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Cablegate: Burma: Post Nargis Bogale - Down but Not Out

VZCZCXRO9864
RR RUEHCHI RUEHDT RUEHHM RUEHNH RUEHTRO
DE RUEHGO #0540/01 1910827
ZNR UUUUU ZZH
R 090827Z JUL 08
FM AMEMBASSY RANGOON
TO RUEHC/SECSTATE WASHDC 7886
RUCNASE/ASEAN MEMBER COLLECTIVE
RUEHGG/UN SECURITY COUNCIL COLLECTIVE
RUEHBJ/AMEMBASSY BEIJING 1928
RUEHBY/AMEMBASSY CANBERRA 1336
RUEHKA/AMEMBASSY DHAKA 4918
RUEHNE/AMEMBASSY NEW DELHI 4865
RUEHUL/AMEMBASSY SEOUL 8424
RUEHKO/AMEMBASSY TOKYO 5986
RUEHCN/AMCONSUL CHENGDU 1512
RUEHCHI/AMCONSUL CHIANG MAI 1696
RUEHCI/AMCONSUL KOLKATA 0363
RUEATRS/DEPT OF TREASURY WASHDC
RHHMUNA/CDR USPACOM HONOLULU HI
RUEHGV/USMISSION GENEVA 3888
RHEHNSC/NSC WASHDC
RUCNDT/USMISSION USUN NEW YORK 1842
RUEKJCS/SECDEF WASHDC
RUEHBS/USEU BRUSSELS
RUEKJCS/JOINT STAFF WASHDC

UNCLAS SECTION 01 OF 03 RANGOON 000540

SENSITIVE
SIPDIS

DEPARTMENT FOR EAP, PRM, DRL
STATE ALSO PASS TO USAID
AID/W FOR DCHA/FFP AND DCHA/OTI
AID/W FOR DCHA/OFDA KLUU, ACONVERY, RTHAYER
BANGKOK FOR DCHA/OFDA TROGERS
KATHMANDU FOR DCHA/OFDA SMCINTYRE AND MROGERS
USMISSION GENEVA FOR NKYLOH
USMISSION USUN FOR FSHANKS

E.O. 12958: N/A
TAGS: BM EAID SENV KSCA TBIO VM EAGR PREF
SUBJECT: BURMA: POST NARGIS BOGALE - DOWN BUT NOT OUT

REF: RANGOON 532 AND PREVIOUS

RANGOON 00000540 001.4 OF 003


SUMMARY
-------

1. (SBU) On a recent three-day trip to the delta, rural cyclone
victims in Bogale township told us that they most needed cash to
help re-establish their livelihoods. All three of the villages we
visited suffered extensive damage as a result of Nargis, but had
begun rebuilding on their own. The villagers said that most of the
goods they needed were available on the market, it was capital that
they lacked. Local residents reported that the regime had not
adequately met their needs since the cyclone. Additionally, while
they appreciated the aid community's efforts to send them supplies,
storm victims informed us that some of the items they received were
not useful. Victims we spoke with believe they are in a better
position to procure what they need to rebuild their communities.
Prior to Nargis, many of the villagers we met had taken out, and
repaid, micro-credit loans from the NGO Pact, and nearly all
expressed a desire to do so again. Pact officials told us they were
prepared to make more loans, but needed to be recapitalized in order
to do so.

2. (SBU) A USAID/OFDA officer, poloff and local staff member from
Embassy Rangoon traveled to Bogale township from July 1 to 3. The
team visited Bogale town and the villages of Kapanan, Kyipinsu, and
Ywarthit.

DOWN BUT NOT OUT
----------------

3. (SBU) Our team visited three villages in Bogale township that
fell in the path of Cyclone Nargis. In all, we met with over 200
villagers whose communities had suffered extensive damage as a
result of the cyclone. Many told us they had lost family members,
and nearly all reported the storm either destroyed or significantly
damaged their homes. The residents we met also complained that
neither the regime nor the international aid community had
adequately provided for their needs since the cyclone. Despite
this, the communities we visited had begun to rebuild on their own,
and could articulate exactly what they needed to finish the job.

