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


Disaster Risk Reduction as a Development Strategy

Jan C. Vermeiren
Unit of Sustainable Development and Environment, Organization of American States

Note: This paper was originally presented at the Caribbean Session of the 1993 National Hurricane Conference, held in Orlando, Florida, 13 April 1993.

Natural disasters pose a growing threat to the development strategies of Caribbean countries by destroying infrastructure and productive capacity, interrupting economic activity, and creating irreversible changes in the natural resource base. With increasing frequency, countries in the region are facing situations in which scarce resources that were earmarked for development projects have to be diverted to relief and reconstruction following disasters, thus setting back economic growth.

Disasters also directly impact on the foreign exchange earnings capacity of a country, at a time when extra resources are needed to finance imports of food, energy, and inputs for the agricultural and manufacturing sectors. If sustainable development is to be achieved in the Caribbean region, countries will have to take effective measures to reduce their vulnerability to natural disasters.

The underwriting losses suffered by Caribbean property insurers in the aftermath of the recent hurricanes have reduced the availability and increased the cost of reinsurance. This in turn has led to a defensive reaction on the part of insurance companies and agents in the region, who are advising their clients that hurricane coverage will not be as readily available as before, and that, when available, costs will be higher, and property owners will have to bear a larger share of the risk.

As a consequence, property insurance, the traditional mechanism for reducing economic risk from catastrophic events, is no longer as available or affordable as in the past. This development is now forcing property owners and developers to seriously look at other mechanisms to minimize the consequences of natural disasters. Time has come to practice disaster loss reduction in a systematic way, as an integral part of ongoing development planning and investment.

A Practical Approach to Risk Reduction

To embark on a systematic campaign of disaster risk reduction, be it in existing development or in designing new development, planners, developers and property owners first of all need access to information on vulnerability reduction measures and their implementation, and secondly, they need to present convincing economic justification for the required investments in vulnerability reduction.

Access to Technical Information on Vulnerability Reduction

The research community has produced a vast body of knowledge on structural and non-structural mitigation measures designed to prevent or reduce the impact of natural disasters. The problem is that this information remains to a large extent within the domain of the research community and its scientific papers.

The challenge consists in translating this information into a format that can be understood by the development community, and in disseminating it to property owners, developers, and government planners.

Economic Analysis of Investments in Vulnerability Reduction
In the public as well as private sectors, long term hazard mitigation and vulnerability reduction quite often have to compete for scarce investment resources with other development initiatives addressing basic infrastructure, production and employment needs.

The benefits of long-term hazard mitigation go beyond economics, as the reduction in vulnerability to disasters contributes to individual security, social stability and sustainable development. Nevertheless, economic arguments built on a sound benefit-cost analysis are essential when one has to defend the use of scarce resources for investment in mitigation.

Few case studies on benefit-cost analysis of investment in vulnerability have been documented. Such studies are urgently needed to serve as models for better articulation of the benefits of investing in mitigation, and for more accurate estimates of the costs of alternative mitigation options.

Development as a Contributing Factor to Disaster Risk

Each disaster leaves in its wake an overwhelming volume of evidence of human ignorance or neglect that directly contributed to the magnitude of the damages. It is therefore not surprising that a systematic analysis of how decisions made by planners and developers may contribute to vulnerability and the consequent risk of disasters will effectively identify where hazard mitigation and risk reduction may be best be applied.

This analysis is helped by recognizing the following three broad categories of physical vulnerability of development in hazard prone areas:

Development and Vulnerability
Site Vulnerability
  • Locating new development in hazard prone areas without protective measures
  • Introduction of hazardous activities in proximity to developed areas
  • Inadequate provision of safe and affordable sites for settlement expansion
  • Over-concentration of development beyond disaster response/evacuation capability
Structural Vulnerability
  • Use of inadequate design and building standards
  • Lack of appropriate maintenance of infrastructure and facilities
  • Insufficient capital investment in infrastructure to meet growth in demand
Loss of Natural Protective Systems
  • Deforestation in watershed areas
  • Deforestation of wetlands, reefs, dunes
  • Unsustainable use of natural resources

How to Mitigate Disaster Risk

Hazard mitigation is defined as any action taken to permanently eliminate or reduce the long-term risk to life and property from natural and technological hazards. The wide variety of actions that fall under this definition can usefully be categorized as risk avoidance measures—primarily of a nonstructural nature—risk spreading measures, and structural vulnerability reduction measures.

