Chapter 15: Preparing for the Next One¶
On June 25, 2020, in Bangladesh, the Red Crescent activates its early action protocol. Forecasts call for a flood of the Jamuna among the worst in decades. The National Society's model combines the expected river flow at the Bahadurabad station, the likely number of days above danger level, and the damage done by past floods. It points to the unions, the country's smallest rural administrative units, where the water will do the most harm. There are more of them than the available resources can cover. The Red Crescent selects ten, in three districts: the ones that will be hit hardest.
In these unions, each household gets a vulnerability score based on five criteria: how solid the house is, the water depth in earlier floods, the number of children, elderly or disabled people, the makeup of the family, and the main source of income. The 3,789 households selected each receive 4,500 taka, about $53, roughly two weeks of food spending. The money arrives between 48 and 24 hours before the first flood peak, which comes between June 30 and July 3. A second peak follows from July 14.
Six months later, a team surveys 444 households. Half received the money. The other half, just as vulnerable and just as flooded, did not, because the resources ran out. On one point the results are clear. Among the households that got cash, 51% lost or saw damage to their work tools, farm or fishing equipment, against 72% of the others. They borrowed less often to cope: 44% against 56%. They lost fewer cows and calves: 9% against 22%.
On another point the results are just as clear, and disappointing. The money did not help families get back to work any sooner. In both groups, households went an average of 46 days unable to work. The study's authors say so plainly: the intervention was not effective in reducing the flood's impact on the beneficiaries' earning potential.
Preparing protects what people own. It does not spare you the work of restarting what they earn.
What the scene teaches¶
Its authors present the Bangladesh study as one of the few rigorous evaluations of anticipatory action: a quasi-experimental comparison, covering a single event and 444 households. It tells a club three useful things.
The money arrived on time because everything had been decided beforehand. The trigger threshold, the priority areas, the household selection criteria, the amount, the payment partners: none of that can be improvised in 48 hours.
What preparation protects is exactly what recovery would otherwise have to rebuild. Work tools intact, a herd saved, a debt avoided: these are the productive assets and the indebtedness that Chapters 6 and 8 discuss.
Preparation does not replace recovery. Forty-six days without work in both groups: the flood cut off the income of the families who got help just as it did for the others. The authors offer one possible explanation: the households that received cash may have spent that time repairing their homes or caring for their relatives. Whatever the reason, once the water recedes, someone still has to put people back to work, reopen the markets, and restart credit.
This is where the trilogy comes full circle. The disaster guide covers the before and the during, the CED guide covers normal times, and this book covers the after. But the after of one disaster is the before of the next.
The principle: prepare the recovery before the disaster¶
What the Sendai Framework says¶
The Sendai Framework for Disaster Risk Reduction 2015-2030, adopted by the United Nations in 2015, devotes its fourth priority to "Enhancing disaster preparedness for effective response and to 'Build Back Better' in recovery, rehabilitation and reconstruction." Its paragraph 32 calls for action "in anticipation of events" and points out that the recovery, rehabilitation and reconstruction phase "needs to be prepared ahead of a disaster."
Three other passages bear directly on the local economy. Paragraph 4 notes that small, recurring disasters and slow-onset disasters hit communities, households, and small and medium-sized enterprises especially hard, and account for a high share of all losses. Paragraphs 30(j) and 31(g) call for linking social safety nets to programs that strengthen livelihoods. And paragraph 36(c) speaks to businesses, professional associations and philanthropic foundations: it asks them to build disaster risk management, business continuity included, into their business models and practices, "especially in micro, small and medium-sized enterprises."
This book suggests reading that paragraph as addressed to your club: an association of business owners and professionals, backed by a philanthropic foundation. Sendai does not name Rotary.
What the Rotary Foundation allows¶
Preparedness falls within the community economic development area of focus. Among its goals, the April 2024 area of focus policy statement lists strengthening the economic resilience of communities in the face of natural disasters, and developing community emergency preparedness services "to improve economic resilience." Among eligible activities, it lists training and basic resources for preparedness initiatives, and access for poor communities to financial services, savings and insurance included.
The April 2024 CED guidelines spell out what a preparedness project must provide: an assessment describing the emergencies of the past three to five years, how the authorities responded, the populations most affected and the economic losses suffered; where the project fits in the existing preparedness plan, with the approval of the relevant local or national authorities; and how it is integrated into existing municipal systems. In other words, the Foundation does not fund parallel preparedness. It funds a complement to what the authorities have already planned. Check these conditions in the current documents on My Rotary.
