Attachments
1. Introduction
Each country decides the scale of its investment in flood control based on various factors, such as the scale and frequency of flood disasters, the assets accumulated in areas at risk, and the level of community concern about potential disasters. The experience of selected countries shows that governments allocate budgets for flood control according to historical records of the impact of the most severe disaster on the national economy. Countries can turn a flood disaster from a crisis into an opportunity to expand investment in flood control. The Japanese experience over the last one and half centuries shows that the country has increased flood control budgets every time it has suffered from a major disaster. Experience also shows that budgets for flood control have a positive correlation with urbanization and gross domestic product (GDP) per capita. Based on this experience, investment for flood control in the Philippines is estimated at USD 33-61 billion until 2030. These analyses are useful for estimating the requirements for infrastructure investment for flood control in Asian countries.
2. Relationship between flood control investment and flood damage
Each country decides the scale of its investment in flood control according to the impact of the most severe disaster on the national economy in the past, rather than on the average level of flood damage experienced over time (Table 1). Mega-disasters often become triggers to expand investment in flood control. Japan has repeatedly experienced enormous flood disasters caused by typhoons and heavy rainfall since the Second World War. The economic damage caused accounted for over 10% of national income in 1947 and 1953 for example, and as a result, the Japanese government invested 0.6-1% of GDP for flood control until the mid-1960s to mitigate flood damage. The Netherlands spent 1% of GDP on flood control in 1960 following the catastrophic North Sea flood of 1953.
This disaster caused 1,853 casualties and economic damage of some 0.7 billion Euros. Currently, flood damage in the Netherlands and Japan has decreased to 0.02% and 0.06% of GDP, respectively. Yet, these two countries are continuing to make high level of investments of some 0.2% of GDP for flood control. The Netherlands is also increasing its budget for flood control to prepare for potential disasters caused by climate change.
The Philippines, China, UK, and Indonesia have increased their flood control budgets in the past several years as a reaction to the enormous damage from recent disasters. The scale of their investments is also dependent on the magnitude of these disasters. The Philippines and China allocate some 0.4% of GDP, and the maximum economic damage experienced has been 1.3% and 3.5% of GDP, respectively. The UK and Indonesia allocate 0.2 % and 0.06 % of GDP respectively, and the maximum damage experienced has been some 0.2% of GDP. The flood control budget of US Army of Corp Engineers accounts for some 0.01% of GDP. This may seem a low level of investment considering the economic damage of 1% of GDP from Hurricane Katrina in 2005, but it is because only the US federal government budget figures are available; state government budgets are not included.