Private Enterprise and Financial Markets > Environment > Disaster Risk Management
Natural Disasters in Latin America and the Caribbean: An Overview of Risk
By Céline Charvériat (10/00, En)
This working paper is being published with the sole objective of contributing to the debate on a topic of importance to the region, and to elicit comments and suggestions from interested parties. This paper has not gone through the Department's peer review process or undergone consideration by the SDS Management Team. As such, it does not reflect the official position of the Inter-American Development Bank.
Natural disasters can be defined as temporary events triggered by natural hazards that overwhelm local response capacity and seriously affect the social and economic development of a region. The sources of risk in Latin America and the Caribbean are both natural and man-made. Because of its geographical conditions, the region is prone to natural events of severe intensity. But the large economic and human cost associated with these natural events is mainly the result of extreme vulnerability. This vulnerability stems from the pattern of socioeconomic development in the region as well as inadequate risk management policies.
Despite renewed preventative efforts at regional and international levels, the risk associated with natural events has not decreased. Economic costs can be expected to increase, as economic assets accumulate and economic interdependence reaches new levels. While the human toll taken by disasters has remained more or less stable, it is unlikely to decrease because of the persistence of widespread poverty, continuing demographic growth and migration towards coasts and mega-cities. Finally, preliminary evidence regarding climate change seems to indicate that the probability of occurrence of severe weather events will rise in the region.
In the last five years, the Latin American and Caribbean region suffered from several large natural disasters whose magnitude, in terms of fatalities and damages, has renewed national governments? and international donors? interest in better managing risk.
Natural disasters, though, are hardly a novelty in the region. They have had a considerable importance in its history and its economic development. Historians now believe that an unusually long and severe drought was a primary cause of the disappearance of the Maya civilization. During the past thirty years alone, there have been an average of 32.4 disasters per year, which have caused a total of 226,000 fatalities (or around 7,500 deaths a year) in the region. In addition to causing fatalities, homelessness and injuries, natural disasters have represented an enormous cost for the countries affected and the international community. In this paper, we estimate that the annual average cost between 1970 and 1999 ranges between $700 million and $3.3 billion. Due to the disruption of economic activity and the loss of capital assets they provoke, natural disasters have had negative short-term effects on GDP growth. In many instances, disasters have also resulted in longer-term economic consequences, such as slower growth, higher indebtedness and higher regional and income inequality. Environmental and social costs, though more difficult to assess in monetary terms, have also been substantial.
Rather than taking a proactive approach towards risk management focused on risk reduction and preparedness, the region continues to rely upon costly reconstruction processes and post-disaster international assistance. This reactive stance is not only costly in terms of lives and destroyed assets, but also appears largely unsustainable as worldwide international assistance decreases and natural disaster proneness increases everywhere. This is why the improvement of risk management appears essential to guarantee the protection and future progress of economic and social development in the region.
Last updated: 06/12/07
