ECLAC’S PRESENTATIONS ADPC-WB Workshop - August 13-15, 2002 / Bangkok, Thailand 1: Presentation of ECLAC Methodology 1: Presentation of ECLAC Methodology 2: Sectoral Revision of Assessment in ECLAC Methodology 2: Sectoral Revision of Assessment in ECLAC Methodology 3: Country experiences: World Bank’s experience in India and Turkey 3: Country experiences: World Bank’s experience in India and Turkey 4: Global overview/Macro Effects of a Disaster in ECLAC Methodology 4: Global overview/Macro Effects of a Disaster in ECLAC Methodology

Presentation of the ECLAC methodology General considerations General considerations Valuation as a tool for reconstruction, mitigation and planning resilience Valuation as a tool for reconstruction, mitigation and planning resilience Usefulness of historical records Usefulness of historical records Methodological considerations Methodological considerations Definitions: risk, vulnerability, mitigation recurrence, etc. Definitions: risk, vulnerability, mitigation recurrence, etc. Basic concepts: direct (assets/capital), indirect (flows/economical, financial, fiscal) Basic concepts: direct (assets/capital), indirect (flows/economical, financial, fiscal) Valuation criteria Valuation criteria Sources of information: remote, statistical, direct observation, surveys, second hand, etc. Sources of information: remote, statistical, direct observation, surveys, second hand, etc.

WHAT IS IT: A tool for the socio-economic and environmental assessment of disasters A tool for the socio-economic and environmental assessment of disasters Multi-sectoral and multidisciplinary damage evaluation and quantification method for disaster affected sectors Multi-sectoral and multidisciplinary damage evaluation and quantification method for disaster affected sectors Standard sectoral procedures that allows comparability of results Standard sectoral procedures that allows comparability of results Instrument for the decision making process and for policy formulation as it identifies more severely affected sectors, geographical areas and vulnerable groups Instrument for the decision making process and for policy formulation as it identifies more severely affected sectors, geographical areas and vulnerable groups Conceptual improvement for measuring aspects not included in national accounting and assessing specific vulnerability (of social groups, such as women and the environment) Conceptual improvement for measuring aspects not included in national accounting and assessing specific vulnerability (of social groups, such as women and the environment)

WHAT IT DOES: Allows projecting future performance of the affected economy in the short and medium term, and implement the necessary corrective economic policy measures Allows projecting future performance of the affected economy in the short and medium term, and implement the necessary corrective economic policy measures Allows to determine the State’s capacity to face reconstruction tasks and determine needs for cooperation and international financing Allows to determine the State’s capacity to face reconstruction tasks and determine needs for cooperation and international financing Facilitates training in damage valuation and formulation of mitigation strategies Facilitates training in damage valuation and formulation of mitigation strategies Involves affected population with relevant authorities and aid providers Involves affected population with relevant authorities and aid providers Puts in evidence the systemic character of the development process and the interaction among sectors and stakeholders Puts in evidence the systemic character of the development process and the interaction among sectors and stakeholders

Social sectors Infrastructure and services Productive sectors Environment Dynamic interaction between sectors and activities with natural occurrences: Vulnerability and mitigation Mudslides and silt deposits Landslips, avalanches and erosion Groundswells, sea surges and high waves Flooding and rain

Vicious circle: Man, Environment, Disasters Human actions progressively deteriorate the environment Human actions progressively deteriorate the environment Natural phenomena affect the environment (positively / negatively) Natural phenomena affect the environment (positively / negatively) Impact of disasters tends to increase Impact of disasters tends to increase NATURALPHENOMENA HUMANACTIONS ENVIRONMENT

* SOCIAL STABILITY SECURITY (Reduced Vulnerability) GOOD GOVERNANCE ECONOMIC RECOVERY BREAKING THE CYCLE OF CONFLICT AND RESUMING THE PATH OF DEVELOPMENT The World Bank’s Conflict Prevention and Reconstruction Team, SDV

