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  • Guest Editor collection: 9 Mar 2016 Hori Tsuneki

    Inter-American Development Bank
    http://www.preventionweb.net/go/48127

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Does disaster risk increase or reduce in Latin-American and Caribbean countries? An implication from the IDB’s Disaster Risk and Risk Management Indicators

In disaster risk management we need to monitor whether a disaster risk condition is reducing or increasing, and analyze the reasons before taking any action to reduce potential risks. The question raised here is how can we monitor disaster risk management situations? The Inter-American Development Bank (IDB) has developed in 2004 an instrument to illustrate a country’s current disaster risk and risk reduction performance. A “family of indicators” of the IDB made up of the five Indicators: Disaster Deficit Index (DDI), Local Disaster Index (LDI), Prevalent Vulnerability Index ( PVI), Risk Management Index (RMI), Governance and Public Policy Index (IGOPP). Despite the overall positive results shown by the IDB Indicators in terms of the regions’ disaster risk reduction progress in recent decades, the impact of disasters in the region tripled in the last few decades. This indicates that the positive results shown in the IDB‘s family of “inductive” indicators does not match with the extent of the disasters’ impact. What does this mean?

Presentation

When you need to check your health, you might take a blood test, and if the results are unexpected, you may take some action such as taking medicines, choosing healthier foods, or exercising more. When you want to check a country’s macroeconomic performance, you might check a stock market chart; and, if you see an unexpected result, such as a fall in the Dow Jones index, you may take some action to protect your financial resources. Prior to acting in any given situation, we often rely on indicators to decide whether or not a current value or performance is favorable. Similarly, in disaster risk management we need to monitor whether a disaster risk condition is reducing or increasing, and analyze the reasons before taking any action to reduce potential risks. The question raised here is how can we monitor disaster risk management situations?

In reviewing the historical number of deaths or economic losses due to disasters, international databases such as the EM-DAT database or the DesInventar database can be analyzed. However, is this the best way to check the disaster risk conditions of a particular country? In Japan, for example, there were nearly 20,000 disaster- related deaths in 2011 according to the EM-DAT database, mainly due to the northeast earthquake and tsunami that took place in March 2011. However, the number of deaths in the following year was 170, much less than in 2011. Does this mean that Japan’s disaster risk condition and disaster risk reduction had improved in 2012 as compared with 2011? Not necessarily; historical data does not always reflect a country’s current disaster risk or risk reduction performance.

Therefore, we need other indicators to monitor these two situations.

How about consulting the Hyogo Framework for Action (HFA) progress reports? It seems like a good idea to understand the evolution of a country’s disaster risk reduction efforts and, because many countries published HFA progress reports from 2007 to 2014 on the Preventionweb portal, it is easy to verify a country’s performance. Unfortunately, the HFA monitoring system is soon to be replaced with new evaluation criteria based on the Sendai Framework, and therefore we need to consult another long-lasting indicator to assess risk reduction actions.

The Inter-American Development Bank (IDB) has developed in 2004 an instrument to illustrate a country’s current disaster risk and risk reduction performance. On commencement of the IDB development process, the IDB wished to develop a single indicator to measure current disaster risk and risk reduction performance. However, this did not prove possible as determining disaster risk and risk reduction performance were found to be extremely complex exercises involving multiple perspectives. Finally, therefore, the IDB developed a “family of indicators” made up of the following:

  • The Disaster Deficit Index (DDI) that measures country risk from a macro-economic and financial perspective when faced with future and possibly catastrophic events. A DDI greater than 1.0 indicates that the economic losses would exceed the country’s financial capacities (the greater the DDI, the greater the financial gap).
  • The Local Disaster Index (LDI) that identifies the extent of spread and damage resulting from small-scale disasters in all parts of a country. The LDI indicators range from 0, when there is a high concentration of small disasters in a few local areas, to 100, where a majority of the areas in a country’s territory suffer from small disasters.
  • The Prevalent Vulnerability Index (PVI) that measures three natural hazard vulnerability aspects: hazard exposure and physical susceptibility, socioeconomic fragility, and resilience. The PVI ranges from 0, which indicates minimum vulnerability, to 100, which indicates a very high vulnerability.
  • The Risk Management Index (RMI) that measures performance, or institutional capacity in terms of the actions taken to understand the risk, mitigate and prevent disaster risks, prepare for future disasters, and recover from catastrophes. The RMI ranges from 0 (low-level performance) to 100 (high -level performance).
  • The Index of Governance and Public Policies (iGOPP) that identifies good practices in the disaster risk management public policy and regulatory framework.

This family of indicators has two common characteristics. The first is retrospectivity, which means that the indicators can be applied using mostly statistical data from the year(s) needed and even from previous decades. The second characteristic is the stable and unchanging criteria, which allows for long-term monitoring of a country’s disaster risk and risk reduction performance. These characteristics allow for a review of countries’ disaster risk and risk reduction performance over a longer period of time.

The target countries for the application of this family of indicators are 26 IDB member countries: Argentina, the Bahamas, Barbados, Belize, Bolivia, Brazil, Chile, Colombia, Costa Rica, the Dominican Republic, Ecuador, El Salvador, Guatemala, Guyana, Haiti, Honduras, Jamaica, Mexico, Nicaragua, Panama, Paraguay, Peru, Suriname, Trinidad and Tobago, Uruguay, and Venezuela. Application of the indicators is still ongoing; some indicators have been completed for all 26 countries, while others are expected to be applied soon.

IDB has recently finished updating the results from 15 of the 26 countries: Argentina, Belize, Bolivia, Chile, Colombia, Costa Rica, the Dominican Republic, Ecuador, El Salvador, Guatemala, Jamaica, Mexico, Nicaragua, Peru, and Venezuela. The results have been summarized as Technical Notes for each country and are published on the IDB portal site. An overview of the indicator results in these 15 countries indicates that there has been some progress in the Latin-American and Caribbean regions with regards to disaster risk and risk reduction.

