Building resilience: Understanding and managing risk to the housing sector in the Caribbean
The Caribbean region is highly susceptible to a variety of natural hazards that can cause widespread damage to infrastructure and property, as well as significant human and financial losses for individuals and businesses as they recover from disruptions.
Following catastrophic events, recovery efforts that are delivered rapidly, but also with a dedication to inclusion, can more effectively alleviate social and economic burdens and facilitate a quicker return to normalcy.
After a disaster, the housing sector of Caribbean nations often bears the brunt of financial impacts relative to other sectors, as seen by the $50 million of damages and losses to housing caused by hurricanes Maria and Irma in 2017 (37 percent of the total), the $110 million caused by the eruption of La Soufrière in 2021 (70 percent) or the $815 million in Haiti after the 2021 earthquake (50 percent). The vulnerabilities of the housing sector are compounded by rapid and often unplanned urbanization, which is reshaping land and housing markets across the region. In addition, the supply of quality, affordable housing has failed to keep pace with the increasing demand driven by migration from the country to urban areas. Consequently, many households must resort to substandard housing, heightening their vulnerability to natural hazards.
As an example, in the Dominican Republic, 82 percent of the population lives in urban areas—a figure projected to rise to 92 percent by 2050— and 36 percent of urban dwellers inhabit structures vulnerable to climate and disaster risks.
Addressing this issue necessitates comprehensive reforms in regional housing policies, where the effective design and enforcement of building codes assume a pivotal role in mitigating disaster risks. Adherence to standards for safe construction and site selection also facilitates a transition from disaster management to risk reduction. Thus, regulatory efforts can help countries build back better before an extreme event occurs. Coordinating this push with property insurance mutually reinforces the process, enhances risk reduction, and lays the groundwork for faster recovery across the Caribbean’s built environment.
In line with these challenges, the Global Facility for Disaster Reduction and Recovery (GFDRR) adopted several initiatives that focus on improving the resilience of the housing stock in the Caribbean. The main objectives are (i) to assist governments in conducting comprehensive analyses of housing stock and its vulnerabilities, of urbanization, and of building regulation capacity to better understand and address the prevailing conditions; and (ii) to strengthen the financial and physical resilience of the housing sector, ensuring that measures for risk financing and physical risk reduction are mutually reinforcing and complementary.
These efforts have been advanced by key development partners such as the European Union and Canada through the Caribbean Regional Resilience Building Facility (CRRBF) and the Canada-Caribbean Resilience Facility (CRF), respectively, who have displayed their commitment to disaster risk reduction by supporting these programs.
Understanding vulnerabilities
One CRRBF initiative, Strengthening Disaster and Climate Change Resilience in the Housing Sector in the Dominican Republic, is a notable example of advancements in the realm of physical resilience. Through this technical assistance, a team worked with the Ministry of Housing and the National Housing Fund to improve institutional capacity for risk-informed housing policy design and enhance institutional understanding of housing guarantee and insurance instruments. The advancements made then informed the design and implementation of the World Bank-financed Support to the National Housing Program Project. This ongoing project aims to integrate resilience into the national housing stock, enhance preparedness for post-disaster housing reconstruction, and foster improved dialogue among stakeholders within the Dominican Republic’s housing sector.
Another technical assistance effort on the topic of vulnerabilities in the housing sector was the Resilient Housing and Affordability Assessments project. GFDRR and World Bank teams provided support to the governments of Saint Vincent and the Grenadines, the Dominican Republic, and Saint Lucia through in-depth policy dialogue which led to the development of rapid housing sector assessments as well as the subsequent integration of resilient housing policy topics into the governments’ agendas. In the Dominican Republic, for example, the assessment advanced policy dialogue on housing sector interventions and critically, helped deliver a US$100 million investment from the government in improving housing affordability for vulnerable households. While in Saint Lucia, the assessment presented the demand and supply issues facing the sector, providing the government with up-to-date information that can support the design of more targeted measures.
Regional impacts
Another project was the Caribbean Physical and Financial Resilience Building Program, which was focused on Dominica, but also had activities in five other CARICOM countries. Accomplishments included the development of a country disaster risk profile for Dominica, and extended to the creation of an asset inventory associated with the World Bank-financed Housing Recovery Project (HRP). The inventory allows concerned actors to better model risks to Dominica and devise appropriate mitigation instruments. In addition, capacity-building initiatives targeted public and private sector building professionals through a Training of Trainers program. The program covered the implementation of the Organization of Eastern Caribbean States’ building code, cost-benefit analysis of retrofitting options, and public outreach and risk communication. These endeavors helped enhance resilience and mitigate risks across the Caribbean region by supporting the interpretation and implementation of the building codes that ensure structures are built to more resilient standards.
Support to the HRP was further complemented by additional technical assistance provided under the CRF Program. Implementation support contributed to the resolution of delays and meant the HRP achieved significant progress in reconstruction. In part due to assistance through the CRF Program, project management capacity was improved within the implementing unit, the resilient design of houses was ensured, assessments were conducted to better understand how affordability and resilience should inform design, and project planning and engineering capacities were bolstered. The HRP is currently making good progress. The Government of Dominica has so far completed 75 resilient houses, with an additional 200 houses currently under construction.
Furthermore, in Grenada, the CRF conducted a Sectoral Recovery Capacity Assessment focused on evaluating the housing sector’s ability to plan, implement and monitor resilient and inclusive projects. The analysis highlighted the need to enhance capacity levels by screening projects for climate resilience, promoting homeowner retrofitting, and strengthening the generation, management and use of risk data.
The efforts to bolster the resilience of the Caribbean housing sector in the face of natural disasters have made significant strides. Initiatives led by GFDRR and supported by partners such as the European Union and Canada have facilitated policy dialogue, deepened financial resilience, and enhanced physical risk reduction across the region. Despite these improvements, more needs to be done to put the Caribbean more firmly on the path toward comprehensive climate resilience. The EU Resilient Caribbean Program (EUReCa) intends to continue this effort by strengthening local capacities to design and implement risk informed investments, enhance emergency preparedness and response measures, and elaborate disaster risk financing strategies.