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  • ISBN 92-64-02018-703 2004 01 1 P

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    Large-scaleDisastersLESSONS LEARNED

    Large-scale DisastersLESSONS LEARNED

    The September 11th terrorist attacks, the Chernobyl nuclear accident, HurricaneAndrew and the Kobe earthquake are all recent examples of large-scale disastersthat have taken a massive toll in human lives, wealth and property. They havedisrupted vital systems such as transport and energy supplies and spilled overinto neighbouring as well as distant regions. They have also generated widespreadanxiety, and in some cases created deep-seated public mistrust of governmentsability to protect their citizens.

    This book is based on a report prepared between May and July 2003 by a multi-disciplinary team of experts from inside and outside of the OECD. It examines theeconomic and social impacts of past large-scale disasters, and draws a numberof key lessons for the future. Its focus is on better prevention of disasters, and onrestoring trust and securing recovery in their aftermath.

    OECD's books, periodicals and statistical databases are now available via www.SourceOECD.org,our online library.

    This book is available to subscribers to the following SourceOECD themes:Finance and Investment/Insurance and PensionsGeneral Economics and Future StudiesGovernance

    Ask your librarian for more details of how to access OECD books on line, or write to us at

    SourceOECD@oecd.org

    -:HSTCQE=UWUV]Y:

  • OECD, 2004.

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  • Large-Scale DisastersLessons Learned

    ORGANISATION FOR ECONOMIC CO-OPERATION AND DEVELOPMENT

  • ORGANISATION FOR ECONOMIC CO-OPERATIONAND DEVELOPMENT

    Pursuant to Article 1 of the Convention signed in Paris on 14th December 1960,and which came into force on 30th September 1961, the Organisation for EconomicCo-operation and Development (OECD) shall promote policies designed:

    To achieve the highest sustainable economic growth and employment and a risingstandard of living in member countries, while maintaining financial stability, andthus to contribute to the development of the world economy.

    To contribute to sound economic expansion in member as well as non-membercountries in the process of economic development. And

    To contribute to the expansion of world trade on a multilateral, non-discriminatorybasis in accordance with international obligations.

    The original member countries of the OECD are Austria, Belgium, Canada, Denmark,France, Germany, Greece, Iceland, Ireland, Italy, Luxembourg, the Netherlands, Norway,Portugal, Spain, Sweden, Switzerland, Turkey, the United Kingdom and the United States.The following countries became members subsequently through accession at the datesindicated hereafter: Japan (28th April 1964), Finland (28th January 1969), Australia(7th June 1971), New Zealand (29th May 1973), Mexico (18th May 1994), the Czech Republic(21st December 1995), Hungary (7th May 1996), Poland (22nd November 1996), Korea(12th December 1996) and the Slovak Republic (14th December 2000). The Commission ofthe European Communities takes part in the work of the OECD (Article 13 of the OECDConvention).

    Publi en franais sous le titre :

    Catastrophes de grande ampleurLeons du pass

    OECD 2004

    Permission to reproduce a portion of this work for non-commercial purposes or classroom use should be obtained through

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  • TABLE OF CONTENTS

    LARGE-SCALE DISASTERS ISBN 92-64-02018-7 OECD 2004 3

    Table of Contents

    Introductionby Michael Oborne . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

    Chapter 1. Lessons learnedby Reza Lahidji . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

    Chapter 2. Key issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25

    1. Economic recovery from past disastersby Patrick Lenain. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27

    2. Budgetary impactby Patrick Lenain . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33

    3. Impact on insurance and financial marketsby Sebastian Schich. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37

    4. An insurance perspective on disaster managementby Ccile Vignial-Denain . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45

    5. Compensation issuesby Ccile Vignial-Denain . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53

    6. Housing and reconstructionby Josef Konvitz. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63

    7. Lessons learned from nuclear accidentsby Edward Lazo . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71

    Chapter 3. Case Study. The 1999 Marmara earthquakes in Turkey . . . . . . . . . . by Vedat Akgiray, Gulay, Barbarasoglu and Mustafa Erdik . . . . . . . . . . . 77

    Bibliography of recent OECD work in related areas . . . . . . . . . . . . . . . . . . . . . . . 93

  • ISBN 92-64-02018-7

    Large-Scale Disasters

    Lessons Learned

    OECD 2004

    Introduction

    by Michael Oborne

    LARGE-SCALE DISASTERS ISBN 92-64-02018-7 OECD 2004 5

  • INTRODUCTION

    This report analyses the economic and social impacts of recent large-scaledisasters, and draws some initial lessons for the monitoring and themanagement of future disasters. The report primarily focuses on restoringtrust and securing recovery after a major harmful event has occurred.

    The events reviewed are as diverse as the Chernobyl nuclear accident, theKobe and Marmara earthquakes, Hurricane Andrew, and the 11 Septemberterrorist attacks on New York and Washington. Disasters such as these have incommon massive effects on large concentrations of people, activity andwealth. They disrupt multiple vital systems such as energy supplies, transportand communications. Their effects spread beyond the region originallyaffected and generate widespread anxiety. In some cases, the public expressesdistrust of the ability of governments to protect citizens.

    The report was prepared between May and July 2003, by a team ofspecialists from eight OECD Directorates under my supervision. A team ofTurkish specialists provided material for Chapter 3.

    The text begins with an overview of the important commonalities amongthese different disaster events (Chapter 1). It is followed by a series of morespecialized texts which look carefully at specific sectoral impacts (Chapter 2).The 1999 earthquakes in the Marmara region of Turkey are the subject of acase study (Chapter 3). An annotated bibliography closes the report.

    The overview section of Chapter 1 focuses on the following policymessages:

    Governments can and must be better prepared to mitigate the economicand social impact of disasters by better planning and coordination acrossgovernment responsibilities.

    Public trust, as well as consumer and investor confidence are key elements toensure rapid and systemic recovery; these elements need to be strengthenedthrough credible communication and effective action of both the public andprivate sectors.

    Governments need to work more closely in partnership with the privatesector, which has key roles to play in disaster prevention, preparedness,response and recovery.

    Major disasters and harmful events can have multiple internationaldimensions, and these call for more systematic international co-operation.

    LARGE-SCALE DISASTERS ISBN 92-64-02018-7 OECD 20046

  • INTRODUCTION

    These policy lessons are drawn from extensive OECD work on disaster-related issues.

    The sectoral notes in Chapter 2 provide insights into recent OECDwork.on risk and disaster impact by analyzing eight specific issues:

    Measuring the impact of large-scale disasters.

    Economic recovery from past disasters.

    Impacts on public finances.

    The consequences for financial and insurance markets.

    Disaster management through insurance.

    Compensation issues.

    Housing and community reconstruction.

    Lessons learned from nuclear accidents.

    Chapter 3 of the report deals with the Turkish response to the Marmaraearthquake disaster in some detail. An annotated bibliography of recent OECDpublications related to disaster management is included to guide the readertoward recent economic lite