Chapter 7: A Framework <strong>for</strong> Risk Assessment and Risk-In<strong>for</strong>med Decision-Making <strong>for</strong> <strong>Infrastructure</strong> DevelopmentFigure 7.2: Distribution of consequences (losses of lives) due to natural disasters from 1991 to2005 by national economic categoryCES & CIS;1%OECD; 6%Countries not classified; 0%Least developed countries27%66%Developing countriesSource: EM-DAT - The OFDA/CRED International Disaster Database.Figure 7.3: Annual reported economic consequences from natural disasters from 1975 to 2005250In current billion US$20015010050019751976Eartquake Naples ProvinceItaly($47 billion)197719781979198019811982Selected disasters with largest economic impactSource: EM-DAT - The OFDA/CRED International Disaster Database.Flood VolgogradRussia($18 billion)1983198419851986198719881989199019911992Eartquake KobéJapan($121 billion)FloodChina($35 billion)1993199419951996199719981999WindstormFrance($12 billion)Windstorms Katrina and RitaUSA($131 billion)Earthquake NigataJapan($28 billion)200020012002200320042005While life expectancy has increased significantly in <strong>the</strong> last half century, this trend is less identifiable ona local scale; instead, correlation between local life expectancy and economic capacity is more apparent(see Figure 7.3). Inequities in economic capacity, correlatively, vulnerability translate to increased consequencesor losses <strong>for</strong> lower-income, less-developed countries.Threats and influence of climate change<strong>Climate</strong> change exacerbates <strong>the</strong> gravity of overusing and mismanaging natural resources, and thusimposes fur<strong>the</strong>r pressures on societies and sustainability ef<strong>for</strong>ts. According to <strong>the</strong> IntergovernmentalPanel on <strong>Climate</strong> Change, predicted climate change phenomena include increased frequency of heavyprecipitation events, drought, tropical cyclone activity and high sea level. Increases in rainfall, landslidesand floods are particular threats in El Salvador.82<strong>Paving</strong> <strong>the</strong> <strong>Way</strong> <strong>for</strong> <strong>Climate</strong>-<strong>Resilient</strong> <strong>Infrastructure</strong>: Conference Proceedings
Chapter 7: A Framework <strong>for</strong> Risk Assessment and Risk-In<strong>for</strong>med Decision-Making <strong>for</strong> <strong>Infrastructure</strong> DevelopmentPART IIThreats of climate change in <strong>the</strong> context of limited resources can motivate societies to improve development<strong>for</strong> its ensured sustainability. The consequences of increased climate-related events necessitateimmediate support based on best available knowledge. Using scenarios and knowledge developed bynatural scientists, engineers must focus ef<strong>for</strong>ts on assessing and identifying efficient means <strong>for</strong> circumventingor mitigating risks.TechnicalPresentation 1What a Country ShouldThink About andThen Do to Address<strong>Climate</strong> Change and<strong>Infrastructure</strong> RisksThe need <strong>for</strong> risk assessment and risk-in<strong>for</strong>med decision-making<strong>for</strong> infrastructure<strong>Infrastructure</strong> plays a key role in society by providing <strong>the</strong> basis <strong>for</strong> production and economic growth.Reciprocally, economic capacity and access to natural resources affect <strong>the</strong> capacity to develop and maintaininfrastructure. Investing in infrastructure must be balanced with benefitting economically from infrastructureon local, national, regional and global scales. This requires a holistic perspective <strong>for</strong> prioritizingsocietal investments.The primary challenges in sustainable risk-based infrastructure development are in assessing risks,communicating risks to all stakeholders, identifying relevant and efficient risk-reduction measures, anddeciding how to prioritize resources in society <strong>for</strong> risk management. These challenges warrant a framework<strong>for</strong> risk assessment and risk-in<strong>for</strong>med decision-making.Risk, sustainability and governanceThe need <strong>for</strong> sustainable development implies <strong>the</strong> current generation’s responsibility to ensure thatresource use is in balance with long-term capacity building and <strong>the</strong> priority of equity <strong>for</strong> safeguardingboth current lives and <strong>the</strong> lives of future generations. Given that risks indicate not what might happen, butwhat certainly will happen in <strong>the</strong> future, <strong>the</strong> need to develop sustainably suggests <strong>the</strong> critical importanceof good practices in risk assessment and optimal risk-based decision-making.<strong>Climate</strong> change risk constitutes a local, national and global issue caused by human decisions, and so mustbe addressed through centralized governance from local to global levels. Because risk is effectively equivalentto future losses, failure to make decisions about how to manage risks efficiently and consistently canresult in <strong>the</strong> most significant loss <strong>for</strong> society: systemic failure. While knowledge <strong>for</strong> predicting scenarios (ofwhat hazards will look like) and <strong>for</strong> analysing future situations is available, societies have still failed to makegood decisions based on this in<strong>for</strong>mation. Risk-in<strong>for</strong>med governance supported by normative decisionanalysis provides <strong>the</strong> basic framework <strong>for</strong> ensuring sustainable development.The risk management frameworkIn <strong>the</strong> last ten years, <strong>the</strong> Joint Committee on Structural Safety (JCSS) has developed a technical framework<strong>for</strong> assessing and managing risks. This systematic approach includes several principles established by JCSS<strong>for</strong> risk-based decision-making in engineering: (1) Bayesian probabilistic decision <strong>the</strong>ory (as economicdecision <strong>the</strong>ory; i.e. <strong>the</strong>ory of probability decision rules based on a priori in<strong>for</strong>mation), (2) methods ofprobabilistic mechanics, (3) direct/indirect consequences, (4) risk-based systems modeling, (5) genericrisk models using indicators (i.e. generic models that can be adapted to different situations), (6) decisionranking/selection (consistent with available knowledge), (7) socio-economical assessment of life safety,and (8) socio-economic sustainable discounting.TechnicalPresentation 2Internalization of<strong>Climate</strong> Risks in <strong>the</strong>Context of Planningand Urban DevelopmentTechnicalPresentation 3A Framework <strong>for</strong>Risk Assessmentand Risk-In<strong>for</strong>medDecision-Making <strong>for</strong><strong>Infrastructure</strong>DevelopmentTechnicalPresentation 4Probabilistic RiskModeling: BasicPrinciples andApplicationsTechnicalPresentation 5An Economic Framework<strong>for</strong> Evaluating <strong>Climate</strong>Proofing Investmentson <strong>Infrastructure</strong>TechnicalPresentation 6Supporting ElSalvador to Reduce<strong>Infrastructure</strong> Riskswithin a Green, Low-Emission and <strong>Climate</strong>-<strong>Resilient</strong> Framework<strong>for</strong> Development<strong>Paving</strong> <strong>the</strong> <strong>Way</strong> <strong>for</strong> <strong>Climate</strong>-<strong>Resilient</strong> <strong>Infrastructure</strong>: Conference Proceedings 83