Jamaica: Macro-Socio-Economic and Environmental Assessment of ...

VI. SUMMARY OF OVERALL DAMAGE AND LOSSES
The total impact of hurricane Ivan on Jamaica, as described in previous chapters of this
report, amounts to $35 931 million Jamaican dollars, or its equivalent of US$ 580 million. 10
In spite of some limitations imposed by the lack of sufficient data in some sectors or
activities, the above figure reflects the amount of damage and losses sustained by the
country.
Of the total figure quoted above, 62 per cent ($22 227 million) refers to damage to physical
assets and the remaining 38 per cent ($13 704 million) to indirect losses or changes in
economic flows that will occur during the remainder of 2004 and in the next three years 11 .
Partial information from the insurance industry indicates that an estimated amount of
$3,000 would be reimbursed to owners of affected homes and other infrastructure, no
information was available in regard to the possible insurance refunds to productive
activities.
The total amount of damage and losses is equivalent to 8 per cent of the country’s GDP for
the previous year, which figure provides a measure of the magnitude of the disaster for the
island. While the same hurricane imposed damage and losses to other neighboring island
states represent much higher figures 12 , the impact in Jamaica should not be underestimated,
especially in regard to its geographical distribution.
Of special relevance and interest is the breakdown of the above amount by type of impact,
as follows:
$ million Per cent
Destruction and damage to assets 22 278 62
Production losses 9 987 28
Increased operational expenses and revenue losses 3 666 10
The first type of impact refers to the amount of assets that have been lost or damaged and
which will have to be reconstructed or repaired in the following years, and is a measure of
the reconstruction effort to be undertaken by the government and private sector. In addition,
the second type of impact indicates the amount by which – after converting to value added
– gross domestic product will be affected. Finally, the third type of impact – while
admittedly underestimated due to lack of sufficient data especially in the transport sector –
is an indication of how private and public sector utilities will be affected in their financial
results for the year.
10 A uniform exchange rate of J$ 62 per United States Dollars has been utilized
throughout the assessment.
11 It has been demonstrated that in disasters caused by hydrometeorological phenomena,
the value of indirect losses normally exceeds that of direct damage. In this case, however,
and despite the underestimation of transport losses, the winds of the hurricane imposed
significant damage to assets that result in the out-of-pattern damage and loss structure.
12 Preliminary estimates indicate that the impact in Grenada was more than 2.4 times
the value of that country’s GDP.