The report, released last month by the McKinsey Global Institute, the research arm of U.S. consulting firm McKinsey & Company, warns that the southern metropolis’s economic growth and infrastructure expansion plans could be incompatible with the need to mitigate its flooding risks.

"The metropolis of Ho Chi Minh City can survive its flood risk today, but its plans for rapid infrastructure expansion and continued economic growth could, if not managed carefully, lead to an increase in risk," it says.

It notes that rapid urbanization brings about a reduction in permeable surfaces and increases the risk of land subsidence, and can cause changes that increase exposure to flooding.

As demand for land in urban areas increases, development in higher flood risk areas is encouraged. Combined with ongoing effects of climate change, the destructive power of flooding from weather events and rising seas and rivers could increase, especially for urban areas in coastal and riverine environments, the report says.

Using hydrological simulations, land use maps and infrastructure databases, the report simulates and examines the expected impacts of flooding on Saigon in three scenarios: today, in 2050 and a longer-term worst-case scenario of 180 cm of sea-level rise. The report defines an extreme flood, or a 100-year flood, as a flood event with a 1 percent chance of being equaled or exceeded in any given year.

In the first scenario, an extreme flood would deliver a disruptive but likely manageable impact on Saigon’s existing infrastructure. Around 23 percent of the city could flood, bringing down a range of existing infrastructure assets, including ports and power stations. Direct inundation would reduce hours worked, cause outages, cut off water supply and render roads inoperable, the report says.

Infrastructure damage in such a scenario may total up to $300 million, while knock-on effects could increase damage to $400 million. Most expected damage however is in real estate, which may total $1.5 billion, the report added.

In the second scenario, a similar flood would likely do three times the physical infrastructure damage and deliver 20 times the knock-on effects in 2050. Around 36 percent of the city could be flooded, and the resultant damage could go as high as $1 billion. Damaged assets could include new metro stations, data centers, wastewater facilities, power stations, substations and ports. Roads would begin to reach damage thresholds, with at least 10 percent requiring repair. About $8.5 billion of damage could also be incurred on real estate as larger areas flood to greater depths. Moreover, increased economic reliance on assets in flooded areas would amplify knock-on effects, resulting in up to $8.5 billion in losses.

Widespread disruption to new and existing infrastructure could be expected for weeks, as the metro closes lines and partially shuts down, leaving around one million daily commuters to suffer. Affected transformers in the city could increase localized blackouts, and damage to wastewater processing plants could cause up to 10 million gallons of sewage to overflow into the city. Water supply could end up being cut, the report says.

Bleaker still

In the final scenario, extreme flooding caused by a 180-cm sea level rise, could occur by the end of the century without significant actions to mitigate climate change, increasing the flooded area by three times and the depth by seven times over current levels, inundating 66 percent of the city. The city center would then become a temporary island, with critical and widespread infrastructure damage totaling up to $7.3 billion.

Infrastructure damage could include significant percentages of data centers, wastewater processing plants, power stations and ports. Half the roads would exceed the repair threshold, a quarter of metro stations could be damaged, and as many as 60 percent of them may be inoperable or inaccessible. Real estate damage could total $18 billion.

With much of the city’s functionality being shutdown, damage from knock-on effects could go up to $45.1 billion. With so many stations inoperable or inaccessible, the metro would almost certainly be shut down, disrupting as many as three million daily commutes. Wastewater plant failures would increase the volume of sewage overflows, potentially spilling up to 50 million gallons of sewage into the city. A full blackout is possible as the proportion of inoperable substations approaches 50 percent, and water supply would likely be cut off to the entire population for the duration. Impacts of the city shutting down in such a scenario could last for a month or more, the report says.

As bleak as impacts of an extreme flood could be, such floods would be infrequent. Intensifying floods as a chronic occurrence would have a greater effect on the economy, with mounting annual burdens over time, the report says. Today, annual flood-related impacts in Saigon may amount to about $1.3 billion a year, predominantly from real estate damage, but this can continue to rise and eventually overwhelm Saigon’s economic growth, reaching up to $8.7 billion by 2050, or 3 percent of the city’s GDP, the report says.

It notes however that the southern metropolis has time to adapt, with measures including better positioning of new assets to minimize flooding impacts, while economic realignment towards a service economy may reduce reliance on larger industrial real estate in more vulnerable areas.

Measures to improve asset resilience against floods include better maintenance of dikes and drainage systems, tightening building codes to make them withstand floods better, as also natural ones such as planting mangroves to offer additional protection from extreme weather events.

The poorer portions of the population lose the most in flood conditions. Those in lower-income professions such as dock working and agriculture, for instance, experience greater flooding impacts due to the need to be close to the water. These population segments struggle to recover following flood exposure. Poorer Saigon areas also have lower-quality, unregulated housing that gets damaged more severely in floods. As such, financial mobilization measures, including fund raising, should be utilized to improve infrastructure towards mitigating disruption and damage from floods.

Saigon, home to around 13 million people, is no stranger to flooding, with parts of the city and the Mekong Delta having sunk by up to 81.4 cm over the last decade, according to the Ministry of Natural Resources and Environment. Another study by the environment ministry in 2016 estimated that a rise in sea level of one meter by 2100 would potentially flood about 18 percent of Saigon and 39 percent of the Mekong Delta.