SEQUENCE OF EFFECTS PHENOMENON: Characteristics (physical description, typology and context) EFFECTS:directindirect LINKAGES Menace Vulnerability Risk Impact/Benefit of reconstruction (global, by sector)  Reduce vulnerability  Synergies for reconstruction: “appropriation” of risk by affected/menaced population (community, social group, sector, country)

SOME DEFINITIONS IN DISASTERS PREVENTION PREVENTION the “before” actions the “before” actions Actions (programmes, projects) with the objective of anticipating and counteract the negative consequence an event may have (hydro-meteorological, climatic, seismic, tectonic, geological, even technological, industrial or “complex” Actions (programmes, projects) with the objective of anticipating and counteract the negative consequence an event may have (hydro-meteorological, climatic, seismic, tectonic, geological, even technological, industrial or “complex” It implies namely operational and organisation actions, training of potentially affected groups and population to face a disaster’s consequences. It implies namely operational and organisation actions, training of potentially affected groups and population to face a disaster’s consequences.

SOME DEFINITIONS IN DISASTERS (2) MITIGATION MITIGATION encompasses actions “before”, “during” and “after” encompasses actions “before”, “during” and “after” Actions (programmes, project) with the objective of counteracting (reducing the negative impact) of an occurrence. Actions (programmes, project) with the objective of counteracting (reducing the negative impact) of an occurrence. Includes allocation of resources to reinforce structures, redesign or alter existing elements to reduce vulnerability in addition to training and organisation (including at the community level) Includes allocation of resources to reinforce structures, redesign or alter existing elements to reduce vulnerability in addition to training and organisation (including at the community level)

SOME DEFINITIONS IN DISASTERS (3) VULNERABILITY VULNERABILITY calculation made on the basis or recurrence and severity of disastrous events calculation made on the basis or recurrence and severity of disastrous events Risk factors or exposure to danger of existing physical structures (buildings, houses, etc.) and basic infrastructure (lifelines, transportation and communications, etc.). Risk factors or exposure to danger of existing physical structures (buildings, houses, etc.) and basic infrastructure (lifelines, transportation and communications, etc.). Conditions of human settlements and localisation of productive activities (primary, industrial,l tertiary or services) and their linkage among them and with the environment. Conditions of human settlements and localisation of productive activities (primary, industrial,l tertiary or services) and their linkage among them and with the environment.

SOME DEFINITIONS IN DISASTERS (4) DISASTER REDUCTION DISASTER REDUCTION encompasses actions “before”, “during” and “after” encompasses actions “before”, “during” and “after” Actions (programmes, project) with the objective of reducing vulnerability and exposure to risk in the face of the interaction between human action and natural foreseeable or recurrent events. Actions (programmes, project) with the objective of reducing vulnerability and exposure to risk in the face of the interaction between human action and natural foreseeable or recurrent events. Implies the use (design and enforcement) of construction codes, land-use regulation, space planning, institutional arrangements and community involvement Implies the use (design and enforcement) of construction codes, land-use regulation, space planning, institutional arrangements and community involvement

SOME DEFINITIONS IN DISASTERS (5) RISK MANAGEMENT RISK MANAGEMENT (actions to be carried out “before” with consequences “during” and “after”) (actions to be carried out “before” with consequences “during” and “after”) Pro-active strategy (in contrast to re-active response) to reduce vulnerability and counteract risk factors Pro-active strategy (in contrast to re-active response) to reduce vulnerability and counteract risk factors Its objective is disaster reduction Its objective is disaster reduction Is not a sector action but a global set of actions encompassing all sectors, beginning with sound environmental management Is not a sector action but a global set of actions encompassing all sectors, beginning with sound environmental management Is not a conservation policy per-se but requires sustainability criteria both in terms of natural resources and human intervention. Is not a conservation policy per-se but requires sustainability criteria both in terms of natural resources and human intervention.

