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Reducing 'Preventable' Costs of Natural Disasters Vital for Developing Countries

News and Press Release
Originally published
WASHINGTON, February 2, 2000 -- An international partnership designed to reduce the human and economic costs of natural disasters in the developing world will be launched here tomorrow by the World Bank and an international coalition of governments, international organizations, private insurance companies, universities, and non-governmental organizations.

The aim of the ProVention Consortium, as the partnership will be known, will be to equip developing countries with the means to better cope with natural disasters such as earthquakes, hurricanes and floods, and reduce the loss of life and destruction they cause.

In 1998, natural disasters killed more than 50,000 people and destroyed $65 billion worth of property and infrastructure. Some 95 percent of disaster-related deaths occurred in developing countries, where the poorest of the poor are the worst affected. The World Bank has lent more than $19 billion for post-disaster reconstruction over the last 20 years, often more than once to the same country after successive disasters.

"For too long, the international community has picked up the pieces after disaster has struck. The ProVention Consortium will help poor countries anticipate natural catastrophes so that when they do strike, as they inevitably will, there will be less suffering, destruction and disruption," said James D. Wolfensohn, President of the World Bank Group. "Today, the poor in many developing countries are far too vulnerable to natural disasters, as watersheds are deforested, buildings are substandard, and settlements established at unsafe locations. The Consortium seeks to reverse this trend."

The main objectives of the consortium are to:

  • Promote safety by raising the awareness of disaster-related risks among governments and communities so they can devise effective preventive measures;
  • Support public policies that reduce the risk of natural and technological disasters in developing countries by, for example, the integration of prevention and mitigation mechanisms in development plans, the adoption of improved building codes, and more effective management of both land use and emergency response agencies;
  • Develop governments' ability to anticipate, and respond effectively, to disasters when they strike through the use of early warning systems and civil defense.
"The consortium marks a shift from fatalism to prevention, from response to preparation, from relief to a strategy of risk reduction and risk transfer," said Alcira Kreimer, Manager of the World Bank's Disaster Management Facility and principal architect of the consortium. "Disasters will still occur but if prevention and mitigation are taken seriously the massive human and economic costs we have seen in recent years are not inevitable."

Three principles will guide the consortium:

  • Poverty and vulnerability are linked. As poor people are especially vulnerable to disasters, the consortium will assess the links between poverty and disasters as a first step to developing ways to increase protection.
  • Environmental protection is key. The consortium will work to protect natural resources such as forests, coastal mangroves, and coral reefs that can protect human settlements from the impact of cyclones and other weather-related disasters.
  • Risks can be shared. Because risk insurance is not available to most people in the developing world, the consortium will explore ways of providing low-income groups with insurance cover, safety nets and other mechanisms that reduce individual risk by spreading it wider.
The consortium will promote examples of "best practice" such as a recent World Bank $505 million reconstruction loan to Turkey that included measures to update and enforce building codes. Poor quality construction was responsible for many of the lives lost during the Marmara earthquake of last August. The reconstruction program will introduce better planning for land-use, and requires compulsory insurance for housing. Emergency response management will also be upgraded.

Turkey's campaign to reduce its exposure to risk is also reflected in other developing countries.

In Mexico, for example, where natural disasters since 1980 have claimed 10,000 lives and cost $6.5 billion, the World Bank is working with the government to improve preparedness and reduce the impact of disaster. This includes support for the government's Fund for Natural Disasters (FONDEN), as well as efforts to finance and transfer disaster risks to the private sector, in order to reduce the need to draw on government budgets to meet reconstruction needs.

In Central America, the World Bank, the Inter-American Development Bank and the Japanese government are assisting six governments in assessing disaster risks, setting up emergency warning and response systems, improving building codes and their enforcement, and in carrying out studies to identify environmental measures that would reduce the impact of natural disasters. In Nicaragua, the World Bank is working to help farmers protect themselves from disaster losses by developing rainfall-indexed crop insurance derivatives to be sold on private capital markets.

In the small states of the Caribbean, the Bank is supporting efforts to protect power systems, roads and other vital services, improve emergency management, and to increase the involvement of the private insurance industry in sharing disaster-related risks.

The active engagement of the insurance industry is vital in order to seize the opportunities offered by the increased interest among vulnerable countries in managing their risks more effectively.

Community organizations and local groups are also key players in reducing risk. Village-level committees played a major role in the reconstruction program after the earthquake in Maharashtra, India, in 1998.

"This powerful coalition brings together policy-makers and the scientific community, international organizations and their national counterparts, donors and victims," said Peter Walker, Director of Disaster Policy at the International Federation of Red Cross and Red Crescent Societiesone of the principal members of the consortium. "This broad participation increases our chances of changing the way we approach disasters and their management."

The World Bank's partners in the consortium include the Pan-American Health Organization, the UN Development Program (UNDP), the International Federation of the Red Cross and Red Crescent Societies, the Office for the Coordination of Humanitarian Affairs of the UN, the World Meteorological Organization, the UN Environment Program, the World Conservation Union (IUCN), the Inter-American, Asian, and African Development Banks, the US Federal Emergency Management Agency (FEMA), the Organization of American States, the Land Planning Agency and the Ministry of Construction of Japan, the International Institute for Applied Systems Analysis, the governments of Norway, Saint Lucia, Mexico, and Turkey, the Wharton School of the University of Pennsylvania, Virginia Polytechnic Institute and State University (Virginia Tech), the Federal Institute of Technology, and others.

To learn more about the ProVention Consortium and the World Bank's work on disaster relief more generally, visit our Disaster Management Facility website: www.worldbank.org/dmf

To learn more about the ProVention Consortium, visit the ProVention website: www.worldbank.org/provention

Contact Person:

Phil Hay (202) 473-1796

Miriam Razaq (202) 458-2931

Cynthia Case McMahon (TV/Radio) (202) 473-2243