Bracing for the Storm

Author:Inci Ötker and Krishna Srinivasan
Pages:49-51
 
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İnci Ötker and Krishna Srinivasan
For the Caribbean, building resilience is a matter of survival
Besides their captivating b eauty, one thing
the Caribbean countr ies have in common
is their vulnerabil ity to frequent and costly
natural dis asters. Many are among the 25
most vulnerable nations in terms of disasters per
capita or land area. Irma and Maria—the two
Category 5 hurricanes that hit the Caribbean in
September 2017—are the most recent tropical
storms that have devastated the region, causing
substantial loss of life a nd widespread destruction
from the Turks and Caicos Islands to Dominica.
Natural disasters have massive economic and
human costs: they take a deep toll on growth
prospects and erode scal cushions. Huge recon-
struction costs in t heir aftermath crowd out scarce
resources for health, education, and soc ial spending.
And climate cha nge will only intensify these risk s.
Countries can adopt policies to reduce t he human
and economic costs of disa sters and build resilience
to future shocks through better preparation and a
more eective response.
High vulnerability
Since 1950, 511 disasters worldwide have hit small
states—that i s, developing economies with popu-
lations of less than 1.5 million. Of these, 324 were
in the Caribbean, home to a predominant share of
small states, k illing 250,000 people and aecting
more than 24 million through injury and loss of
homes and livelihoods.
e Caribbean’s vulnerability is cha racteristic
of small island state s, but this region has typically
suered more damage than others. Average esti-
mated disaster da mage as a ratio to GDP was 4.5
times greater for small st ates than for larger ones,
but six times higher for countries i n the Caribbean.
Moreover, the region is seven times more likely to
be hit by natural disa sters than larger states and
twice as likely as other small state s (see chart).
e economic cost of these disasters for the
Caribbean is subst antial, exceeding $22 billion (in
constant 2009 dollars) bet ween 1950 and 2016, com
-
pared with $58 billion for similar d isasters globally.
For some countries, the damage wel l exceeds the size
of the economy: Hurricane Maria is estimated to
have cost Dominica 225 percent of its GDP, while
the hurricane dam age for Grenada in 2004 was 200
percent of GDP, leaving huge reconstruct ion needs
that can ta ke years to fulll.
Climate change is expected to compound the
problem by making such disasters more frequent
and severe. While the Caribbean accounts for a
tiny part of greenhouse g as emissions globally, it is
disproportionately more vulnerable to climate r isks.
Large shares of t he region’s population live in high-
risk areas with we ak infrastruct ure. Moreover, their
economies rely heavily on sectors sensitive to weather,
such as tourism and agric ulture, while capacity and
resources to manage risk are limited. Recurrent
oods, droughts, hurricanes, and rising sea levels pose
Storm
Bracing for the
March 2018 | FINANCE & DEVELOPMENT 49

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