The use of one type of mitigation measure does not exclude any other type of measure. Structural and non-structural measures can be selected to complement each other, and can be effectively integrated in a multi-sectoral or area-wide disaster mitigation plan.

Hazard Mitigation Options
Risk Avoidance Measures (Non-structural measures)
Discourage location of settlements, infrastructure and economic activities in known hazardous areas through:
  • Land-use regulations, ordinances
  • Financial incentives or penalties
  • Disclosure of risk information
  • Public infrastructure policy
  • Natural resource management policy
Risk Spreading Measures
  • Property damage and revenue loss insurance
  • Crop diversification
  • Redundancy in lifeline systems
Vulnerability Reduction Measures (Structural measures)
Physical measures designed to enhance natural hazard impacts:
  • Retrofitting of existing structures
  • Use of appropriate building standards
  • Reducing hazard proneness of site (dams, retaining walls, windbreaks)

What Costs More: Preventing or Rebuilding

The decision to invest in measures that can protect property against possible damages from disasters is primarily an economic decision. It should therefore be taken in the framework of an economic analysis, evaluating the costs of investing in mitigation or prevention against the expected benefits, in terms of risk reduction, that will be derived from the investment.

For new development projects, the economic analysis of mitigation should be implemented as part of the project appraisal phase. For retrofitting of existing development, the analysis must be carried out on a stand-alone basis.

Benefit-Cost Analysis
Methodological Factors
  • Quality of risk information
  • Planning horizon/lifespan

Present Value of Costs

  • Cost of adhering to stricter standards
  • Cost of protective works
  • Cost associated with foregoing the use of hazardous areas
Expected Value of Benefits
Project-specific benefits:
  • Reduction in maintenance costs
  • Reduction in insurance costs
  • Losses/damage avoided

Socio-economic benefits:

  • Continuity in services
  • Contribution to sustainable development
  • Improved investment climate

Cost Of Mitigation Measures In Relation To Value Of Building

All empirical evidence shows that it is significantly more cost-effective to design and build a structure to standards that would withstand maximum expected wind or seismic forces in a given location, rather than build to lower standards and suffer the damages.

Field observations after recent hurricanes have shown that loss of roof material and failure of doors and windows are the main contributors to property damage. Failures of this nature could be avoided through the use of proper materials and improved workmanship, factors that would add minimally to the cost of a building.

Examples of Mitigation Costs for New Construction and Retrofitting

Seismic Risk New Construction Retrofitting
Hospitals in Costa Rica 6% to 8%
Public Buildings in California Less than 5% Up to 40%


Hurricane Wind Risk New Construction Retrofitting
Hotels in Jamaica—measures included in retrofit that would have prevented original damage Less than 1%
Florida housing—increase design windspeed from 110 mph to 140 mph 2% to 3%

Where to Apply Disaster Mitigation

Opportunities for natural hazard mitigation can be found anywhere where population, infrastructure or economic activities are at risk of disruption or destruction from extreme natural events. Which vulnerability reduction actions to consider will depend on what is to be protected, on the priorities set by those affected, and on the resources made available for their implementation.

In selecting opportunities for hazard mitigation it is essential to remember that the most effective approach to reducing the long-term impact of natural hazards is to incorporate hazard assessment and mitigation activities into the process of integrated development planning and investment project formulation and implementation.

Targets for Vulnerability Reduction
Family Shelter
  • Self-help retrofitting
  • Local-level hazard mapping
  • Protection vs. relocation
  • Safe areas for expansion
Community Infrastructure
  • Community-based hazard assessment
  • Participation in monitoring and maintenance
  • Back-up systems
  • Standards for critical facilities
Productive Sector Assets and Infrastructure
  • Stimulate private sector initiatives
  • Zoning and standards
  • Incentives for mitigation
  • Insurance premium credits for mitigation
National Infrastructure and Utilities
  • Systematic vulnerability analysis
  • Retrofitting
  • Standards for new construction
  • Sound capitalization
CDMP home page: Project Contacts Page Last Updated: 20 April 2001