SBY TAKES STOCK: ACEH RECONSTRUCTION AGENCY (BRR) ENDS

UNCLAS SECTION 01 OF 02 JAKARTA 000701

SENSITIVE
SIPDIS

DEPARTMENT FOR EAP/MTS, INR/EAP
DEPARTMENT PLEASE PASS AID
USAID FOR ANE/EAA

E.O. 12958: N/A
TAGS: PGOV PREL SOCI ID
SUBJECT: SBY TAKES STOCK: ACEH RECONSTRUCTION AGENCY (BRR) ENDS
OPERATIONS

JAKARTA 00000701 001.2 OF 002



1. (SBU) Summary. The Aceh and Nias Rehabilitation and
Reconstruction Agency (BRR),created in the wake of the 2004 Indian
Ocean Tsunami, formally ended its 4-year mandate in a ceremony held
in Banda Aceh on April 15. Over the course of its existence BRR
built or rebuilt nearly 140,000 homes, 3,700 kilometers of road, and
some 1,700 schools. The closure represents the end of formal
Jakarta-directed reconstruction work, although budget allocations of
remaining reconstruction money to the Aceh provincial government and
ministries in Jakarta will ensure that work on unfinished projects
continues. BRR was a new way of doing business for the GOI and
represented a strong commitment by the Yudhoyno administration to
efficiency and results. The Government is considering using elements
of the model in addressing other pressing development priorities.
End Summary.



Most of the Job Done and Done Well
--------------


2. (U) BRR's closing was marked with a series of events in Aceh and
Jakarta during the week of April 13. A small flag-lowering ceremony
attended by the Director of the USAID Aceh Reconstruction and
Rehabilitation Office was held at the BRR Office on Wednesday, April
15 in Banda Aceh. The ceremony in Aceh preceded official events in
Jakarta which included donors, the national government, and Aceh
Governor Irwandi Yusuf. Overall impressions of BRR's work within
Aceh remain positive, while criticisms over certain shortcomings are
confined to irregularities and deficiencies that are well within the
range expected given the massive reconstruction effort.


3. (U) BRR reports that it allocated $6.7 billion dollars of the
$7.2 billion pledged by individuals and governments after the 2004
Indian Ocean Tsunami that killed over 130,000 Acehnese. BRR data
also shows that construction during the past four years included
over 140,000 houses, 3,700 kilometers of roads, 1,700 schools 1,100
medical facilities, 1000 governmental buildings, 363 bridges, 23
seaports, and 13 airports and airstrips. BRR also rehabilitated
101,000 hectares of farmland. Beyond reconstruction and
rehabilitation BRR assisted 195,000 small and medium-sized
enterprises and trained 155,000 workers and nearly 44,000 teachers
throughout Aceh.

Unfinished Business
--------------


4. (U) Despite the scale of the reconstruction efforts already
completed, there remain a number of outstanding projects as of the
official closing of BRR. During an April 16 interview BRR Head
Kuntoro Mangkusubroto listed housing complexes for tsunami victims
in several locations and bridges still under construction in Aceh
Jaya and Aceh Tamiang districts. Kuntoro estimated the total funds
being transferred to provincial and district administrations for
completion of the projects at 3.3 trillion Rupiah. (Over $308
million at current exchange rates) Questions regarding the ability
of the local government to administer the remaining relief funds
have already been raised. Governor Irwandi rejects the notion that
the provincial government is not up to the task of administering the
funds. He also announced on April 15 to media that the Aceh
Provincial Government will use a special 2009 budget of 1.3 trillion
Rupiah (over $120 million) to finish any projects the BRR did not
complete.

SBY Pleased with BRR Performance
--------------


5. (U) On April 17, Indonesian President Susilo Bambang Yudhoyono
hosted a closure ceremony at the Palace to recognize the
achievements of BRR and to bask in the afterglow of the same. The
ceremony was attended by the Vice President, the Governors of Aceh
and North Sumatra as well as other GOI figures, representatives from
NGOs, and the donor community. BRR head Kuntoro used the occasion to
preview a presentation he will be giving at the United Nations in
New York later this month. He and the GOI are casting their
presentation as a statement of "emergency best practices" which have
relevance for the rest of the world. They showed a slick video and
distributed eye-catching materials capturing the impressive physical

JAKARTA 00000701 002.2 OF 002


accomplishments of the response.

The President on Lessons Learned
--------------


6. (U) The President outlined 11 lessons he had learned from the BRR
experience. Most of them sounded like a primer in "Management 101"
but they also reflected a break with many of the traditional
approaches which characterize the business of government in
Indonesia. He believes that the model of the BRR was clearly a
different way of doing business. In brief, his lessons were divided
between the "Emergency Phase" of the response (do first things
first, focus on those things that had the most life saving
potential, practice crisis action management, welcome all
assistance, coordinate the response) and the "Recovery Phase" (set
clear goals and have a simple, workable master plan that is time-
and resource-bound, use and empower good organizations, keep
operations clean, get strong leadership). He then added a last
lesson - given Indonesia's disaster profile, the risks of climate
change, etc. - Indonesia must put in place an attitude of constant
"national disaster readiness."

Linking the Tsunami with Peace
--------------


7. (U) The President repeatedly drew attention to the linkages
between the disaster response and the peace process in Aceh. Both
were key missions for his administration. When discussing his
lesson of accepting all humanitarian assistance, he talked frankly
about concerns within the GOI about the presence of outsiders in
Aceh. He recognized the contributions of his Vice President in
realizing the 2005 Helsinki MoU and peace agreement. As contributing
factors he listed the humanitarian activities of the TNI, support
from across the political spectrum for a negotiated solution, the
desire of the people, and international support. Regarding
international support, he added the clarification that it was
support which worked with Indonesian "ownership." Finally, he noted
that the commitment of top leadership to the process and willingness
to take risks were critical success factors.

Where to go from Here
--------------


8. (SBU) Comment. The President and his colleagues were clearly
basking in the glow of this success. When the BRR was established
there were many naysayers who predicted that the GOI would not be
capable of managing a disaster response of this magnitude in a
timely, effective and "clean" way. The GOI demonstrated that, with
the right kind of management and incentives, they were up to the
job. The success of the effort certainly ruffled other elements of
the GOI. Nonetheless, that it was a model that delivered results has
not been lost to a broader audience. During his comments, for
example, the President referred to the interest of the Governor of
Papua in adopting aspects of the BRR model for his province. On the
margins of the reception insiders were speculating about Kuntoro's
future in a new cabinet or within the United Nations.

HUME