Five areas of work for a better-prepared economy¶
1. Business continuity for small businesses¶
A business continuity plan describes how a business responds, resumes and returns to a defined level of activity after a disruption. Large companies often have one; small ones rarely do. The 2020 report on small and medium-sized enterprises from the United Nations Office for Disaster Risk Reduction (UNDRR) gathers a few figures. In Japan, fewer than 10% of SMEs have such a plan: about 34% of companies with 101 to 300 employees, but about 2% of those with fewer than 20. In the Philippines, according to a survey by the United Nations Industrial Development Organization (UNIDO) cited by UNDRR, 75% of micro-enterprises had none, often because they did not know what one was or could not afford to write one.
The same report adds two nuances your club needs to know. First, having a plan is not enough. In Dominica and the British Virgin Islands, after Hurricanes Irma and Maria in 2017, 67% of the businesses surveyed had a continuity plan or procedures, yet the surveys found little integration of risk management. The report notes that the international definition of a continuity plan does not cover prevention: a plan says how to restart, not how to avoid being destroyed. Second, preparation seems to pay off. In Japan, only 8% of prepared SMEs had not regained their pre-disaster sales level, against 19% of unprepared SMEs. That is a correlation, not proof: the businesses that prepare may also be the best managed.
The most useful figure for a club lies elsewhere. In Japan, among companies with more than 20 employees, 68% put a plan in place when their direct customers encouraged them to, against 8% without such a request. Small businesses prepare when the people they work with ask them to. Club members are customers, suppliers, bankers, contractors. They can put the question to their own suppliers, and help them answer it. The Minimum Economic Recovery Standards (MERS) recommend the same in general terms: help market actors prepare for shocks, including through financial and organizational planning.
2. Savings, and their limits¶
A literature review published in 2021 for the Mastercard Foundation's Savings Learning Lab, with the SEEP Network, concludes that savings, often through savings groups, frequently help people withstand shocks without selling their assets or cutting back on meals. After the 2015 earthquake in Nepal, households in informal savings groups coped better than others, even though only 23% of households reported using their savings: the benefit came mostly from the group's social support. In western Leyte, a year after Haiyan, a study commissioned by Mercy Corps found that informal savings had helped recovery and formal savings had not, probably because banks were out of reach right after the typhoon.
The same review sets the limit: personal savings may not be enough in the face of a severe or repeated shock, and savings groups struggle to pay out to all their members when a disaster hits everyone at once. Encourage savings groups; never present them as insurance against disaster.
3. Insurance, and whom to insure¶
In Haiti, after the 2010 earthquake, Fonkoze treated its affected clients as if they had already been paying for catastrophe micro-insurance: a cash payment, the loan balance canceled, a new loan available (Chapter 6). It turned this into a permanent product, officially launched on January 12, 2011, one year to the day after the earthquake. By 2012, according to the institution, it was mandatory for its 60,000 microcredit clients, with a premium of about 3% of the loan for most of them. When a claim is accepted, Fonkoze cancels the loan balance, grants a new loan and pays out about $125.
A study on a small sample, after the October 2011 rains in Les Cayes, shows what this covers and what it does not. The cancellation and the payout together came to about half of the policyholders' total losses, and the average time to payment ranged from about a month and a half to nearly two months depending on the measure. Most of the uncovered losses were indirect: the profits lost while the business was closed.
For farmers' insurance, the evidence is more disappointing. A synthesis of randomized trials published in 2016 by the Agricultural Technology Adoption Initiative (ATAI) shows that at market price, agricultural index insurance (triggered by a measure such as rainfall, rather than by assessing each loss) attracts about 16% of farmers, and only 38% with a 50% subsidy. The synthesis judges these products not commercially viable on their own, and sees more promise in insuring institutions or groups that already pool their members' risks.
The lesson for your club is twofold. Your club does not sell insurance. But the lender it will work with after a disaster (Chapter 6) is best chosen beforehand. MERS recommends that financial institutions have written crisis procedures reviewed every year, off-site data backup, and liquidity management, because in a crisis clients save less, withdraw their savings and miss payments. A partner that has all this, and insures its portfolio, will be better placed to do what Fonkoze did.
