Fiscal Resilience to Natural Disasters : Lessons from Country Experiences
Large-scale catastrophic and smaller recurrent disasters generate considerable economic losses. Over the past thirty years, damages from major disasters have increased significantly. In the last ten years alone, both high-income and fast-growing mi...
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| Language: | English |
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OECD: Paris
2019
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| Online Access: | http://documents.worldbank.org/curated/en/427321567493271740/Fiscal-Resilience-to-Natural-Disasters-Lessons-from-Country-Experiences http://hdl.handle.net/10986/32341 |
| Summary: | Large-scale catastrophic and smaller
recurrent disasters generate considerable economic losses.
Over the past thirty years, damages from major disasters
have increased significantly. In the last ten years alone,
both high-income and fast-growing middle-income economies
have experienced an estimated 1.2 trillion US dollars in
economic costs from disruptive shocks due to hazards such as
storms or floods. The costs of disasters are often largely
shouldered by governments, particularly where insurance
coverage for these costs is limited. Often governments are
not only responsible for the costs related to restoring
public assets and services, but are also asked to provide
financing for other explicit and implicit commitments made
prior to a disaster. The costs that disasters impose on
governments, and ultimately on taxpayers should be
considered contingent liabilities or, when disasters lead to
reductions in public revenues, contingent revenue losses.
These expenses and revenue losses arise only if an uncertain
event, such as a disaster, actually happens.
Disaster-related contingent liabilities are one type of
government contingent liability. This report presents the
findings of a comparative study that assesses how
effectively governments manage disaster-related contingent
liabilities, and the potential fiscal risks arising from
them, within public finance frameworks. The report documents
and compares the policies and practices of a set of nine
selected middle- and high-income economies focusing on their
response to and plans for disasters from a public financial
perspective. Economies were selected on the basis of their
exposure to and regular experience of natural disasters, and
with the aim of including economies of different sizes and
fiscal capacity. Part 1 of the report first describes the
economic impacts, and more specifically the fiscal impacts,
arising from disasters in the selected economies. The nine
detailed case studies are included as part 2 of the report. |
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