneva that focused on raising cash in the short term for U.N.-backed relief operations, representatives of more than 30 donor countries promised to earmark $756 million over the next six months, about three-quarters of the United Nations' total appeal. The pledges include near-term commitments of $250 million from Japan, $68 million from Germany, $40 million from Australia and $35 million from the United States. But U.N. officials said they have not received the money.

The World Bank recently pledged more than $250 million in credits and grants to help fund the recovery effort. But most of that pledge involves interest-free loans that have been shifted from existing development programs in the region, said Melissa Fossberg, a World Bank spokeswoman.

The Asian Development Bank, which pledged $675 million to rebuild roads, trains and other infrastructure projects in Indonesia, Sri Lanka and the Maldives, said that as much as $175 million of that amount consists of "reprogrammed" money from existing projects. The bank has not provided figures on how much of the additional money will be in the form of loans or grants.

U.N. officials, meanwhile, are left to thank nations for their generous assistance and promises, while at the same time drawing attention to the large gap between the pledges and the money currently available to fund relief operations. And the United Nations' Egeland has routinely lumped together loans, reprogrammed money and promises of cash grants in his daily tally of international commitments, which in some cases has created an impression that the pledges of new money are higher than they actually are.

"We are recording now pledges between $3 billion and $4 billion, which again shows that it is indeed the world coming together in a manner we've never, ever seen before," Egeland said after Australia and Germany announced their pledges. "We say thank you for the money."

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