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Nepal may need between $4 billion and $5 billion to rebuild after this week’s devastating floods triggered by a glacier collapse, Finance Minister Swarnim Wagle said Saturday.
The preliminary estimate is equivalent to nearly 10 per cent of Nepal’s economy, although authorities have yet to complete a full assessment of the damage.
“The initial estimate is between $4-$5 billion. Just an estimate,” Wagle said. “We will require much less than what we needed for the 2015 earthquake. Loss and damage is being assessed.”
The disaster began on Wednesday when a glacier collapse unleashed a massive torrent of rock, ice, mud and debris through Himalayan river systems. More than 600 people have been reported dead in Nepal and China’s Tibet, while more than 2,000 remain unaccounted for.
The floods devastated settlements along the border, sweeping away bridges and roads and damaging major hydropower facilities.
The disaster is expected to deal a major blow to Nepal’s economy, which depends heavily on remittances, tourism and hydropower. Damaged power projects account for more than 12 per cent of the country’s total electricity-generating capacity.
The estimated reconstruction cost remains well below the roughly $9 billion in losses and reconstruction needs following Nepal’s magnitude-7.8 earthquake in 2015. The earthquake killed nearly 9,000 people, destroyed more than 500,000 homes and caused losses estimated at around one-third of the country’s economy.
Wagle did not explain why the latest reconstruction bill is expected to be lower than the cost following the earthquake.
The government is continuing to assess the extent of the destruction and the financial requirements for reconstruction as rescue and recovery operations continue.
