Caribbean Disaster Mitigation Project
Implemented by the Organization of American States
Unit of Sustainable Development and Environment
for the USAID Office of Foreign Disaster Assistance and the Caribbean Regional Program


Investing in Mitigation: Costs and Benefits

One of the principal lessons that has emerged from the implementation of the Caribbean Disaster Mitigation Project (CDMP) is that disaster mitigation is a difficult sell. Homeowners overwhelmingly prefer to invest in the exterior appearances and comfort of their dwellings rather than in improving wind resistance of roofs or installating shutters to protect windows. Governments and private sector interests traditionally fail to consider the potential effects of natural hazards when investing in physical or economic infrastructure. In addition, major institutional limitations persist in the enforcement of such risk reduction measures as land use zoning and building code regulations.

The technical challenges of disaster mitigation are well understood. Significant progress has been made in hazard mapping and vulnerability assessment. Appropriate development guidelines and construction standards exist to ensure that structures are located away from hazard prone areas and can withstand the forces of wind or ground acceleration. Yet, there is a need to address the persistent obstacles of public perception, political expedience and institutional weakness if any headway is to be made in reducing the vulnerability of population, infrastructure and economic activities.

The most common response from the political directorate in the Caribbean to programs that would reduce vulnerability through more stringent building and development standards remains: "Our nation is too poor to afford the required standards." The challenge of the CDMP and similar programs that promote safer development consists in debunking this myth, by demonstrating that it is cost-effective to invest in mitigation of natural hazards. The purpose of this web page is to bring together papers and study results that help adress the above challenges.

OAS/CDMP Resources

To better understand the factors which contribute to infrastructure vulnerability in the Caribbean, the CDMP undertook in 1997/98 a retrospective study of four major projects which failed due to the effects of natural hazards. This study, Causes of Building and Infrastructure Failure due to Natural Hazards, aimed to identify the optimal points in the development and development review cycle for introducing hazard mitigation information. For two of the projects reviewed in this study, detailed estimates were produced of the cost of additional mitigation that would have been required to avoid the damage that occurred. These estimates can be compared to the costs of the original construction and the post-disaster reconstruction to quantify the costs and benefits of hazard mitigation. These two cases are described in the paper Costs and Benefits of Hazard Mitigation for Building and Infrastructure Development: A Case Study in Small Island Developing States, which was presented at the 1998 conference of The International Emergency Management Society in Washington DC, May 1998.

In conjunction with the World Bank, the CDMP undertook a study to estimate the probable maximum loss of public sector infrastructure from a hurricane event in Dominica, Saint Kitts and Nevis and Saint Lucia.Included in the selection of lifeline infrastructure elements are: electrical power generation facilities, airports, seaports, road networks, water and sanitation facilities, waste management sites, schools and hospitals. Using infrastructure information collected by local engineers, the study produced a comprehensive inventory of all facilities and structures; estimated replacement values; summary of potential retrofitting, protection, or reconstruction needs; and estimated loss potential associated with a maximum likely hurricane event. The resulting information can be used by the countries and the World Bank as a basis for preparing proposals for retrofitting/reconstruction investment projects.

The OAS has long been interested in the economic implications of natural hazards. The paper Natural Disasters: Linking Economics and the Environment with a Vengeance was originally written in 1989, but continues to provide a relevant framework for the current investigations into the costs and benefits of hazard mitigation. Under the CDMP, a study of the Costs and Benefits of Hazard Mitigation in the Construction Industry was undertaken in Jamaica. This study describes effects on buildings in Jamaica from hurricane Gilbert and an earthquake in Woodford and identifies appropriate mitigation measures, with estimated costs for implementation of these measures.

Other Resources


Anderson, Mary B. "Which costs more: prevention or recovery?" Managing Natural Disasters and the Environment: Selected Materials from the Colloquium on the Environment and Natural Disaster Management, June 27-28, 1990. World Bank: Washington, DC.

United States

The US Federal Emergency Management Agency (FEMA) has released a report entitled Costs and Benefit of Natural Hazard Mitigation, which describes the results of 16 case studies of hazard mitigation measures that were implemented throughout the United States.


Note: More information on these documents is available from the Australian IDNDR Coordination Committee: [email protected].

Paul Thompson and John Handmer, Economic Assessment of Disaster Mitigation: An Australian Guide, Flood Hazard Research Centre, Middlesex University for the Austrailan IDNDR Coordination Committee, November 1996 (90 pages).

John Handmer and Paul Thompson, Economic Assessment of Disaster Mitigation: A Summary Guide, Centre for Resource and Environmental Studies, Australian National University, November 1996. An Australian IDNDR Committee funded project. (27 pages).

IDNDR Legal Aspects of Natural Disaster Prevention, Part 1: The Use of Economic Instruments for the Prevention of Natural Disasters, United Nations, October 1996.

Romulo Caballeros Otero & Richard Zapata Marti, The Impacts of Natural Disaster on Developing Economies: Implications for the International Development and Disaster Community. (Paper submitted for the technical session on the Economic Aspects of Natural Disaster Reduction for Sustainable Development during the World Conference on Natural Disaster Reduction, Yokohama Japan 23-27 May 1994).

CDMP home page: Project Contacts Page Last Updated: 20 April 2001