4. (SBU) When asked, cyclone victims told us that they most needed
cash to help re-establish their livelihoods. Some were farmers,
some fishermen, and others owned small businesses. Most did not own
their own land, but worked for those who did. Each reported a
different use for the cash they needed. Farmers would buy seeds and
farm equipment, fishermen needed nets and boats, and retailers
wanted to repair and restock their stores. But no matter what the
specific use, the villagers pointed out that nearly all of what they
needed was available on the market, provided they had the cash to
purchase it. During our three-day visit, we observed active
wholesale and retail markets selling a wide-variety of goods in
Bogale. The NGO Pact and others active in the delta noted that
merchants, businessmen, and entrepreneurs were delivering and
selling supplies needed to meet local demand both in Bogale and
Labutta townships.

5. (SBU) The villagers we met expressed appreciation for the
efforts of the UN and NGO community to procure and deliver what aid
workers believed were essential goods, but lamented that much had
not been useful. For example, tarps were too hot and could not
withstand the wind. Many tools in shelter reconstruction kits were

RANGOON 00000540 002.4 OF 003


not suited for use with bamboo. Because each person's specific
needs were different, and appropriate goods were available locally,
the villagers stressed that they were in a better position to
procure what they needed and asked us to help them do so with cash.

6. (SBU) Affected residents acknowledged that the regime had made
efforts to assist them, but described those efforts as inadequate.
All three villages we visited had received seeds from the
government, contrary to reports the regime had limited distributions
to large landowners. However, residents complained that they did
not get enough seeds to plant in all available fields. Some farmers
had been given mechanical tillers to replace the draught animals
lost in the storm. But at least one local farmer confided to us
that the government-provided tillers needed major repairs before
they would work. The local healthcare provider in one village
informed us that government mobile health teams had visited every 15
days since the storm. Many residents said they had not sought
treatment from the teams, however, without explanation.

MICROFINANCE
------------

7. (SBU) While in Bogale, we met with workers from Pact, a US-based
NGO that has run a microfinance program in the delta since 1997.
Since its inception, Pact has provided small loans to over 100,000
residents of the delta, over 50,000 of whom live in the three most
cyclone-affected townships. Pact officials told us the size of the
average loan was approximately 150,000 kyat (US$ 130). Borrowers
used this money to improve their businesses and livelihoods. Over
80 percent of the over 200 residents we met had taken out a Pact
loan before the cyclone and nearly all reported they would do so
again, if the program were available.

8. (SBU) Since the cyclone, Pact has decided to forgive the
repayment of loans in the three most affected townships. As of
early May, there were approximately USD 2.8 million in outstanding
loans that Pact planned to forgive. Additionally, as part of its
lending program, Pact created savings accounts for borrowers and has
permitted them to withdraw approximately 60 percent of these savings
since the cyclone. As a result of the loan forgiveness and savings
withdrawals, Pact no longer has the capital to continue its
microfinance program, despite the greater demand in the community.
Pact has requested financial assistance from the donor community to
recapitalize their lending program (see septel).

COMMENT
-------

9. (SBU) Despite the devastation wrought by Nargis, the residents
of Bogale township have taken the initiative to begin rebuilding
their communities. Far from helpless victims, the local residents
we met were sophisticated enough to know what they needed and
resolute enough to get the job done. Residents repeatedly and
clearly told us that cash, not commodities, will do them the most
good. Local markets are functioning and an infusion of capital
would allow affected families to procure the specific goods they
need to re-start their livelihoods. The Than Shwe regime has shown
little interest or ability to meet the needs of the cyclone's
victims. While well intentioned, some of the efforts of the aid
community to procure commodities on behalf of these communities have
not been appropriately tailored to the victims' needs. Inherent
efficiencies of the local markets that are functioning throughout
the delta should be used to correct these problems. We recommend

RANGOON 00000540 003.4 OF 003


funding NGOs like Pact to get capital into these devastated
communities through microfinance programs. By doing so we will help
the Burmese people help themselves.

VILLAROSA

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