Investing in resilience: Innovative finance for drought preparedness

The policy brief demonstrates that enhancing resilience is one of the most cost-effective actions countries can take, and is typically far less expensive than interventions focused on responding to, and recovering from, the impacts of droughts, but innovative financing mechanisms are essential to fund the necessary long-term investments.

According to the brief, sound economic evidence is essential for decision- and policy-making. An investment of USD 1.8 trillion in resilience and adaptation, focused on five priority areas from 2020 to 2030, could generate USD 7.1 trillion in total net benefits. Also, for every USD 1 spent in building resilience there could be up to USD 3 in benefits from reduced need for humanitarian aid and avoided losses.