South West Indian Ocean Risk Assessment and Financing Initiative (SWIO-RAFI) Summary Report

Executive Summary

The South West Indian Ocean (SWIO) Island States are highly exposed to adverse natural events. On average, 13 tropical cyclones with wind speeds exceeding 63 km/h form in the SWIO basin every year. The tropical cyclones that form in this area can affect the SWIO Island States, resulting in affected population and financial losses, caused by high winds, flooding and storm surges. These countries are also exposed to flooding from non-tropical cyclone induced precipitation (e.g. monsoons), earthquakes, tsunamis, and other hazards such as drought, volcanic activity, and landslides. As a result, SWIO Island States face high levels of physical and financial risk exposure.

The review of historical catastrophic events in the SWIO region revealed that during the 50-year period of 1964– 2014, the Comoros, Madagascar, Mauritius and the Seychelles experienced a total of 100 significant adverse natural events of which 94 were related to hydro-meteorological phenomena (75 storms; 11 floods; and 8 drought events). This figure does not include low-intensity, high frequency hydro-meteorological events that, with increasing frequency, affect the SWIO Island States. The death toll of weather-related disasters during the period was 2,896 people (or 99.8 percent of all lives lost to major natural disasters including earthquakes and other natural hazards), and the affected population was estimated at 14.4 million. In addition, physical damages resulting from weather-related events were estimated at USD 3.1 billion.

The Indian Ocean Commission (IOC) requested technical and financial support from the WBG and other international development organizations for its efforts to improve the understanding of the region’s disaster risks, as input for the future implementation of disaster risk financing mechanisms. A key expected outcome of the IOC request was the preparation of countries’ disaster risk profiles for tropical cyclone, flood triggered by non-tropical cyclone rainfall, and earthquake hazards; as well as an initial evaluation of their potential fiscal and financial impacts under different scenarios of frequency, intensity, and magnitude.

In response to the IOC’s request, and informed by the successful implementation of the similar initiatives in the Caribbean and the Pacific regions (i.e. CCRIF; and PCRAFI, respectively), the WBG engaged in the implementation of the South West Indian Ocean Catastrophe Risk Assessment and Financing Initiative (SWIO-RAFI). The main goal of SWIO-RAFI was to provide a solid basis for, and to promote the implementation of cost-effective disaster risk financing mechanisms that incorporate an improved understanding of the SWIO Island States’ risk profiles, potential contingent liabilities, and their fiscal situations.

Ongoing disaster risk reduction and resilience building dialogues with the IOC were informed by the outcomes of the SWIO-RAFI initiative and lessons-learned from the CCRIF and PCRAFI. Working with the regional organization, and SWIO governments, this report seeks to substantially contribute to the dialogue and build an improved understanding of regional and national disaster risks, through providing technical underpinnings to the findings and recommendations, as presented in this summary report.