Rethinking Flood Protection Through a ‘No-Regret’ Lens

Flooding has become a global development challenge, accounting for approximately 35–40 per cent of recorded weather-related disasters. Asia, particularly Southeast Asia, is home to many of the world’s major flood-risk hotspots. The Philippines ranks first in the 2025 WorldRiskIndex, while a separate assessment ranks Vietnam third and Myanmar fifth globally. The economic consequences are substantial: Vietnam experiences average annual losses from climate-related disasters of around USD 2.4 billion (approximately 0.8 per cent of GDP), while the Philippines faces expected annual flood damage of approximately USD 625 million.

Despite governments’ funding constraints across much of Southeast Asia, major flood-protection investments continue where resources allow. Indonesia, for example, is implementing its USD 400 million National Urban Flood Resilience Project. Yet where flooding persists or projects face delays, questions can arise about how such investments perform and how their value should be judged.

Governments and policymakers often assess flood-protection investments using economic appraisal methods, like those applied to other major infrastructure projects. Unlike roads and bridges, however, flood protection creates value differently. A floodwall does not generate direct revenue, nor a drainage system profits. Instead, much of its value comes from avoided losses: homes that remain dry, businesses that continue operating and disruption that does not occur. Insurance data and catastrophe-risk modelling can help quantify some of these, but the value can extend to broader social benefits. Flood protection’s primary purpose is not to create new wealth, but to protect existing wealth and reduce future losses.

This creates a “mindset of regret”: when flooding exceeds a system’s design capacity, the investment may be questioned; when the system performs successfully, the avoided disaster remains largely invisible. The dilemma is particularly relevant in Southeast Asia, where governments face competing demands for limited public resources while confronting rising flood risk. Large flood-protection investments compete with other development priorities. Successful flood protection often lies in damage and disruption that do not occur.

This invisibility has financial consequences. Across Southeast Asia, governments may find it hard to prioritise preventative flood investment. More broadly, public expenditure continues to favour post-disaster recovery over pre-disaster mitigation and prevention, while conventional cost-benefit assessment can struggle to capture avoided losses, adaptive flexibility and long-term resilience. Without dedicated revenue streams or public guarantees, flood-protection projects may be less attractive to commercial lenders.

Instead of waiting for precise forecasts, governments can ask whether an investment provides value today while remaining robust and adaptable across multiple plausible futures.

These constraints do not excuse poor performance. Flood defences must meet rigorous engineering and operational standards, but governments must communicate what these systems are designed to achieve and what they cannot. Flood protection should not be judged by whether flooding disappears entirely, but by how much risk and loss it reduces.

The challenge is not simply to build better flood defences but to judge them differently, which becomes more difficult as climate change makes future flood conditions harder to predict. Governments must make long-lived decisions before knowing precisely how rainfall, sea levels, urban development or exposure will change. Waiting for certainty may itself become a risk.

Climate-adaptation research offers a different perspective through the concept of “no-regret” decision-making. The “no-regret” concept is well established in the literature, while its application to flood-defence planning is more recent. Broadly, a no-regret investment delivers benefits under current conditions while remaining valuable across future scenarios. That is, an investment should still provide value even if the more severe climate impacts anticipated today do not materialise. For flood protection, that value might come from reducing existing flood risk, improving drainage and infrastructure reliability, or providing co-benefits like public space, ecological improvement or other community uses.  

This changes how uncertainty is treated. Instead of waiting for precise forecasts, governments can ask whether an investment provides value today while remaining robust and adaptable across multiple plausible futures. This matters because flood-defence effectiveness depends on more than engineering. Rapid urbanisation, land-use change and inadequate maintenance can increase flood risk even when protective infrastructure performs as intended. Flood-defence planning intersects with housing, transport, environmental management and economic policy. Political and budget cycles are short, whereas flood defences may protect communities for half a century or longer. No-regret thinking shifts attention from short-term visibility towards whether investments reduce vulnerability, remain adaptable and continue delivering benefits under different futures.

Examples elsewhere show what this can look like in practice. The Netherlands’ Room for the River programme combines flood-risk reduction with improvements to spatial and environmental quality. This does not provide a blueprint that Southeast Asian countries can simply replicate, particularly given major differences in land availability, governance and financing, but illustrates how flood investment can be designed in a “no-regret” manner.

The issue is intergenerational. Delaying investment may reduce expenditure today but increase future adaptation costs and transfer greater risks to future generations. Flood protection should be treated not as a one-off expense, but as a continuing public commitment to resilience.

Policy Implications

Putting this mindset into practice requires changes in how flood protections are planned, valued and governed. First, flood defences should be maintained and upgraded with long-term societal resilience as an objective, requiring institutional continuity, sustained maintenance and flexibility as risks evolve. Second, conventional economic appraisal should inform decisions, but not determine them. No-regret planning should consider outcomes that are difficult to monetise, including community safety, continuity of essential services, preparedness for future climate extremes and confidence that protective systems can adapt as risks change. Where flood defences provide social, environmental or recreational benefits, these can strengthen the case for investment. Finally, flood defences must be coordinated with land-use planning, urban development, drainage and broader climate adaptation. Higher floodwalls cannot reduce risk if the surrounding development increases exposure.

These principles extend beyond Southeast Asia. Governments everywhere must make infrastructure decisions today for climates that cannot be predicted with certainty. A no-regret approach’s broader purpose is to ask whether those decisions will strengthen societal resilience, preserve options and leave communities better prepared across different possible futures.

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