ADB Report Highlights Growing Risk of Natural Disaster in Asia

On September 17, 2018, Typhoon Mangkhut, the strongest tropical storm ever to hit Hong Kong, came ashore with gusts recorded up to 256 km per hour, knocking over 47,000 trees, causing skyscrapers to sway and blocking roads and blowing out the glass curtain walls of the Harbour Grand Kowloon. Insurance claims amounted to HK$7.3 billion (US$930 million). Before it got to Hong Kong, as the storm made its way across the Pacific it killed 134 people and later led to widespread flooding in China.

Not one person died in Hong Kong, however, despite the wind damage and gigantic waves that licked up the sides of coastal buildings. And therein lies a story, one told by the latest edition of the Asian Development Bank’s annual flagship Asian Development Outlook 2019, released on April 3, which focuses on disaster remediation and which points out that four out of every five people affected by natural hazards globally live in Asia, highlighting the need for better disaster resilience.

From 2000 to 2018, the ADB found, developing Asia was home to 84 percent of the 206 million people affected by disasters globally on average each year. With nearly 38,000 disaster fatalities annually in that period, the region accounted for almost 55 percent of 60,000 such fatalities worldwide, and it suffered 26 percent of the US$128 billion in economic damage.

The report focuses on disasters that emerge from natural hazards, including severe weather events, geophysical disturbances, and epidemics. They can occur suddenly with little or no warning, or they can build slowly over the span of days, weeks, months, or years.

Hong Kong, like almost no other city in Asia, is built to withstand natural disasters and fortuitously doesn’t exist in an earthquake zone. But for much of this hemisphere, poor and marginalized households, small firms and small and remote countries such as the Pacific island nations typically suffer the most from disasters. Indonesia and the Philippines are uniquely vulnerable to volcanic action and earthquakes.

Beyond that rapidly expanding coastal megacities, such as Manila, Jakarta and Bangkok, for example, create greater exposure to natural hazards. “As the frequency and intensity of extreme weather events worsen because of climate change and associated sea level rise, coastal areas and island states across Asia face increasingly dire threats,” the report notes.

The ADB has increasingly directed its efforts to the damage from climate change and has sought to move the needle in Asian countries towards recognition of the threat. Disaster resilience is a part of that mission. In 2018, the ADB made commitments of new loans and grants amounting to US$21.6 billion in mitigation efforts.

Nonetheless, “rapid socioeconomic development is converging with worsening threats from natural hazards to pose unprecedented risk from catastrophes in developing Asia,” the ADB said in the report. “While the direct, immediate impacts of disasters tend to be local and short term, new evidence shows how these effects can spill over to other places and last for a lifetime. Suitable policy interventions are required to keep disaster losses from spiraling into the future and across the region.”

The Philippines, also battered by Mangkhut, lost 126 of the 134 people killed by the typhoon. And at that, it was lucky this time. Typhoon Haiyan, known as Yolanda, killed 6,300 people in 2013. Pedro, known as Bopha in the Philippines, killed 1,300. Since 2010, typhoons have done US$6.85 billion in damage to the Philippines, which ranks as the third-most-vulnerable country in the world by the United Nations to natural disaster. The two most vulnerable are Vanuatu and Bangladesh.

The ADB report urges countries to reinforce disaster risk planning, with climate-friendly and disaster-resilient infrastructure particularly cost-effective in reducing losses. This could include better water resource management to deal with droughts, earthquake-safe community buildings, and rebuilding mangrove forests to mitigate coastal erosion.

The region would also benefit if governments routinely set aside funds to be mobilized in case of disaster as well as increased use of credit and insurance, particularly through risk transfer products and re-insurance, to allow for a broader pooling of risk. And although climate change is spurring more natural hazards and rapid urbanization is increasing exposure to hazards, only around 8 percent of Asia’s catastrophe losses since 1980 have been covered by insurance. Access to credit, insurance, and remittances remains sparse and uneven, limiting the coping strategies available to households affected by disasters. Immediate humanitarian response could be better coordinated with subsequent interventions for long-term recovery.

National efforts should be complemented by action at the community level since investments in the likes of community waste management can build resilience while the community is the first port of call for support and local knowledge after disasters strike.

The report notes that rapid rebuilding often takes precedence after disasters, but that swift recovery should be considered alongside other objectives, including strengthening resilience to future hazards, considering the needs of the vulnerable segments of society, and restoring the economic and social dynamism of the affected area. Key to this is collaboration among central and local governments, NGOs and the community in disaster response as seen following the earthquake in Nepal and Cyclone Pam in Vanuatu, both in 2015.

New evidence on the economic impact of tropical storms in the Philippines shows that each of these events reduced local economic activity in that year by 1.7 percent on average but by as much as 23 percent after the most severe storms, the report states, with more extreme events having much larger impacts.

Cyclone Pam in 2015—the second most intense tropical cyclone ever recorded in the South Pacific—caused damage in Vanuatu equal to 64 percent of annual GDP. Events that fall short of catastrophic typically affect economic activity for a year or less, allowing households that temporarily migrate away in the aftermath of a disaster to return to their land and livelihoods.

Case studies of flooding in Indian cities show that, in the absence of social protection, disaster-hit families deplete their savings or borrow at high interest rates from informal sources, pushing them into indebtedness and poverty traps. Recent research reveals that disasters can affect victims for decades as reduced household spending on food, medicine, and education, for example, stunts a child’s potential well into adulthood.

Making things worse, the effects of natural disasters can spread and link up with epidemics, conflict, and other risks. East, Southeast, and South Asia accounted for over 60 percent of the estimated 19 million people displaced by disasters in 2017—some briefly, others for much longer. The number of internal climate migrants is projected to increase rapidly, which may also facilitate the spread of disease and even spark social disorder in urban areas, as suggested by new evidence on flood-induced migration. Developing Asia is estimated to need US$26 trillion in infrastructure investment from 2016 to 2030, or US$1.7 trillion per year.

“Planning for and investing in climate-friendly and disaster-resilient infrastructure from the start can help avoid locking in further exposure to disaster risk and is a particularly cost-effective way to reduce future losses from disasters,” the report notes. “Spending on prevention needs to catch up with spending on response. Globally, governments in developing countries receive seven times more assistance for responding to disasters after they occur than for preparing in advance for rapid recovery and, where possible, taking measures to keep hazards from developing into disasters.