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close this bookA World Safe from Natural Disasters - The Journey of Latin America and the Caribbean (PAHO; 1994; 111 pages) [ES]
View the documentForeword
View the documentAcknowledgements
open this folder and view contentsChapter 1: No shortcuts to disaster reduction
open this folder and view contentsChapter 2: An overview of the region
close this folderChapter 3: What puts Latin America and the Caribbean at risk?
View the documentNatural hazards in Latin America and the Caribbean
View the documentGeological hazards
View the documentHydrometeorolocical hazards
View the documentVulnerability
View the documentThe relationship between disaster and development
View the documentRisk in Latin America and the Caribbean
open this folder and view contentsChapter 4: The wake-up call: From improvisation to response planning
open this folder and view contentsChapter 5: Disaster preparedness takes center stage
open this folder and view contentsChapter 6: One step ahead of disasters: Mitigation and prevention
open this folder and view contentsChapter 7: Looking toward the future
View the documentReferences
View the documentAcronyms
 

The relationship between disaster and development

Nations increase their capacities and decrease their vulnerabilities through development. Development planning is used by governments to draft plans to guide economic and social development. The concept of sustainable development is widely recognized by international agencies and by governments, although its definition is not universally agreed upon. Sustainable development is the outcome of comprehensive planning that incorporates considerations of disaster risk (reducing hazards and vulnerability) as well as strategies designed to protect the environment and to improve economic growth, levels of education, and living conditions of the entire population (see Box 3.7).

Box 3.7

NATURAL DISASTERS AND DEVELOPMENT OFFER BOTH OPPORTUNITIES AND OBSTACLES

Disasters

Disasters can provide unique windows of opportunity in development. In the wake of the 1986 earthquake in El Salvador, the health sector took advantage of the severe damage to the large Children's Hospital to restructure and decentralize services so that the nation would not be dependent on the services of one "megahospital."


Disasters +

The El Salvador earthquake also had extreme social and developmental consequences: scarcity of housing, high unemployment (26-35%), and a reduced capacity in public health facilities. Hurricane Joan, which ravaged the Atlantic coast of Nicaragua in 1988, also had serious effects on an already failing economy during a difficult political and economic period.


Disasters -

Development

Housing or infrastructure projects built in accordance with construction safety codes are less vulnerable because they have been designed to better withstand disaster impact. Research into construction of adobe dwellings in Peru, for example, aims to improve the performance of old and new dwellings in future seismic events.


Development +

Activities related to development projects - such as quarrying for construction materials or indiscriminate clearing of forests for agricultural purposes - can degrade soil conditions, thereby increasing the risk of disasters. Other projects designed as income-generating opportunities can accelerate urban growth and force lowincome workers to seek housing in marginal, hazardprone areas.


Development -

Source: PAHO/WHO: IDNDR Regional Office.

Economic losses caused by a disaster of great magnitude often exceed the annual gross income of a country It is not surprising then that these events can paralyze the affected countries and cause social and political disturbances. The World Bank has estimated that in developing countries, the economic losses due to disasters, as percentages of the gross domestic product (GDP), are 20 times higher than in industrialized countries.

According to the Economic Commission for Latin America and the Caribbean (ECLAC), disasters have three types of economic repercussions: direct effects on property; indirect effects caused by losses in economic production and services; and secondary effects that are manifested after the disaster in a reduced national revenue, increased inflation, problems of foreign trade, increased public spending, the resulting fiscal deficit, and reduced monetary reserves.

Table 3.2 presents estimated economic losses caused by selected natural disasters in Latin America and the Caribbean. Although these losses are not devastating for industrialized countries with strong economies, they have serious and lasting effects on the susceptible economies of developing countries. For example, drought and floods in Bolivia, Ecuador, and Peru associated with El Niño reduced the per capital income by 10% and elevated some retail food prices by 50%. Although the direct losses caused by the Mexico earthquake were equivalent to only 2.7% of the GDP, the expenditures for reconstruction and rehabilitation of basic services wreaked havoc on the economy, at a time when Mexico was operating under a policy of fiscal austerity.

Table 3.2 ECONOMIC LOSSES CAUSED BY NATURAL DISASTERS IN LATIN AND THE CARIBBEAN

(in millions of 1987 US dollars)a

 

Earthquakes

Hurricanes

Floods/ droughts

Losses & effects

Mexico City

Ecuador

David & Frederick

El Niño

 

1985b

1987c

1979d

1982-1983e

Total losses

4,337

1,001

1,057

3,970

Direct losses

3,793

186

842

1,311

Capital stock

3,777

184

506

1,060

Inventories

16

2

230

251

Production

0

0

106

0

Indirect losses

544

815

215

2,659

Production

154

704

185

1,2X4

Services

390

111

30

1,375

Secondary effects

       

Public sector finances

1,899

397

303

..g

Increased expenditures

2,025

55

264

..g

Decrease in revenues

(126)f

342

39

..g

External sector

8,579

781

464

621

Reduction of exports

1,650

635

167

547

Increase in imports

9,075

155

296

74

Disaster-related income

(2,146)f

(9)f

-

-

a All figures adjusted for inflation through 1987 to enhance comparability.

b Secondary effects estimated for 1986 to 1987, and projected thereafter through 1990.

c Includes damages caused by ensuing floods and mudflows which represent a very high percentage of the total.

d Damages refer to the Dominican Republic only, even though other countries were affected as well.

e Damages refer to Bolivia, Ecuador and Peru, although other countries were affected as well.

f Figures in parentheses refer to income gained from insurance and foreign donations.

g Produced significant increases in the fiscal deficit; exact figures are not available.

Source: Jovel, 1989. Reprinted from Disasters and Development, UNDP/UNDRO, 1991.

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