Hurricanes Eta, Iota Hit Nicaragua With $743 Million In Economic Losses

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Nicaragua suffered more than $740 million in damage from Hurricanes Eta and Iota, the government said on Tuesday, as the Inter-American Development Bank (IDB) promised $1.7 billion in aid for millions of people affected across Central America.

Nearly 44,000 homes experienced total or partial damage in Nicaragua, said Nicaraguan Finance Minister Ivan Acosta, estimating the storms had cost the country $743 million in losses, according to government media site El 19.

Hurricane Eta alone affected some 3 million people in seven Central American countries and caused up to $5.5 billion in damage, the IDB said, citing estimates from the United Nations Office for the Coordination of Humanitarian Affairs (UNOCHA).

A spokeswoman said UNOCHA could not confirm the figure and that evaluations were continuing in the field.

Iota’s economic toll had yet to be calculated, said the IDB.

The region was still recovering from deadly flooding and mudslides triggered by Eta when Iota walloped Central America.

The IDB said on Monday it would support reconstruction in the hardest-hit countries with up to $1.2 billion in new funds, plus up to $500 million reassigned from existing operations and money mobilized from other institutions working in the region.

IDB President Mauricio Claver-Carone, who took office on Oct. 1, told Reuters on Tuesday that he was seeking to expand the capital base of the bank and make it a more powerful force in the region.

Claver-Carone, the first U.S. national to head the bank and a former aide to U.S. President Donald Trump, faced opposition from some of Latin America’s leading economies when he ran for the job earlier this year.

He said an IDB study of more than 250 natural disasters between 1970 and 2008, published in the Review of Development Economics, showed disaster aid typically fell short of what was needed.

“History shows that aid to countries that have suffered natural disasters has typically covered only about 3% of the total estimated economic damage from the disasters. That’s nowhere near enough. We’re going to do things very differently,” Claver-Carone said.

The Honduran central bank said on Monday that devastation caused by Eta would shave an additional percentage point from economic growth, which along with the fallout from the coronavirus pandemic would lead to a record contraction of 8 to 9% in 2020.