THE ECONOMIC EVALUATION AND SIGNIFICANCE OF AN EARLY RELOCATION VERSUS COMPLETE DESTRUCTION BY A POTENTIAL TSUNAMI OF A COASTAL CITY IN ECUADOR

Abstract

The coastal part of continental Ecuador is highly vulnerable for tsunami hazards as shown in the past two centuries. In order to avoid future devastating destructions in a given part in the coastline, we have estimated the economic effects of a potential future tsunami for one small Pacific town in Ecuador in order to analyze such potential cost of damages and compare it with a proposed resettlement value of the entire town. In past, most of the known resettlement projects have been realized as result of a natural disaster or a planning infrastructure such as hydro-electrical plants. Yet, in this study, we have considered to propose to policy makers and other authorities to take into account that a resettlement plan should be realized prior an impact by one the most deadly natural hazard. The results include four different scenarios of economic losses as a result of a potential tsunami, using human losses as the only variable that vary. Potential economic losses vary from 441 US$ up to 620 US$ millions, when compared to a potential resettlement and associated costs based on the four scenarios. The B/C ratio is favorable to town resettlement as Government’s preventing policy favoring an intelligent reduction and prevention of vulnerability and loss of human life.

Keywords

• Tsunami
• Economic loss
• Resettlement
• Prevention