SOME DEFINITIONS IN DISASTERS (6) DISASTER MANAGEMENT DISASTER MANAGEMENT actions to be carried “during” and the immediate (short-term) “after” actions to be carried “during” and the immediate (short-term) “after” The response strategy (re-active strategy) to, after the occurrence of a disaster, intends to counteract its more immediate negative impact and prevent more severe effects in the short term. The response strategy (re-active strategy) to, after the occurrence of a disaster, intends to counteract its more immediate negative impact and prevent more severe effects in the short term. Includes emergency actions (search and rescue, immediate assistance, shelter, sanitary and health campaigns, rehabilitation of lifelines, assessment of emergency needs and first appraisal of reconstruction requirements. Includes emergency actions (search and rescue, immediate assistance, shelter, sanitary and health campaigns, rehabilitation of lifelines, assessment of emergency needs and first appraisal of reconstruction requirements.

SEQUENCE OF DISASTER VALUATION

Concepts Direct damages Impact on assets Impact on assets Infrastructure Infrastructure Capital Capital Stocks Stocks Occur immediately during or after the phenomenon that caused the disaster Occur immediately during or after the phenomenon that caused the disaster Indirect Damages Effects on flows Effects on flows Production Production Reduced income and increased expenses Reduced income and increased expenses Are perceived after the phenomenon, for a time- period that can last from weeks to months, till recuperation occurs Are perceived after the phenomenon, for a time- period that can last from weeks to months, till recuperation occurs

Measuring the damage “delta” or damage gap Pre-existing conditions (ex ante) Expected performance (without disaster) 3-5 years Disaster impact (ex post) 3-5 years The measure Of direct and indirect damages Upon the pre-existing situation (sector by sector baselines) is aggregated into the national accounts and determines the resulting disaster- caused scenario, as the gap over the expected performance prior to the event. Several scenarios may be outlined, based on the assumptions made for the reconstruction process

THE “PERVERSE EFFECT” OF DISASTERS ON GROSS CAPITAL FORMATION IN A SMALL ECONOMY Adapted from Mora, “El impacto de los desastres, aspectos sociales, polítifcos económicos, ambientales y su relación con el desarrollo de nuestros países (BID, 1999) * GROSS CAPITAL FORMATION TIME DEVELOPING COUNTRIES INDUSTRIALIZED COUNTRIES *DISASTER

THE EFFECT OF SUCCESSIVE DISASTERS ON CAPITAL FORMATION Adapted from Mora, “El impacto de los desastres, aspectos sociales, polítifcos económicos, ambientales y su relación con el desarrollo de nuestros países (BID, 1999) y su relación con el desarrollo de nuestros países (BID, 1999) * * * * TIME GROSS CAPITAL FORMATION DEVELOPING COUNTRIIES INDUSTRIALIZED COUNTRIES *DISASTER

Know the pre-existing situation Identify the core development factors of the economy Identify the core development factors of the economy Identify the main characteristics at the time of the disaster: face of the economic cycle, seasonal elements, indebtedness level, domestic savings, FDI flows, etc. Identify the main characteristics at the time of the disaster: face of the economic cycle, seasonal elements, indebtedness level, domestic savings, FDI flows, etc. Access the macroeconomic data bases from national authorities, academic analysts and/or consultants and advisors in the country Access the macroeconomic data bases from national authorities, academic analysts and/or consultants and advisors in the country Identify existing econometric models for the local economy Identify existing econometric models for the local economy Identify if input-output tables are available or determine weighing factors that indicate intersectoral linkages. Identify if input-output tables are available or determine weighing factors that indicate intersectoral linkages.

Acknowledge the expected or projected outcome in the absence of disaster Obtain from government, academics and/or advisors and private consultants the existing scenarios or short and medium term projections before the disaster Obtain from government, academics and/or advisors and private consultants the existing scenarios or short and medium term projections before the disaster Build a price table at current value for the disaster period with at least five year projections. There may have been more than one pre-disaster scenario for the main economic variables Build a price table at current value for the disaster period with at least five year projections. There may have been more than one pre-disaster scenario for the main economic variables Build a constant-value (real magnitude) series for the main variables (using the country’s base year, either in local currency or US dollars Build a constant-value (real magnitude) series for the main variables (using the country’s base year, either in local currency or US dollars Establish the rate of exchange that will be used for the valuation Establish the rate of exchange that will be used for the valuation