4. Building on social protection¶
On September 18, 2017, Hurricane Maria strikes Dominica. According to the government's Post-Disaster Needs Assessment, it leaves 31 dead and 37 missing, directly affects 65,000 people, and causes damage and losses equal to 226% of 2016 gross domestic product. For the first few weeks, aid comes in kind. From mid-October, as markets gradually revive, the Ministry of Social Services prepares the switch to cash with the World Food Programme (WFP) and UNICEF.
The emergency cash transfer program starts in early December 2017 and reaches nearly 25,000 people, including 6,000 children: $90 per household per month, plus $50 per child for up to three children, in three payments. It does not build a new channel. It runs through the existing public assistance program, whose beneficiaries receive a top-up, and temporarily extends it to newly and severely affected households. In most villages, a five-person committee (the village council chair or secretary, community leaders, respected residents) lists the households and proposes the beneficiaries; the village councils hand out the payments. The setup has its limit: households that were not already in the public program did not receive their first payment until January or March 2018, four to six months after the hurricane.
A toolkit published in 2018 by Oxford Policy Management describes five ways to use social protection when a shock hits an entire population: adjust program design; piggyback on one element of an existing program (a list, a payment channel) for a separate response; temporarily increase benefits for existing beneficiaries (vertical expansion); temporarily add beneficiaries (horizontal expansion); align humanitarian and government interventions. It observes that in the successful examples, horizontal expansion had been built into the program design, not added after the disaster.
A club will not expand a public program. But alignment is within its reach. This book recommends that, in calm times, you know which public or Red Cross program exists in your area, who runs it, how it pays and on what criteria. After the disaster, if your club funds transfers or grants, aligning its amounts and criteria with those programs avoids gaps between neighbors and makes the handover easier (Chapter 14).
5. Knowing the anticipatory action in your area¶
Forecast-based financing, as the International Federation of Red Cross and Red Crescent Societies (IFRC) describes it, uses weather forecasts and risk data to define early actions, funded automatically as soon as a threshold agreed in advance is reached. It rests on a "no regret" principle: communities benefit from the actions even if the forecast hazard does not happen. Setting it up takes time: twelve to thirty-six months, according to the IFRC.
In Mozambique, during the 2023-2024 El Niño drought, the national anticipatory action plan was activated in nine districts, implemented by the national social action institute as part of the public social protection program. A qualitative WFP study based on thirty interviews shows both sides of the result. The indicators measured at the end of the program were better than at the start, but they had also improved among non-beneficiaries, and the people interviewed felt that the aid had mostly filled a three-month gap in their harvests rather than softened the drought. They asked for farm inputs: hoes, fertilizer, hardier seeds, irrigation.
The agencies that fund anticipatory action publish return figures, for example "up to" seven dollars in avoided losses and benefits for every dollar invested, according to a ten-country study cited in 2025 by the Food and Agriculture Organization of the United Nations (FAO), the Office for the Coordination of Humanitarian Affairs (OCHA) and WFP. These figures come from very different methods and from an advocacy brochure: do not add them up, and do not present them as an average. The Bangladesh study states more soberly what we know: anticipatory action protects assets and prevents debt; in that case, it did not speed up the return to work.
For your club, the conclusion is the same as for social protection. Do not create a parallel system. Find out whether the Red Cross, WFP, FAO or the government has a protocol in your area, and look for what it does not cover: in Mozambique, the farm inputs the beneficiaries were asking for.
What the club does in calm times¶
None of the documents read for this book describes an economic preparedness program run by a Rotary club. What follows is therefore a proposal of this book, built from the sources of this chapter and the earlier ones.
| Area | What the club does | Where the book covers it |
|---|---|---|
| Know your economy | area diagnosis, analysis of key markets | Chapter 3; CED guide, ch. 3 |
| Know your merchants | list of businesses, contacts, associations | Chapter 3 (Joplin) |
| Choose your financial partners | lender with a crisis plan, savings groups | Chapter 6 |
| Push business continuity | ask your suppliers, help them write a plan | this chapter |
| Know the public programs | social protection, early action protocols | this chapter |
| Keep the district ready | qualification, reports up to date, disaster committee | Chapters 10 and 11 |
| Keep the recovery file | lessons from the last disaster, contacts | Appendix B |
Know your economy beforehand. The Pre-Crisis Market Analysis (PCMA) guide, published by the International Rescue Committee (IRC), Oxfam and the United States Agency for International Development (USAID), puts it in one sentence: with a description of markets in normal times, there is no need to redo a full assessment after the shock, only a quick update of a few key indicators. The same guide recommends collecting data in the season when disasters strike, and counts the relationship built with merchants among its goals. This is the work the CED guide describes as the area diagnosis, done with an eye on risk.
