Introduction

Overview
Coordination of rehabilitation and reconstruction
Conflict and security of aid workers

International commitments
Canada’s priorities
Government of Indonesia’s reconstruction strategy
CIDA’s reconstruction strategy

A Role for Canadian Partners

Matching funds
Other possibilities for projects

The Government of Indonesia faces several challenges as it begins to plan Aceh’s rehabilitation and reconstruction:

• the sheer magnitude of the destruction;
• the loss of up to 80 percent of local government personnel;
• the need to coordinate a large number of foreign organizations; and
• the need to also support the peace process, following the Peace Agreement signed in August 2005.

After the tsunami, Acehnese separatist forces and the Indonesian army informally ceased firing, but the respite was only brief, and shootings and violent encounters resumed early in 2005. In August 2005 however, a peace agreement was signed between the GAM (Free Aceh Movement) separatist movement and the Government of Indonesia. Since then, long-term peace prospects have increased, as several steps have been taken, including the start of the international Aceh Monitoring Mission (AMM) in September 2005, and the decommissioning of weapons and related redeployment of troops and police forces of which a third phase was held mid-November 2005.
As a result, as of November 2005, UN security phase for the entire Aceh province has been downgraded from Phase 3 to Phase 4. While the situation continues to be improving, the risk of attacks still needs to be carefully monitored. The Office for the Coordination of Humanitarian Affairs and the Government of Indonesia are asking relief workers in Aceh to register with them to help ensure their personal security, but GOI is starting to allow agencies to work in Central Aceh.

International commitments

The international community has pledged more than US$6 billion for relief and rehabilitation work related to the tsunami, of which Canada is contributing $425 million. Canada has designated $160 million for reconstruction efforts for all affected countries over four years.

Canada’s priorities

• Short-term: relief for the people of Aceh and North Sumatra
• Medium- to long-term: meaningful reconstruction assistance that is coordinated, demand-driven and harmonized, harnessing Canadian capacities

• improved governance at the local level;
• growth of small- and medium-sized businesses; and
• equitable access to, and sustainable use of, natural resources.

Government of Indonesia’s reconstruction strategy Five basic reconstruction goals have been identified: restoring people's lives (water, shelter, income, infrastructure services); restoring the economy (jobs, markets, banks); rebuilding communities (social stability, local solidarity); restoring local governance; and re-establishing the provinces as politically stable and economically vibrant.

CIDA’s reconstruction strategy

Ultimately, CIDA's reconstruction program in Aceh and North Sumatra will help survivors rebuild their communities and re-establish their livelihoods. In line with the Government of Indonesia’s reconstruction strategy, CIDA will focus on:

• rebuilding and strengthening the system of local governance:
  • replacing the lost capacity of local governments and strengthening them to deliver pro-poor public services; and
  • rebuilding the capacity of local civil society organizations, and supporting community empowerment.

• restoring livelihoods (enterprise assistance and restoration of natural resource base):
  • restoring sustainable livelihoods, including in the agriculture, forestry and fisheries sectors (i.e., capital investment, micro-credit, market development); and
  • rehabilitating the environment that supports restoration of sustainable livelihoods.

In addition, the activities of several large Matching Fund partners will complement this strategy by supporting—with CIDA matching funds—the re-building of permanent houses and related community infrastructure. This will be done in ways that ensure meaningful community participation in areas such as land planning, site selection and the selection of type and model of houses.

Peacebuilding: CIDA will use peace and conflict impact assessment to mitigate harmful effects and to identify opportunities to support reconciliation and peace processes. There are now more opportunities for such support following the August 2005 Peace MOU between GAM and Government of Indonesia.

Coordination: CIDA will work with Foreign Affairs Canada’s Human Security Program to identify potential opportunities. At the local level, CIDA is active in coordination mechanisms such as the Multi-Donor Trust Fund for Aceh and Nias, and the Government of Indonesia (BRR) led coordination efforts such as the Coordination Forum for Aceh and Nias (CFAN), and the regular sectoral working groups in Aceh itself.

Gender equality: CIDA will ensure that women and girls are represented in decision-making, planning, design, implementation, and monitoring of reconstruction.

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Implementation Strategy

CIDA has established a presence in Banda Aceh and plans to build on its existing program. As an immediate measure, it will amend existing projects as appropriate in such areas as good governance and decentralization, environment, and small- and medium-size enterprises, to encompass Aceh and North Sumatra.
CIDA can also leverage existing successful projects to design new initiatives, such as coordination of reconstruction activities, NGO capacity building, or community development through religious and cultural leaders.
CIDA also expects to partner with major international financial institutions or organizations such as the United Nations Development Programme, World Bank, and Asia Development Bank on joint initiatives.
The program is taking place over four years (2005/06 to 2008/09). Given that the Government of Indonesia’s draft strategy goes beyond four years for reconstruction, CIDA plans to integrate long-term reconstruction efforts into its country development programming framework for Indonesia, starting in 2009/10.

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A Role for Canadian Partners

CIDA will seek opportunities and entry points to make the best use of Canadian expertise. It will work with partners to ensure that communications respond to the needs and expectations of Canadians, providing a fair and balanced view of the situation.

CIDA’s Asia Branch will manage the overall tsunami response, providing potential partners with a single point of contact. International Trade Canada has the lead role in communicating opportunities for involvement in reconstruction projects funded by international financial institutions and United Nations agencies to the private sector.

Matching funds

NGOs will be able to use matching funds for rehabilitation and reconstruction. These projects must be consistent with the Indonesian government’s plans, priorities, and coordination requirements. Precise amounts of available funds, as well as criteria, have been previously announced.

Other possibilities for projects

CIDA’s reconstruction program in Aceh and North Sumatra will provide opportunities to incorporate the Canada Corps. In addition, CIDA, the Federation of Canadian Municipalities, and provincial representatives have begun to identify possible projects for further development.