Determine the situation caused by the disaster Stemming from sector valuations assess the value- added changes expected for every sector in the short term and for a medium-term period to be agreed (3-5 years or more) Stemming from sector valuations assess the value- added changes expected for every sector in the short term and for a medium-term period to be agreed (3-5 years or more) Supported by input-output tables or sector weighing factors determine the projection of damages of one sector to the others Supported by input-output tables or sector weighing factors determine the projection of damages of one sector to the others A damage scenario is built (taking into account the measured losses at replacement value) : variations in the main economic gaps is highlighted: external sector, fiscal deficit, internal equilibrium (prices, exchange rate, etc.) A damage scenario is built (taking into account the measured losses at replacement value) : variations in the main economic gaps is highlighted: external sector, fiscal deficit, internal equilibrium (prices, exchange rate, etc.)

Future Scenarios 1 st. Scenario: damage assessment and event’s impact, without including reconstruction actions 1 st. Scenario: damage assessment and event’s impact, without including reconstruction actions Alternative reconstruction scenarios Alternative reconstruction scenarios Taking into account no longer the replacement but the reconstruction costs Taking into account no longer the replacement but the reconstruction costs Emerging reconstruction priorities, sector by sector Emerging reconstruction priorities, sector by sector The emerging reconstruction strategies in the immediate weeks after the disaster The emerging reconstruction strategies in the immediate weeks after the disaster The economy’s absorption capacity of foreign resources The economy’s absorption capacity of foreign resources The economy’s capacity to execute projects The economy’s capacity to execute projects The performance of key economic variables in the face of an increase or impending reorientation of resources for reconstruction: interest rates, indebtedness, inputs and production means availability (raw materials, capital goods, domestic saving, labour force, etc.) The performance of key economic variables in the face of an increase or impending reorientation of resources for reconstruction: interest rates, indebtedness, inputs and production means availability (raw materials, capital goods, domestic saving, labour force, etc.)

Sector by sector valuation methodology Social Sectors Social Sectors Housing Housing Health Health Education, culture, sports Education, culture, sports Infrastructure Infrastructure Transport and communications Transport and communications Energy Energy Water and sewerage Water and sewerage Productive sectors Productive sectors Goods: agriculture, industry Goods: agriculture, industry Services: commerce, tourism, etc. Services: commerce, tourism, etc. Global impact Global impact On the environment On the environment Gender perspective Gender perspective Employment and social conditions Employment and social conditions Macroeconomic assessment Macroeconomic assessment

Social Sectors Including subsectors and issues of special relevance: Food and nutritional conditions Food and nutritional conditions Differential impact on women Differential impact on women

Productive sectors 9. Agriculture, cattle raising and fishing 10. Industry, commerce and services 11. Tourism

Damages to agriculture, cattle raising and fishing Direct damages Repair or reconstruction costs of agriculture, cattle farming and fishing infrastructure, including tertiary level roads Repair or reconstruction costs of agriculture, cattle farming and fishing infrastructure, including tertiary level roads Damages or destruction of fishing fleet Damages or destruction of fishing fleet Damages or destruction of fish farming ponds and shrimp factories Damages or destruction of fish farming ponds and shrimp factories Agriculture production ready to be harvested Agriculture production ready to be harvested Stocked agricultural produce and grains Stocked agricultural produce and grains Losses in animal stock Losses in animal stock Indirect damages Indirect damages Reduced yields in future crops Reduced yields in future crops Not planting of future crops Not planting of future crops Reduced fishing Reduced fishing Loss of employment Loss of employment Differential impact on women Differential impact on women

Food and nutrition estimates of impact Prepare a basic foodstuff availability balance to identify food and nutritional deficits Prepare a basic foodstuff availability balance to identify food and nutritional deficits Identify the location and number of affected population Identify the location and number of affected population Indirect costs Indirect costs Food cost and temporary shelter for affected population deprived of food during migration process Food cost and temporary shelter for affected population deprived of food during migration process Determine the indirect cost of imported supply and food distribution campaigns to aboid malnutrition and migration Determine the indirect cost of imported supply and food distribution campaigns to aboid malnutrition and migration

