- Written by FREEMAN ROGERS and CONOR KING DEVITT
- Published: 12 October 2017
In recent weeks, estimates of Hurricane Irma’s cost to the Virgin Islands have ranged from $500 million to $4.5 billion.
Now Premier Dr. Orlando Smith has added another number to the mix.
Citing “preliminary assessments,” he estimated during a Thursday afternoon address that Irma’s damages amounted to around $3.3 billion.
Dr. Smith did not provide details of how that number was reached, but he explained, “My administration has had several meetings to discuss the cost of the territory’s rebuild and how it will be financed.”
The premier is the latest of several public officials and private sector players who have floated figures approximating the storm’s price tag.
“If we look across Dominica, Barbuda, Turks and Caicos, British Virgin Islands, Anguilla — the islands and territories affected worst — I have no problem going out on a limb and saying that’s a $1 billion project over time in each of those islands,” Stephen O’Malley, the United Nations resident coordinator for Barbados and the Organisation of Eastern Caribbean States, said in a press conference last week.
Homegrown estimates have been much higher than Mr. O’Malley’s.
“A conservative estimate for the restoration of the British Virgin Islands to pre-Irma economic growth is $4 billion,” wrote Lorna Smith, interim director of BVI Finance Limited, in a recent letter circulated to the financial services community.
Ms. Smith also said it would cost government $48 million to restore power throughout the territory by the end of December, though she provided no citation for either estimation.
Last month, Sir Richard Branson provided a similar estimate to CNN, saying that the cost of rebuilding the VI would be $3-4 billion. He didn’t say how he arrived at those numbers.
The science of cost
Adam Smith, a physical scientist at the United States’ National Oceanic and Atmospheric Administration, recently broke down the elements of how the official price tag of a natural disaster is assessed.
In an interview with ResearchGate, an academic social media site, Mr. Smith said the figure includes physical damage to residential, commercial, and public buildings; damage to material assets within buildings; time element losses like businesses interruptions; and damage to vehicles, boats, offshore energy platforms, public infrastructure, and agricultural assets.
“However, these loss assessments do not take into account losses to natural capital/assets, health care-related losses, or values associated with loss of life,” he told ResearchGate. “Therefore, the estimates should be considered conservative with respect to what is truly lost but cannot be completely measured.”
The loss estimates are calculated using input from insurance companies and government agencies and must take into account damage to uninsured or underinsured assets, the scientist explained.