{ "id": "S07", "slug": "core-disaster", "title": "A major disaster disables the national economic core", "version": "0.5.0", "status": "active", "orientation": "downside", "family": "C", "short_title": "Core disaster", "thematics": [ "climate-energy-resources", "resilience-crisis-preparedness" ], "likelihood_type": "idiosyncratic", "likelihood_note": "The probability that a given nation experiences the Standard Severe event in its principal economic concentration. Risk is clustered in nations with one dominant city on a hazard-exposed site.", "scores": { "likelihood_2y": { "band": 2, "rationale": "Disasters with damage near or above 8 per cent of GDP are recorded a handful of times each decade across 197 nations, mostly in smaller or lower-income states: Haiti 2010, Chile 2010, Thailand 2011 and Nepal 2015 qualify, while the 2023 earthquakes cost Türkiye about 4 per cent. That base rate gives a given nation under 1 per cent in two years. The first-pass rating of band 3 counted any 1-in-100 hazard, not one meeting the damage threshold." }, "likelihood_10y": { "band": 3, "rationale": "The same base rate over ten years gives a given nation a few per cent, inside band 3. Exposure is rising: people and assets continue to concentrate in coastal, riverine and seismic zones, and warming raises the frequency of extreme rainfall, heat and fire weather. Nations with one dominant city on an exposed site sit above the band; large economies with dispersed activity sit below it." }, "impact_systemic": { "level": 1, "rationale": "The event strikes one nation. Even the costliest recorded disasters fall below 0.5 per cent of world output: the Japanese government put direct damage from the 2011 Tōhoku earthquake at about 16.9 trillion yen. Spillovers run through particular supply chains, as with hard disk drives after the 2011 Thailand floods, and fade within about a year. The level would rise only where the core is a global financial or manufacturing hub." }, "impact_national": { "level": 4, "rationale": "Direct damage of 8 per cent of GDP, a tenth of the population affected and a month of essential services below half capacity place economic damage and essential services at Severe. The level is not Catastrophic because the state, the currency and most of the territory continue to function and reconstruction completes in two years. Türkiye in 2023 absorbed damage of about 4 per cent of GDP without losing fiscal control; this event is twice that." }, "confidence": { "level": "medium", "reason": "Hazard science and loss records are mature and the panel members who held the scenario gave identical ratings. The step from a common damage threshold to a frequency for each nation is less certain." }, "priority": 8, "tier": "III", "source": "model-panel-v0.5" }, "scorecard": { "onset": "days", "duration": "30 days (acute phase)", "warning": "days (none for the earthquake variant)", "scope": "national", "origin": "natural", "external_support": "partial", "policy_response": "current plans executed", "recovery_horizon": "years (two-year reconstruction)" }, "summary": "A flood, storm, fire, heat emergency or earthquake strikes the nation's principal economic concentration. The hazard is the one most relevant to that nation, calibrated to a common consequence: 10 per cent of the population affected and direct damage equal to 8 per cent of annual GDP. Key transport, water and health assets in the core operate below half capacity for 30 days. Reconstruction takes two years and insurance covers less than half the loss. The scenario does not impose an identical physical hazard on every nation. It tests evacuation, continuity of essential services and recovery finance. It is the only natural-hazard test among the twenty.", "narrative": { "dateline": "November 2031", "text": "The cyclone made landfall on 14 September 2029, forty kilometres from the capital, at the top of a spring tide. Forecasters had given four days' notice and the evacuation order was issued 36 hours before landfall. About 60 per cent of those ordered to leave did so. The river embankments on the eastern side of the city, last strengthened four decades earlier, were overtopped in three places during the night.\n\nBy the morning of 15 September, water stood in districts that held a tenth of the national population and produced close to a third of national output. The container port closed. The two main rail approaches and the airport access road were cut. Four of the nine water treatment works lost power or were contaminated, and supply to the metropolitan area fell to 40 per cent of normal. Three of the region's largest hospitals evacuated their patients. The others worked on generators, with fuel delivered by the army. Mobile coverage in the flooded districts failed within twelve hours as the batteries at base stations ran down.