Natural disasters cost $520 billion a year, World Bank says

Global natural disasters cost $520 billion of consumption loss annually, 60 percent larger than asset losses that are commonly reported, the World Bank said in a report.

The estimate is based on the impact of disasters such as floods, windstorms, earthquakes, and tsunamis on people’s well-being, measured by the decline in their consumption, Stephane Hallegatte, one of the authors of the report which was released on Wednesday, said in an email.

“The design of disaster risk management should, then, not rely only on asset losses,” the World Bank said. “Targeting poorer people with disaster risk reduction interventions — such as dikes and drainage systems — would generate lower gains in avoided asset losses but larger gains in well-being.”

Asia Pacific is the world’s most exposed region to natural disasters, accounting for about 40 percent of the global tally, said Hallegatte, who is also senior economist at the lender’s climate change group. The region has high population densities and suffers from relatively high frequency of typhoons, earthquakes and tsunamis such as the one that led to the 2011 meltdown of the Fukushima nuclear reactors, he said.

About BloombergNEF

BloombergNEF (BNEF) is a strategic research provider covering global commodity markets and the disruptive technologies driving the transition to a low-carbon economy. Our expert coverage assesses pathways for the power, transport, industry, buildings and agriculture sectors to adapt to the energy transition. We help commodity trading, corporate strategy, finance and policy professionals navigate change and generate opportunities.
 
Sign up for our free monthly newsletter →

Want to learn how we help our clients put it all together? Contact us