Since 1950 natural disasters have affected approximately 2.5 million people in the Pacific region, causing 1,9752 reported deaths. This has cost the Pacific Island Countries (PICs) around USD1.6 billion (in nominal terms) in associated damage costs (EM-DAT,
2010). In September 2009 a tsunami hit Samoa, American Samoa and Tonga. This gave the region a distressing reminder that the Pacific is one of the most natural disaster prone regions of the world.

According to PNG DSP (2010), rising sea levels that result from climate change will force several coastal communities to relocated, with the associated costs of resettlement being very costly and raising the risk of conflicts. For example, the estimated cost of
the Caterat Island Refugees is around Kina 7 million, and for the Lombrun Naval Base communities this will be around Kina 26 million. Resources in this area are not currently available and the PNG DSP (2010) prioritises the need to make such resources available
by 2030, in addition to increasing research and data collection (such as improved tidal monitoring stations).

The Intergovernmental Panel on Climate Change (IPCC) Fourth Assessment Report has emphasised that if the planet’s surface temperature increases by 2°C above pre-industrial levels, a catastrophic collapse of ecosystems becomes possible with
unforseen, non-linear impacts on poverty and disaster risk. The IPCC has also confirmed that the geographic distribution, frequency and intensity of these hazards are already being significantly altered by climate change. This has strong implications for the Pacific.

For example, a rise in the mean sea level of 1 metre at the upper range of estimates for the next hundred years will have drastic consequences for many coastal communities (Dow and Downing, 2007). Evidence of rising sea levels has already emerged in the
Pacific after 2,000 inhabitants were forced to relocate after their homes were washed away by high tides and storm surges. Rising seas also forced the inhabitants of Tégua, Vanuatu, to abandon their island in December 2005 (Dow and Downing, 2007). With the climate trend models for the Pacific indicating increased extreme weather conditions and increased climate variability (IPCC, 2007), PICs have little choice but to develop comprehensive risk management plans for the hazards that they will face.
The objective of this report is to present a high level desk based assessment of the potential economic costs of a disaster and to identify the level of investment in Disaster Risk Management (DRM). This will be used to draw attention to the benefits of investing in Disaster Risk Reduction (DRR) versus the cost of a disaster.