\n\nThe acute phase lasted a month. For those 30 days, port throughput, piped water and hospital capacity in the capital region stayed below half their normal levels. The central government ran the response from a secondary site because its own operations centre was inside the flood zone. Payment of emergency grants began in the third week, once the civil registry had been restored from a copy held in another city. Households without bank accounts or identity documents waited longer.\n\nThe assessment published in December 2029 put direct damage at 8 per cent of annual GDP. Insurers and the national catastrophe pool covered 38 per cent of the loss. The rest fell on households, small firms, the municipality and the central budget. The government drew its contingent credit line in the first week and its catastrophe bond paid out in November. Together these met less than a fifth of the public reconstruction bill. The remainder was financed by a supplementary budget, reallocated capital spending and new borrowing at a wider spread.\n\nOutput in the quarter after landfall was 5 per cent lower than a year earlier. Exporters that depended on the port lost contracts to suppliers in neighbouring countries and some did not regain them. About 300,000 people were still in temporary housing six months later. Two insurers withdrew flood cover from the low-lying districts in 2030 and mortgage lending there slowed.\n\nReconstruction was declared complete in September 2031, two years after landfall. The embankments were rebuilt to a higher standard and the operations centre was moved. The parliamentary inquiry found that the forecast and the warning had worked. It attributed the scale of the loss to three conditions that had been known beforehand: the state of the eastern defences, the siting of critical facilities inside the flood zone and the absence of finance arranged before the event." }, "anchors": [ { "shock_id": "turkiye-syria-earthquake-2023", "date": "6 February 2023", "event": "Türkiye–Syria earthquake", "what_happened": "Two earthquakes of magnitude 7.8 and 7.5 struck southern Türkiye and northern Syria on the same day. More than 50,000 people died in Türkiye and several thousand in Syria. Eleven Turkish provinces were affected. The World Bank estimated direct physical damage in Türkiye at US$34.2 billion, equivalent to 4 per cent of 2021 GDP.", "calibrates": "A large middle-income economy absorbed damage at half this scenario's threshold, in provinces that were not its economic core. It sets the scale at which building-code enforcement, emergency housing and the fiscal response decide the outcome." }, { "shock_id": "thailand-floods-2011", "date": "July 2011 to January 2012", "event": "Thailand floods", "what_happened": "Flooding along the Chao Phraya basin affected 65 of 77 provinces and inundated seven industrial estates north of Bangkok. More than 800 people died. The World Bank estimated damage and losses at about US$46 billion, most of it in manufacturing. Production of vehicles and hard disk drives was interrupted for months and manufacturers in other countries lost supply.", "calibrates": "The closest recorded case of a natural hazard reaching a nation's industrial core. It calibrates the loss as a share of GDP, the industry and supply channel and the limited, short-lived effect outside the country." }, { "shock_id": "great-hanshin-earthquake-1995", "date": "17 January 1995", "event": "Great Hanshin (Kobe) earthquake", "what_happened": "An earthquake beneath the Kobe area killed more than 6,400 people and destroyed elevated expressways, rail lines and most berths at the port. Damage was put at about US$100 billion, around 2 per cent of Japan's GDP at the time, and only a small share was insured. The port of Kobe, then among the world's busiest container ports, took about two years to restore and did not recover its former rank.", "calibrates": "The two-year reconstruction period and the permanent loss of trade from a damaged hub. It also shows that a high-income nation with strong institutions can carry a low insured share." }, { "shock_id": "pakistan-floods-2022", "date": "June to October 2022", "event": "Pakistan floods", "what_happened": "Monsoon flooding affected about 33 million people and killed more than 1,700. The government-led post-disaster needs assessment put damage at US$14.9 billion, economic losses at US$15.2 billion and reconstruction needs at US$16.3 billion.", "calibrates": "A flood at national scale in a lower-income state with little insurance and limited fiscal space. Reconstruction depended on external pledges, which is the 'partial' external support