First, almost all the DDI values in the 15 countries have improved from 2000–2012, with the average DDI100 value being 1.25 in 2000, compared with 0.70 in 2012 (DDI100 indicates a DDI value for a high magnitude event in a 100-year span). This indicates that the countries in the region were sufficiently financially capable in 2012, more than 40% greater than in 2000, to respond to an event even when a 1/100 magnitude disaster occurs. Second, the average LDI value of the target countries experienced almost no change from 1986–1990 (LDI average was 34.3) to the latest data in 2006–2010 (34.2). This indicates that the relative area affected by small-scale disasters remained at the same level over the last two decades.

Third, the target countries’ average PVI value improved by more than 20% from 1990 - 2011, from 45 in 1990 to 36 in 2011. This result indicates that these countries had successfully reduced their vulnerability to the impact of hazardous events.

Finally, the average RMI value improved by 30% from 2000 - 2013 within the 15 countries, from 29.41 in 2000 to 37.68 in 2013. This indicates that the countries improved their disaster risk reduction performance (mostly institutional performance in this case). In summary, the IDB family of indicators provided three types of information about the positive disaster risk reduction progress within their member countries: (i) they indicated that there was a greater financial capacity to respond, even if a 1/100 scale disaster occurs; (ii) they indicated the extent to which the countries reduced their vulnerability to the impact of hazardous events; and (iii) they indicated the extent to which institutional capacity to risk reduction had improved.

However, do these favorable results always indicate a bright future for these Latin-American and Caribbean countries with regard to disaster risk reduction? This shall be discussed in the next section.

Conclusion

Despite the overall positive results shown by the IDB Indicators in terms of the regions’ disaster risk reduction progress, according to the EM-DAT, the impact of disasters in the region tripled in the last few decades from over 33 million people affected and US$40 billion in damages from 1991–2000, to 90 million people affected and US$90 billion in damages from 2006–2015. Unfortunately, these figures indicate that the positive results shown in the IDB‘s family of “inductive” indicators does not match with the extent of the disasters’ impact. What does this mean? Why don’t the IDB indicators correctly assess the countries’ disaster risk reduction performances? To answer this question, we require an insight from a more detailed analysis.

Let us first examine the DDI. This indicator calculates the ratio between the probable maximum economic losses due to disaster and the available financial resources to recover from the catastrophe. The DDI numerator—the available amount estimated for recovery from the catastrophe—increased more than 5 times from 2000 to 2012. This indicates that countries drastically increased their available financial resources to deal with future catastrophes, which is good news. However, on reviewing the details of the estimated amount it was found that many countries still expected to receive donations and grants or funding from international donor agencies and multilateral development banks to access resources in times of catastrophe. In turn, the countries assigned only a small portion of the disaster funds and disaster insurance/reinsurance. This is a challenge for these Latin-American and Caribbean countries because, although the overall DDI value showed improvement, these countries will need more of their own resources such as disaster funds and insurance/reinsurance to ensure a rapid response to any catastrophe.

The LDI measures the distribution of local-scale disasters based on the number of deaths, the number of affected people, and economic losses. Even though the LDI total value remained similar between 1986–1990 and 2006–2010, this result only reflects the contribution or diminution in the relative area of the deaths due to local-scale disasters. However, the number of areas in which people were affected (but not dying) increased across these two timescales, thereby potentially indicating that the probability of small-scale disaster occurrences was still increasing. This may be due to a rise in the informal settlements in hazard prone areas where people had not previously settled, such as on the outskirts of metropolitan areas. This is another challenge.

The PVI consists of 24 sub-indicators, and although the overall PVI value improved more than 20% from 1995 to 2011, nine of the 24 sub-indicators worsened across these two timescales. These sub-indicators included lower human development indices than other regions, fewer hospital beds per population, and reduced environmental sustainability. In summary, there are still many socioeconomic factors that need to be improved to reduce vulnerability, which poses an additional challenge for these countries.

The RMI consists of 24 sub-indicators grouped in four areas: risk identification; risk reduction, such as mitigation and risk prevention; disaster preparedness; and financial protection against future catastrophes. The analyses indicated that the risk reduction sub-indicators had significantly less progress than others: risk identification improved by 30% from 2000–2013, disaster preparation improved by 20%, financial protection improved by 30%, but risk reduction only improved by 9%. The risk reduction sub-indicator group includes performances related to land use planning, environmental protection, hazard-event mitigation works, and housing improvements. Therefore, another challenge is to ensure that there are further effective disaster risk reduction measures concerning these factors.

In summary, Latin-American and Caribbean countries still face challenges when seeking to reduce disaster risk and to improve risk reduction. The challenges include the following: (i) increasing disaster funds and insurance/reinsurance resources to ensure rapid response; (ii) increasing control on the population expansion in hazard prone areas; (iii) reducing vulnerability by increasing socioeconomic development investment in such areas as human development and environmental sustainability; and (iv) increasing mitigation and prevention efforts.

Let us revert to the first question: Do the IDB indicators correctly illustrate the countries’ disaster risk and risk reduction performance? The answer may be yes, as, although it is true that the impact of such disasters tripled in the last few decades, it is also true that economic activities also significantly increased roughly 4 times from 1990–2010, and this fact is mirrored in the overall results of the family of indicators. In other words, the results from the family of indicators imply that, if the countries had not increased their disaster risk management efforts in recent decades, the impact due to disasters would have increased more than it did, a point illustrated by the IDB’s family “inductive” indicators.

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COLLECTION PUBLISHED

09
March
2016

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