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EghtesadOnline: Recent floods, snow and storms have inflicted losses worth 22,320 billion rials ($80 million) on Kerman Province, says director general of governor general’s office for crisis management.

“Nineteen cities of Kerman Province were hit by natural disasters during Jan. 2-6. Losses incurred by the agriculture sector and infrastructures are estimated to reach 9,320 billion rials [$33 million] and 13,000 billion rials [$47 million], respectively,” Majid Saeedi was also quoted as saying by IRNA.

“Due to the failure of some nomads in heeding warnings related to the timely evacuation of pastures, Hamoun-e Jazmurian in particular, as many as 1,407 head of livestock were killed. A total of 1,907 homes in urban and rural areas were also damaged, of which 450 units must be demolished and renovated, and the rest need repair,” he said.

Recent floods affected the agriculture sector and infrastructures of Sistan-Baluchestan, Kerman and Fars provinces. Qalehganj, Roudbar-e Jonoubi and Manoujan counties in the south of Kerman Province were the hardest hit. At least eight people were killed and many more were injured.

In 2019, heavy flooding in the country’s south left at least 76 people dead and caused damage estimated at over $2 billion.

Statistics show that only 3% of Iran are located in areas with a low risk of disasters. Iran is exposed to 32 out of 43 natural disasters, the most common of which are drought, earthquake, flood, wildfire and landslide. The Crisis Management Organization says 75% of Iran’s centers of population (geographical points that describes a center point of the region’s population) are exposed to flooding hazards and 80% of the country’s area are prone to be affected by other natural disasters like earthquake. 

The highest number of human deaths caused by a natural disaster in the country was associated with earthquake while flood and drought have inflicted the biggest losses economically for Iran. In addition, the acceleration of climate change over the past years is likely to make natural disasters even more frequent and more catastrophic in the country.

“Over the past few years and decades, our executive managers had been negligent in taking proactive policy approaches in the face of natural disasters whereas advance, short-, mid- and long-term planning rather than ‘after the event’ disaster response is needed to counter natural disasters,” Ali Beitollahi, the head of Engineering Seismology Department of Roads and Urban Development Research Center, has been quoted as saying.

A report by IMF entitled "Macroeconomic Outcomes in Disaster-Prone Countries" published in October 2019 categorized Iran among first quartile (0%-25%) of the annual probability distribution of natural disasters in non-disaster-prone countries. 

Iran’s economic costs of natural disasters were equivalent to 0.27% on average and a maximum of 2.9% of the country’s GDP during 1998-2017. 

The macroeconomic impact of natural disasters includes three stages. The first stage involves direct losses from the destruction of infrastructure and property. In the second stage, indirect losses accumulate from foregone output and incomes, and costs are incurred as individuals and businesses work around disruptions. 

Finally, as the recovery starts, rebuilding of infrastructures and replacement of damaged goods leads to a temporary boost in activity and employment in the affected area. It also opens up the opportunity to upgrade infrastructures. 

Apart from the cycle of impact and recovery from individual disasters, the periodic destruction of part of a country’s productive assets is an implicit tax on capital, which tends to deter investments and lower productivity and living standards on a sustained basis, the report concluded.