setting." }, { "shock_id": "los-angeles-wildfires-2025", "date": "January 2025", "event": "Los Angeles wildfires", "what_happened": "The Palisades and Eaton fires destroyed more than 16,000 structures and killed about 30 people. Insured losses were estimated at around US$40 billion, the costliest wildfire event on record for insurers. Several insurers had reduced cover in the affected areas before the fires.", "calibrates": "The fire variant in a high-income core. It marks the upper end of the insured share and shows how the retreat of private cover moves the cost of rebuilding to households and public pools." }, { "shock_id": "valencia-floods-2024", "date": "29 October 2024", "event": "Valencia floods", "what_happened": "Extreme rainfall caused flash floods in the Valencia region of Spain. More than 220 people died. The regional alert to mobile phones was sent after flooding had already begun in several towns.", "calibrates": "Warning time available is not warning received. A high-income state with accurate forecasts lost lives through late alerting, which the evacuation test must capture." } ], "parameters": { "common": { "severity": { "major": "major", "severe": "severe", "extreme": "extreme" }, "duration": { "major": "30 days", "severe": "30 days", "extreme": "90 days" }, "onset": { "major": "days", "severe": "days", "extreme": "days" }, "warning": { "major": "days", "severe": "days (none for the earthquake variant)", "extreme": "none" }, "scope": { "major": "national", "severe": "national", "extreme": "national" }, "origin": { "major": "natural", "severe": "natural", "extreme": "natural" }, "external_support": { "major": "full", "severe": "partial", "extreme": "none" }, "concurrency": { "major": "standalone", "severe": "standalone", "extreme": "plus one named scenario (S02)" }, "policy_response": { "major": "current plans executed", "severe": "current plans executed", "extreme": "none (pure exposure)" }, "recovery_horizon": { "major": "months", "severe": "years", "extreme": "structural" } }, "specific": [ { "name": "Hazard type", "default": "the hazard most relevant to the nation's core", "range": "flood, storm, fire, heat emergency or earthquake", "unit": null, "note": "Chosen nation by nation. The consequence, not the physical intensity, is held constant." }, { "name": "Share of population affected", "default": "10", "range": "5 to 25", "unit": "per cent of national population", "note": "Evacuated, displaced, injured or without essential services during the acute phase." }, { "name": "Direct damage", "default": "8", "range": "4 to 20", "unit": "per cent of annual GDP", "note": "Physical damage to buildings, infrastructure and stock. Output losses are additional." }, { "name": "Capacity of key assets in the core", "default": "below 50", "range": "25 to 75", "unit": "per cent of normal capacity", "note": "Applies to transport, water and health assets for the whole of the acute phase." }, { "name": "Acute phase", "default": "30", "range": "14 to 90", "unit": "days", "note": "The period during which key assets remain below the capacity setting." }, { "name": "Reconstruction period", "default": "2", "range": "1 to 5", "unit": "years", "note": "Time to restore damaged assets. Lower-income nations may warrant the upper end." }, { "name": "Insured share of the loss", "default": "40", "range": "5 to 49", "unit": "per cent of direct damage", "note": "Private insurance and public catastrophe pools together. The specification requires less than half." } ] }, "transmission": [ "The hazard strikes the principal economic concentration, affecting 10 per cent of the population and destroying buildings and infrastructure worth 8 per cent of annual GDP.", "Warning, evacuation and building standards determine deaths and injuries. Where alerts arrive late or people do not act on them, casualties rise sharply.", "Transport, water and health assets in the core operate below half capacity for a month. Power and telecommunications outages slow the response.", "Firms in the core stop work. Ports, airports and logistics hubs close and suppliers and customers elsewhere in the country lose inputs and markets.", "Insurance pays less than half the loss. Households, small firms and municipalities carry the rest or wait for public support.", "The central budget funds relief and reconstruction through reallocation and borrowing. Sovereign spreads widen where fiscal space is thin.", "Displacement, interrupted schooling and deferred health care persist through a two-year reconstruction. Some firms and residents do not return.", "Insurers reprice or withdraw cover in the affected districts and an inquiry assigns responsibility, which shapes public confidence in the authorities." ], "loading": [ { "dimension": "Hard", "domain": "defence-security", "load": "Medium", "channel": "Armed forces divert to search and rescue, logistics and engineering; bases and readiness in the core are degraded." }, { "dimension": "Hard", "domain": "strategic-infrastructure", "load": "High", "channel": "Transport, water, power, telecommunications and hospitals in the core run below half capacity for a month." }, { "dimension": "Hard", "domain": "critical-technology", "load": "Low", "channel": "Early-warning, geospatial and data facilities are strained; sites in the core depend on backup power." }, { "dimension": "Soft", "domain": "government-effectiveness", "load": "High", "channel": "Evacuation, continuity of government, registration, payments and a two-year reconstruction programme test central and city administration." }, { "dimension": "Soft", "domain": "human-capital", "load": "High", "channel": "Deaths, injuries, hospital evacuation, displacement, interrupted schooling and loss of skilled workers from the core." }, { "dimension": "Soft", "domain": "influence-cohesion", "load": "Medium", "channel": "Confidence in the authorities depends on the fairness of relief and the findings of the inquiry." }, { "dimension": "Economic", "domain": "macro-financial", "load": "High", "channel": "Uninsured losses fall on the budget, banks and households; borrowing rises and insurers reprice or withdraw." }, { "dimension": "Economic", "domain": "industry-trade-supply", "load": "High", "channel": "Output stops in the core; port and logistics closures cut exports and break domestic supply chains." }, { "dimension": "Economic", "domain": "energy-resources", "load": "Medium", "channel": "Generation, fuel distribution and water supply in the core are interrupted; repair depends on imported equipment." } ], "stakeholders": { "government": { "exposure": "Warning and evacuation systems, continuity-of-government sites, flood defences and building-code enforcement, finance arranged before the event and the capacity of city authorities.", "actions": [ "Test evacuation of the core at full scale and publish the compliance rate", "Arrange contingent credit, catastrophe bonds and reserve funds sized to a loss of 8 per cent of GDP", "Move operations centres, registries and backup sites outside the mapped hazard zone" ], "watch": [ "Condition surveys of embankments, dams and drainage", "Insured share of residential and commercial property in the core", "Seasonal forecasts and seismic hazard updates" ], "relevance": 4 }, "technology": { "exposure": "Data centres, exchanges, base stations and cable landing points sited in the core, the delivery of alerts and the duration of backup power.", "actions": [ "Hold recoverable copies of registries and payment systems in a second region", "Extend backup power at base stations and exchanges to at least 72 hours", "Test cell-broadcast alerts against the full population of the core" ], "watch": [ "Hazard maps set against the location of critical sites", "Results of backup power and fuel resupply tests", "Recovery time achieved in failover exercises" ], "relevance": 3 }, "investors": { "exposure": "Property insurers, reinsurers, sovereign and municipal debt, mortgage books, utilities and firms with a single site in the core.", "actions": [ "Screen assets and suppliers for location in the core hazard zone", "Stress sovereign and municipal credit for an uninsured loss of 4 to 5 per cent of GDP", "Reflect the possible withdrawal of insurance cover in property and mortgage valuations" ], "watch": [ "Reinsurance renewal prices and terms", "Insurer exits and the growth of public pools by district", "Sovereign use of contingent credit and catastrophe bonds" ], "relevance": 5 }, "public": { "exposure": "Households and small firms in the hazard zone, above all those without insurance, savings, bank accounts or identity documents.", "actions": [ "Know the evacuation route and the conditions under which to leave", "Keep water, medicines and copies of documents for 72 hours", "Check what the household insurance policy covers and excludes" ], "watch": [ "Official alerts and evacuation orders", "Local hazard maps and the state of defence works", "Changes in the price and availability of home insurance" ], "relevance": 4 } }, "regions": [ { "region": "north-america", "exposure": "High", "rationale": "Hurricane, wildfire and earthquake exposure meets very high asset values on the Gulf, Atlantic and Pacific coasts; insurers are withdrawing from several markets." }, { "region": "europe", "exposure": "Medium", "rationale": "River floods and heat are the main hazards, with seismic risk in the south-east; activity is dispersed and public backstops are strong." }, { "region": "china", "exposure": "High", "rationale": "Typhoon, flood