Catastrophic natural disasters have served as reminders of the connection between fragile governments and human losses. Developing economies are impacted most from natural as well as anthropogenic hazards. For example, the Indian Ocean tsunami (2004) claimed 227,898 lives, primarily in three politically fragmented countries with developing economies: Indonesia, Sri Lanka, and India; and the 2010 Haiti earthquake affected more than 3 million people and killed between 46,190 and 316,000. According to EM-DAT, the cumulative number of global disaster deaths over the past 30 years was 1,677,000, with an annual average of 54,082 deaths. According to Swiss reinsurance companies, the average global natural disaster insurance loss for the last 10 years (2009–2018) was $67 billion, and global insurance losses accounted for 0.09% of global GDP on average. Over the past decade, “natural” disasters have caused more than 780,000 fatalities and destroyed physical properties worth a minimum of $960 billion.
The United Nations International Strategy for Disaster Risk Reduction (UNISDR) initiated the international disaster governance agenda for the Hyogo Framework for Action (HFA) global blueprint in 2005 and the Sendai Framework for Disaster Risk Reduction (SFDRR) in 2015. Since the HFA, the international disaster risk reduction (DRR) community is increasingly viewing disaster risk management (DRM) as a governance concern.
Governments are not a single structure; they are divided into various functions, hierarchies, policies, and responsibilities in working to create resilient communities at various levels (national and subnational). In countries with developing economies, government agencies have a significant role in DRM, which includes community-based organizations, science and technology research institutes, environmental protection agencies, and finance ministries. The existence of disaster management systems able to integrate vertical and horizontal coordination efforts is a critical weakness. Although there has been significant improvement globally in government capacities as well as institutional frameworks and legislative provisions for DRR in recent years, progress has been uneven. National-level policy
formulation in a top-down model has often not made a significant impact at lower levels of government, where awareness-raising, training, and capacity-building likely would be significantly addressed. An extensive literature review is provided to help understand decentralized governance and its efficacy for local-level risk management of natural hazards for developing economies. Community risk perceptions and ways to respond to disasters vary from location to location; thus, it is important to implement decentralized policies and customize them to local needs and priorities to achieve low-impact sustainable development.