Know your merchants. The Joplin Chamber of Commerce, which had a disaster plan in place, visited the 530 affected employers in three weeks (Chapter 3). In the case study devoted to it in the Canadian economic recovery toolkit, its president recommends, among other things, collecting local business owners' cell phone numbers in advance, since the usual networks may go down. An up-to-date list of the businesses in your area, their managers, and how to reach them when the usual networks fail is the first tool of a rapid assessment.
Keep the district ready. The July 2026 global grant Terms and Conditions are clear: the Foundation approves no new application from a sponsor that has an overdue report on any grant. A district that is not qualified, or one of whose clubs is late with a report, loses months just when they matter most. In Nepal in 2015, District 3292 already had a relief fund committee under its bylaws, and built its program on it. The disaster guide (Chapters 7, 9 and 11) describes the inventory of the club's assets, the activation of its networks, and its emergency fund.
Keep the memory. The next disaster may find a different president, a different governor, different members. The recovery file this book has built, chapter by chapter, is also your club's memory: what worked, what failed, who helped, at what cost. The disaster guide (Chapter 25) describes how to debrief; this chapter asks you to keep the result where the next committee will find it.
The traps¶
| Trap | Why it happens | Countermeasure |
|---|---|---|
| Thinking preparation replaces recovery | early money seems enough | plan for both; Bangladesh: 46 days without work |
| Confusing a continuity plan with prevention | the plan is reassuring | add risk reduction to the plan |
| Presenting savings as insurance | the groups are useful | state the limit when a shock hits everyone |
| Creating a parallel system | the club wants a visible Rotary project | align, fund what others do not cover |
| Adding up anticipation returns | the figures get passed around | cite the source and the words "up to" |
| Leaving preparation to the disaster committee alone | it is their topic | involve members who run businesses or banks |
| Forgetting the lessons of last time | presidents change | a file handed from one presidency to the next |
What your club now has in hand¶
This chapter adds the last piece to the recovery file: the club's economic preparedness plan. It states which activities and markets your area cannot afford to lose, who the merchants are and how to reach them, which financial partner will step in and whether it has a crisis plan, which public or humanitarian programs exist and how your club will align with them, where the district stands (qualification, reports, committee), and where the memory of the last disaster is kept. Appendix B gives the template.
In Bangladesh, in 2020, a few dozen dollars paid two days before the water saved tools and herds, but not the weeks of lost work. What those families kept, they kept because someone had prepared everything long before. What they lost had to be restarted afterward. Your club is built for both: preparing during the calm and, when disaster comes, getting the local economy moving again with the people who live in it.
Checklist¶
- The area's critical activities and markets are described in normal times, in the disaster season
- A list of businesses, their managers and their contacts is kept up to date
- Club members have asked their suppliers whether they have a continuity plan, and offered to help
- The continuity plans the club supports include a prevention component, not just restarting
- Savings groups are encouraged, without being presented as insurance against disaster
- A local financial partner is identified, with written crisis procedures
- The area's public social protection programs and early action protocols are known, with their criteria and payment channels
- The district is qualified, has no overdue reports, and has an active disaster committee
- The recovery file from the last disaster is stored where the next committee will find it
- Every grant-funded preparedness project has the approval of the relevant authorities
Further reading¶
- United Nations, Sendai Framework for Disaster Risk Reduction 2015-2030, 2015, Priority 4 and paragraph 36.
- United Nations Office for Disaster Risk Reduction (UNDRR), Reducing Risk and Building Resilience of SMEs to Disasters, 2020.
- Oxford Policy Management, Shock-Responsive Social Protection Systems Research: Toolkit, January 2018.
- Clemens Gros and coauthors, "Effects of anticipatory humanitarian cash assistance to households forecasted to experience extreme flooding: evidence from Bangladesh," Hydrology Research, vol. 54, no. 11, 2023.
- IRC, Oxfam and USAID, Pre-Crisis Market Analysis (PCMA), revised edition, February 2016.
- SEEP Network, Minimum Economic Recovery Standards, 3rd edition, 2017, chapter on financial services.
- The Rotary Foundation, Areas of Focus Policy Statements and Community Economic Development Guidelines: Global Grant Funding, April 2024.
- The disaster guide, part on preparedness (Chapters 3, 7, 9, 10 and 11); the CED guide, Chapter 3 (economic diagnosis of your area).