and earthquake exposure coincides with the delta city clusters that hold a large share of output and exports." }, { "region": "indo-pacific", "exposure": "High", "rationale": "Typhoons and earthquakes strike capital regions directly; in Pacific island states the core is most of the country." }, { "region": "south-asia", "exposure": "High", "rationale": "Monsoon floods, cyclones, extreme heat and Himalayan seismic risk meet dense cities, low insurance cover and limited fiscal space." }, { "region": "gulf-middle-east", "exposure": "Medium", "rationale": "Extreme heat and flash floods are rising; Türkiye and Iran carry major seismic risk, while Gulf states hold fiscal buffers." }, { "region": "africa", "exposure": "High", "rationale": "Floods and cyclones strike fast-growing coastal and river cities with thin drainage, low insurance cover and little arranged finance." }, { "region": "latin-america", "exposure": "High", "rationale": "Hurricanes, earthquakes and El Niño floods fall on dominant capital cities; Caribbean states can lose more than a year's output." }, { "region": "russia-eurasia", "exposure": "Medium", "rationale": "Central Asian and Caucasus capitals sit on active faults; Russian activity is dispersed, with wildfire and river floods the main hazards." } ], "indicators": [ { "name": "El Niño and La Niña state and seasonal outlook", "source": "WMO El Niño/La Niña Update", "threshold": "El Niño or La Niña conditions declared for the coming season", "cadence": "quarterly" }, { "name": "River flood forecasts for the core basin", "source": "Global Flood Awareness System (GloFAS), Copernicus Emergency Management Service", "threshold": "forecast flow above the 20-year return level", "cadence": "daily" }, { "name": "Coverage of multi-hazard early warning systems", "source": "UNDRR and WMO, Global Status of Multi-Hazard Early Warning Systems", "threshold": "no multi-hazard early warning system reported", "cadence": "annual" }, { "name": "Insured share of natural catastrophe losses", "source": "Swiss Re Institute, sigma", "threshold": "insured share below 40 per cent of national catastrophe losses", "cadence": "annual" }, { "name": "Property catastrophe reinsurance pricing", "source": "Guy Carpenter Global Property Catastrophe Rate-on-Line Index", "threshold": "rise of more than 20 per cent at the January renewal", "cadence": "annual" }, { "name": "Hazard exposure and coping capacity by nation", "source": "INFORM Risk Index, European Commission Joint Research Centre", "threshold": "hazard and exposure score above 6 with lack of coping capacity above 5", "cadence": "twice a year" }, { "name": "Recorded disaster losses relative to GDP", "source": "EM-DAT, Centre for Research on the Epidemiology of Disasters", "threshold": null, "cadence": "continuous" }, { "name": "Seismic hazard at the principal city", "source": "Global Earthquake Model Foundation, Global Seismic Hazard Map", "threshold": null, "cadence": null } ], "compounds": { "triggers": [ { "id": "S05", "note": "A relief effort seen as failed or unfair, close to an election or succession, can open a dispute over lawful authority." }, { "id": "S06", "note": "Only where the core is also a major grain-producing or grain-exporting region; the loss then counts as one of the two failures." }, { "id": "S02", "note": "Only where the core is a global financial centre. Elsewhere the effect is a wider spread for one sovereign." }, { "id": "S18", "note": "Relief payments after a disaster expose paper delivery and create a mandate to replace it" } ], "triggered_by": [ { "id": "S06", "note": "The heat and drought behind the breadbasket failures can produce the heat emergency or fire variant in the same season." }, { "id": "S04", "note": "A power and telecommunications blackout during extreme heat or cold turns a manageable event into an emergency in the core." } ], "amplified_by": [ { "id": "S02", "note": "Closed markets and wider spreads remove the borrowing that funds reconstruction." }, { "id": "S05", "note": "Competing authorities cannot direct evacuation, relief or reconstruction." }, { "id": "S10", "note": "Hospitals already beyond surge capacity cannot take casualties or evacuated patients." } ], "triggered_by_other": [], "amplifying_trends": [ "Climate change & physical risk", "Urban population concentration", "Infrastructure ageing & maintenance backlog", "Insurance retreat & insurability", "Disaster risk finance", "Early-warning coverage", "Dams, reservoirs & flood defence", "Local & city government capacity" ] }, "open_questions": [ "Whether the common calibration should be a damage share of GDP, as specified, or a common return period, given that 8 per cent of GDP implies very different