Commerce, industry and services Direct damages Repair or reconstruction costs of infrastructure Repair or reconstruction costs of infrastructure Repair or replacement cost of equipment and machinery Repair or replacement cost of equipment and machinery Losses in finished production (stocks and inventories) Losses in finished production (stocks and inventories) Indirect damages Reduced production Reduced production Temporary employment losses Temporary employment losses Differential impact on women Differential impact on women

Manufacture Damages in Millions of US$ Direct Indirect Total Guarenas/Guatire industrial complex small manufacturing enterprises Damage in agro-industry … Damages in construction-related ones Totals

Commercial losses Damages in Millions of US$ Direct Indirect Total Damages to supermarkets Damages to medium-sized commerce Damages in small and micro businesses Totals

Damages to tourism Direct damages Repair or reconstruction costs of tourism infrastructure Repair or reconstruction costs of tourism infrastructure Repair or replacement cost of furniture and tourism equipment Repair or replacement cost of furniture and tourism equipment Damages to beaches and other tourist attractions Damages to beaches and other tourist attractions Indirect damages Temporary fall in hotel occupancy and income of enterprises Temporary fall in hotel occupancy and income of enterprises Negative effect in linked activities Negative effect in linked activities Cancelled future reservations and cost of promotion campaigns Cancelled future reservations and cost of promotion campaigns Unemployment Unemployment Differential impact on women Differential impact on women

Women and disasters Men and women share damage impact of disasters; nevertheless women face particular effects associated with sex differences Men and women share damage impact of disasters; nevertheless women face particular effects associated with sex differences Differences in gender roles require different apporaches in the face of reconstruction Differences in gender roles require different apporaches in the face of reconstruction

Disasters and women Estimates regularly made by ECLAC include damages to assets pertaining to women en each sector, as well as indirect losses of income in remunerated work Estimates regularly made by ECLAC include damages to assets pertaining to women en each sector, as well as indirect losses of income in remunerated work To this should be added other assets and non- formal activities, non-paid household chores performed at home, all of which are not included in the national accounts To this should be added other assets and non- formal activities, non-paid household chores performed at home, all of which are not included in the national accounts

Definitions Reproductive work: Reproductive work: Renewal of workforce (child care, education, etc.) Renewal of workforce (child care, education, etc.) Productive labour force availability (household care and cleaning, food preparation, water supply, personal care and attention, etc.) Productive labour force availability (household care and cleaning, food preparation, water supply, personal care and attention, etc.) Caring of labour force and population not participating in the workplace (ill, aged, incapacitated, etc.) Caring of labour force and population not participating in the workplace (ill, aged, incapacitated, etc.) Backyard economy (to supplement income and nutrition of the household): Backyard economy (to supplement income and nutrition of the household): Domestic bird and minor livestock raising Domestic bird and minor livestock raising Derivate foodstuff within the household (eggs, milk, etc.) Derivate foodstuff within the household (eggs, milk, etc.) Fruit yard Fruit yard Small subsistence lots and parcels Small subsistence lots and parcels

Direct damages Housing, furnishings, appliances lost, when women are heads of household Housing, furnishings, appliances lost, when women are heads of household Assets in formal sectors owned by women Assets in formal sectors owned by women Machinery and equipment of micro and small enterprises informally operated by women at home Machinery and equipment of micro and small enterprises informally operated by women at home “Backyard economy” assets (small species cattle, family lot, vegetable gardens and informally raised crops) “Backyard economy” assets (small species cattle, family lot, vegetable gardens and informally raised crops) Production stocks of both formal and informal activities Production stocks of both formal and informal activities

Indirect damges or losses Temporary loss of remunerated work outside the home Temporary loss of remunerated work outside the home Production losses of micro and small enterprises Production losses of micro and small enterprises Same for household operated businesses Same for household operated businesses Production losses of “backyard economy” Production losses of “backyard economy” Increase in “reproductive” associated tasks and work Increase in “reproductive” associated tasks and work Other losses Other losses

