The impact of disasters on economic growth in selected Southern Africa development community countries

Emmanuel Owusu-Sekyere,Selma T Karuaihe,Wilfred Lunga

doi:10.4102/jamba.v13i1.1081

Abstract

This research study explores the impact of disasters on economic growth in selected Southern Africa Development Community countries. Annual data from 2005 to 2019 and panel data econometric estimation techniques are used in this study. The estimation approaches used control for both pooled and individual effects, heteroscedasticity, serial correlation, moderate levels of endogeneity and cross-sectional dependence (CSD). We found that although the impact of disasters on economic growth may be negative contemporaneously, reconstruction and recovery activities if well-resourced could facilitate building back better, which could ultimately lead to positive outcomes on economic growth a year after the disaster. We further tested the hypothesis in existing literature and confirm that quality institutions, favourable financial conditions and adequate access to international markets enhance a country’s coping and adaptive capabilities to disasters, thereby reducing the country’s level of risk to disasters.

Highlights

Research studies on the impact of disasters on prone regions have gained considerable attention over time
The lack of proper coordination leads to inefficient allocation of resources by separate government institutions for disaster risk reduction and climate change within Southern Africa Development Community (SADC) member states, duplication of services, polarisation of interventions, incoherent policies, competing for the same resources and territorial contests (Nemakonde et al 2021)
The United Nations International Strategy for Disaster Risk Reduction (UNISDR 2017) posited that understanding the economic impacts of disasters plays an important role in the effective mitigation of disaster damage, which is one of the key challenges facing nations located in disaster-prone regions that are aiming to achieve sustainable growth

Summary

Introduction

Research studies on the impact of disasters on prone regions have gained considerable attention over time. This is driven by increased awareness of the disastrous impact of climate change and variability and the need for building back better post-disaster. There are no signs of the risk posed by natural hazards decreasing, having witnessed the devastating effect of droughts, climate change-induced floods and cyclones in recent times (The World Bank 2019). This research study, seeks to explore the impact of disasters on economic growth in selected SADC countries, a region highly prone to disasters of diverse forms. The regionalisation of the study is important because of the spillover effects of disasters in the form of either physical damage, economic impact or humanitarian crisis

Literature review

Findings

Conclusion