Reconstruction in Haiti to cost up to $14 billion

A new study by the Inter-American Development Bank estimates that the cost of reconstruction in Haiti could be as high as $8 to $14 billion. Haiti’s relatively small population, weak economy, and the proximity of the earthquake to the heart of Haiti’s economy in Port-Au-Prince, make the January 12th earthquake the most destructive natural disaster in modern history. By comparison, the tsunami that devastated Southeast Asia in 2004 cost approximately $5 billion with damages being dispersed over a much greater area.

The United States and Canada are leading the relief effort in Haiti. Canada has announced that it will build a semi-permanent base of operations for the Haitian government outfitted with computer hardware, communications systems, furniture, water supply and air-conditioning. The Haitian government has been operating out of a nearby police station since the earthquake destroyed the Presidential Palace.

While millions of dollars are being funneled into Haiti relief, concerns abound over the proper management of these funds. Haitian President Rene Preval is considering creating a single fund for all of Haiti’s relief money to be managed in conjunction with donors. Leonel Fernandez, president of the Dominican Republic, believes that this fund could raise as much at $10 billion in the first five years, even though the total reconstruction process is likely to take at least a decade.

Logistical concerns are also making effective use of funds a difficult task. The UN estimates that only about 272,000 people have been reached with shelter materials so far. The urgency of the situation is only intensifying as Haitians await the annual rainy season around May. The rains are expected to cause still more damage to weakened structures by collapsing rooftops, and force thousands of refugees to relocate.

Looking to the future, President Preval declared that “We have to take this opportunity, not to reconstruct Haiti, but to rethink and remodel it.”

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