FUTURE DEVELOPMENTS VULNERABILITY AND DEVELOPMENT (1) Subject of analysis: relation of size, development and vulnerability: Subject of analysis: relation of size, development and vulnerability: “resilience” (strengthening and preparedness) in the face of: “resilience” (strengthening and preparedness) in the face of: shocks (internal, environmental, climatic, external) shocks (internal, environmental, climatic, external) Dependency and diversification Dependency and diversification Integration and producitve/competitive linkages Integration and producitve/competitive linkages Analytical-mathematical formulation Analytical-mathematical formulation Global (transborder, regional) impact of disaster Global (transborder, regional) impact of disaster Economic, social, environmental Economic, social, environmental Effects on the donor/relief community Effects on the donor/relief community Effects on private sector (transnational corporations, FDI, financial markets, etc.) Effects on private sector (transnational corporations, FDI, financial markets, etc.)

FUTURE DEVELOPMENTS VULNERABILITY AND DEVELOPMENT (2) Lessons from Mitch, droughts and earthquakes in 2001, climatic variability and 30 years of disaster valuation: “revisit” and appraise reconstruction process Lessons from Mitch, droughts and earthquakes in 2001, climatic variability and 30 years of disaster valuation: “revisit” and appraise reconstruction process Broadening methodology to social and environmental valuation Broadening methodology to social and environmental valuation Enhance current methodology with consideration of prospective alternative scenarios and macroeconomic models Enhance current methodology with consideration of prospective alternative scenarios and macroeconomic models Train national authorities in the areas of economics and planning Train national authorities in the areas of economics and planning Promote mitigation and risk managements policies beyond prevention and response Promote mitigation and risk managements policies beyond prevention and response

Internal policies: Include vulnerability reduction as an objective of development plans alongside goals of: Competitive growth Competitive growth Equitable development Equitable development Sustainable and sustained development Sustainable and sustained development Social participation Social participation External policies: Introduce risk management as part of the regional international agenda, alongside: External competitive insertion External competitive insertion Benefitting from the globalization process Benefitting from the globalization process Inclusive regional insertion Inclusive regional insertion Sectoral components: Monitoring, analysis and climate forecasting, including forest fires Monitoring, analysis and climate forecasting, including forest fires Contingency plans in key sectors, for example: Contingency plans in key sectors, for example: Agriculture, cattle raising, Agriculture, cattle raising, rural poverty, rural poverty, energy and baselines energy and baselines Water and health Water and health Interconnected systems Interconnected systems Regulation of basic services with sponsorship of private enterprise Regulation of basic services with sponsorship of private enterprise Focalized plans for vulnerable groups, including employment, food availability and nutrition Focalized plans for vulnerable groups, including employment, food availability and nutrition Education to reduce vulnerability Education to reduce vulnerability Diagnosis and monitoring of vulnerability at the local level Diagnosis and monitoring of vulnerability at the local level Proposed courses of action Restore economic and social fabric Restore and strenghten productive linkages (upstream/downstream) Reduce internal / external vulnerability

Disasters, conflict and crisis management How to approach the different interventions required: conceptual aspects, definition problems and purpose of the interventions How to approach the different interventions required: conceptual aspects, definition problems and purpose of the interventions Are they different sides of the same coin: crisis managements associated with disasters and / or conflict? Conceptual quagmire Are they different sides of the same coin: crisis managements associated with disasters and / or conflict? Conceptual quagmire Methodological problems: needs assessments vs. Causal analysis Methodological problems: needs assessments vs. Causal analysis Operational problems: setting priorities and differentiating emergency from urgency: simultaneity and sequencing Operational problems: setting priorities and differentiating emergency from urgency: simultaneity and sequencing Policy problems: positive vs. negative intervention; resource allocation vs. policy change promotion Policy problems: positive vs. negative intervention; resource allocation vs. policy change promotion

Comparative analysis of disasters and post-conflict situations

Comparative analysis of disasters and post-conflict situations (cont.)