hazard intensities across nations.", "How to treat small island and city states, where the core is most of the country and direct damage can exceed annual GDP.", "Whether a heat emergency, whose deaths are diffuse and whose physical damage is small, fits a specification defined by direct damage and asset capacity.", "Whether a two-year reconstruction period holds for lower-income nations, where recovery from comparable events has taken longer." ], "commentary": null, "overview": { "source": "model-panel-v0.5", "lenses": { "political": "The inquiry asks what was known beforehand. **Accountability for known weaknesses**, more than the hazard itself, decides whether the government keeps public confidence.", "economic": "Direct damage equals **8 per cent of GDP** and insurance covers less than half. The remainder falls on households, small firms, municipalities and the central budget.", "social": "A **tenth of the population** is affected. Households without insurance, bank accounts or identity documents wait longest for housing and payments.", "technological": "Alerts reach phones in time, but **mobile coverage fails** in flooded districts within hours. Registries restored from a second site decide when payments start.", "legal": "**Building codes and land-use rules** set the scale of damage long before the event. Insurers withdraw cover from the worst-affected districts afterwards.", "environmental": "The **locally relevant hazard** is flood, storm, fire, heat or earthquake. Warming raises the frequency of the climate-related variants." }, "regions": { "north-america": "**Insurer withdrawal** is the distinctive exposure. The 2025 Los Angeles wildfires cost insurers around US$40 billion.", "europe": "River floods and heat, with **dispersed activity** limiting the national effect. Valencia in 2024 showed that alerting can still fail.", "china": "Typhoons, floods and earthquakes threaten the **delta city clusters** that carry much of national output and exports.", "indo-pacific": "Typhoons and earthquakes reach capital regions directly. In Pacific island states **the core is the country**.", "south-asia": "Monsoon floods, cyclones, heat and earthquakes meet **low insurance cover**. Pakistan's 2022 floods affected about 33 million people.", "gulf-middle-east": "Heat and flash floods are rising. **Türkiye and Iran** carry the region's seismic risk; Gulf states hold fiscal buffers.", "africa": "Fast-growing coastal and river cities face floods and cyclones with **little arranged finance** and thin drainage.", "latin-america": "Hurricanes, earthquakes and El Niño floods strike dominant capital cities. **Caribbean states** can lose more than a year's output.", "russia-eurasia": "**Central Asian capitals** sit on active faults. Russian activity is dispersed; wildfire and river floods are the main hazards." }, "evolution": { "lead_indicators": "**Forecast river flow above the 20-year return level** in the core basin, El Niño or La Niña declared for the coming season and an insured share below 40 per cent.", "triggers": "A flood, storm, fire, heat emergency or earthquake strikes **the principal economic concentration**. Warning is days at most, and none for the earthquake variant.", "immediate": "A tenth of the population is affected. Transport, water and health assets run **below half capacity for 30 days**, and power and telecommunications outages slow the response.", "post_immediate": "Firms in the core stop work and suppliers elsewhere lose inputs. **Insurance pays less than half** of damage worth 8 per cent of GDP; the budget borrows at wider spreads.", "stabilisation": "**Reconstruction takes two years**. Displacement, interrupted schooling and deferred health care persist throughout, and an inquiry assigns responsibility for weaknesses known beforehand.", "long_term": "Some firms and residents do not return and **lost trade is not fully regained**. Insurers reprice or withdraw cover in the affected districts and mortgage lending there slows." } }, "history": [ { "edition": 2027, "rank": 9, "L2y": 2, "L10y": 3, "impact_systemic": 1, "impact_national": 4, "confidence": "medium" } ], "changelog": [ { "version": "0.5.0", "date": "2026-10-09", "change": "Rebuilt in the second pass from Catastrophic disaster in the core: the event is now calibrated to a common consequence (10 per cent of the population affected, direct damage of 8 per cent of GDP, key assets below half capacity for a month) instead of a common return period; likelihood and impact each lowered one step; macro-financial and industry loads raised to High." } ], "citation": "GINC (2027). Scenario S07 A major disaster disables the national economic core, Scenario Library v0.5. scenarios.ginc.org/scenarios/core-disaster" }