10 October 2018: The UN Office for Disaster Risk Reduction (UNISDR) released a report that finds economic losses from climate-related disasters have increased by 151 percent. The report recommends integrating disaster risk reduction (DRR) into investment decisions to ensure sustainable development in a changing climate.

The report titled, ‘Economic Losses, Poverty and Disasters 1998-2017,’ examines key trends over the last 40 years on the effect of disasters on economic losses and human lives. The report finds that disaster-hit countries reported direct economic losses of US$2,908 billion. Out of these disasters, climate-related disasters accounted for 77 percent of the total. The report concludes that climate change is increasing the severity and frequency of extreme weather events and cautions that disasters will continue to impede sustainable development as long as the economic incentives to develop in hazardous-prone locations outweigh perceived disaster risk.

The report further cautions that economic losses suffered by low and lower-middle income countries are likely to have “crippling consequences” on their future development and their ability to achieve the SDGs, particularly SDG 1 (no poverty). Within this context, the report underscores the urgent need to reduce greenhouse gas (GHG) emissions and move towards a more sustainable world.

Economic losses from extreme weather events are unsustainable and a major brake on eradicating poverty in hazard exposed parts of the world.

Earthquakes and related tsunamis contributed to the largest number of lives lost, accounting for 56 percent of the total or 747,234 lives lost. In total, 1.3 million people lost their lives between 1998-2017 and an additional 4.4 billion people were rendered homeless, displaced, injured or in need of emergency assistance as a result of disasters. Although earthquakes caused the majority of fatalities, 91 percent of all disasters were attributed to storms, floods, droughts, heatwaves and other extreme weather events.

The report profiles economic losses by country, with the largest losses in the US, at US$944.8 billion, followed by China, at US$492.2 billion, and Japan, at US$376.3 billion. Other countries among the top ten for economic losses include India, Puerto Rico, France, Germany, Italy, Thailand and Mexico. Although high-income countries experience the majority of absolute economic losses, the report emphasizes that disaster events have a disproportionate impact on low and middle-income countries (MICs).

The report also raises concerns on the limited economic data found in disaster reports. The Sendai Framework for DRR includes Target c, which seeks to “reduce direct disaster economic loss in relation to global gross domestic product (GDP) by 2030.’ However, 63 percent of disaster reports do not contain economic data on losses from disasters. Low-income countries, for example, recorded losses for only 13 percent of reported disasters between 1998 and 2017; in other words, there are no loss data for 87 percent of disasters in low-income countries. These limited data hinder countries’ ability to measure progress towards this goal.

UN Secretary-General’s Special Representative for Disaster Risk Reduction, Mami Mizutori, said the report’s analysis shows “economic losses from extreme weather events are unsustainable and a major brake on eradicating poverty in hazard exposed parts of the world.” She called for doing a better job of capturing economic data to better understand what works in reducing economic losses, saving lives and livelihoods and managing economic risk.

UNISDR released the report in advance of the International Day for Disaster Reduction, which takes place on 13 October, and this year focuses on Sendai Target c. [Publication: Economic Losses, Poverty and Disasters 1998-2017] [UNISDR Press Release] [UNFCCC Press Release]