Global Assessment Report on Disaster Risk Reduction 2013
From Shared Risk to Shared Value: the Business Case for Disaster Risk Reduction


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144 Part II - Chapter 9
Over the last decade, beach tourism destinations and island reserves in particular have experienced disasters associated with the following hazard events: Indian Ocean tsunami in 2004, Hurricanes Katrina and Wilma in 2005, and the Samoan tsunami and Fiji floods in 2009. Data on the amount of losses to the tourism sector or percentage of tourism operations and outputs exposed to hazards are not readily available. However, the few national or regional-level studies published to date all indicate significant impacts (UNEP, 2008

UNEP (United Nations Environment Programme). 2008.,Coastal Degradation Leaves the Caribbean in Troubled Waters., Environment Alert Bulletin 11. February 2008. UNEP-DEWA / GRID-Europe., Geneva,Switzerland.. .
).
In 2004, Hurricane Ivan resulted in estimated direct losses of US$900 million in Grenada—more than twice the country’s GDP. The tourism sector was particularly hard hit. Of the island’s infrastructure, 70 percent was damaged, and demand for services from the tourism sector declined for several years (World Bank, 2004

World Bank. 2004.,Grenada, Hurricane Ivan Preliminary Assessment of Damage,September 17, 2004.. .
). Apart from hotel and restaurant infrastructure, eco-tourism and agro-tourism components suffered severe damage to their resource base (Ibid.).
Later that year, the Maldives suffered direct losses from the Indian Ocean tsunami amounting to total estimated damages of US$470 million, or close to 62 percent of GDP. Of this amount, about US$100 million were losses in the tourism sector (World Bank et al., 2005). Of these losses, approximately one-half were insured. Tourism also suffered the largest indirect losses, together with the fisheries sector. With a sharp drop in tourist arrival numbers, tourism suffered the highest negative macroeconomic impact (Ibid.).
In 2009, another tsunami caused total disaster losses of US$124 million in Samoa, the equivalent of more than 22 percent of GDP (Government of Samoa, 2009

Government of Samoa. 2009.,Samoa Post-Disaster Needs Assessment: Following the Erthquake and Tsunami on 29th September 2009., GFDRR., Washington DC,USA.. .
). Losses in the tourism industry accounted for almost 15 percent of direct and 56 percent of indirect losses. With tourism receipts accounting for 65 percent of all exports (in 2009), Samoa’s efforts to recover from the global financial crisis at the time were further challenged (Ibid.).
Disasters may also cause interruptions to tourist sector supply chains, as flights are cancelled and suppliers affected. Even the warning of an impending cyclone may cause cancellations and hence indirect losses. The structure of these supply chains also makes them highly susceptible to interruptions that affect airports and air traffic in the principal markets for tourism services, such as the United States of America. Storms and extreme weather that close major airport hubs, even for a few days, can lead to cancellations in tourism destinations on the other side of the globe (Hall, 2010

Hall, C.M. 2010.,Crisis events in tourism: subjects of crisis in tourism., Current Issues in Tourism, Vol 13, No 5: 401-417.. .
).
Business may also be affected for many years after a disaster given that it depends on perceptions of destination safety and security and on the confidence tourists place in industry players (GAR 13 paperMahon et al., 2012

GAR13 Reference Mahon, R., Backen, S. and Rennie, H. 2012.,Evaluating the Business Case for Investment in the Risk Resilience of the Tourism sector of Small Island Developing States., Background Paper prepared for the 2013 Global Assessment Report on Disaster Risk Reduction., Geneva,Switzerland: UNISDR..
Click here to view this GAR paper.
; Forster et al., 2012

Forster, J., Schuhmann, P.W., Lake, I.R., Watkinson, A.R. and Gill, J.A. 2012.,The influence of hurricane risk on tourist destination choice in the Caribbean., Climate Change, Vol. 114, Issue 3-4: 745-768.. .
; Méheux and Parker, 2006

Méheux, K. and Parker, E. 2006.,Tourist sector perceptions of natural hazards in Vanuatu and the implications for a small island developing state., Tourism Management 27 (2006): 69-85.. .
). After disasters, however, tourism operators normally attempt to ensure a speedy recovery of business, playing down underlying risks, so that potential tourists see the disaster as a brief business interruption rather than a manifestation of these risks. In some cases, such as the Maldives, concerns about negative tourist perceptions have led to the withholding of disaster-related information by industry stakeholders (Becken et al., 2011

Becken, S., Hay, J. and Espiner, S. 2011.,The risk of climate change for tourism in the Maldives., In: Butler, R. and Carlsen, J., (eds): Island Tourism Development. Journeys towards Sustainability., Wallingford, UK: CABI.. .
).
Owing to lack of information dissemination on risks, the wider impacts of disasters on the sector have not necessarily resulted in reduced business for tourism operators. For example, in Grenada, by December 2005, just over a year after Hurricane Ivan, the tourism sector had almost completely recovered, with 96 percent of hotel rooms reopened (UNDESA, 2010

UNDESA (United Nations Department of Economic and Social Affairs). 2010.,Trends in Sustainable Development. Small Islands Developing States (SIDS)., United Nations publication., New York,USA.. .
).
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