The present report was informed by the work of the Intergovernmental Working Group on Drought under the United Nations Convention to Combat Desertification (UNCCD), and its holistic approach with the other Rio Conventions, as well as the international sustainable development and disaster risk reduction communities. The publication builds on a recent review of drought risk mitigation, preparedness and response measures commissioned by FAO with partners in the Integrated Drought Management Programme, alongside a range of other recent global reviews, and the work of the Intergovernmental Working Group of the UNCCD on drought. The report presents an overview of current knowledge and thinking concerning the effectiveness of three distinct layers of financing that set out to address drought risks in different ways. For each of these, results are conceptualized and measured in different ways for disaster risk reduction, adaptation to climate change, and transformative green finance. There is not yet any coherent global system to generate an overview of progress and gaps at the global level, nor to orient public policies and learning processes within the affected countries. This initial review explores how these gaps could be filled. It also takes a first step toward doing so by bringing together insights from the current available systems for targeting and tracking financing to address drought risks through the three layers of actions, target indicators and evidence systems.

Although risk-based approaches to disaster management are particularly effective, the rapid start-up of risk financing is hardly conceivable in the case of a drought that has been grossly underfinanced. Even if existing resources are spent more effectively, the gap far exceeds the active finance flows. Creating an enabling environment for the financial sector is the first step to intensifying investments, and it must be done by aligning the interest of the involved actors, including public and private stakeholders, the development and scientific community, and the impacted sectors. This report provides an in-depth analysis of the structural particularities and the status of drought finance. It lines up pathways to stimulate the financial environment by proposing innovative strategies, in other words, enabling pathways. It responds to the pressing concern of what innovative instruments and strategies should be used to make drought finance attractive for all sectors. The goal is to roll out larger-scale programmes to enable drought financing to yield a good return, thus supporting the efforts of the global community to build drought resilience through increased finance flows.By providing pragmatic steps towards the acceleration of drought finance, the publication contributes to several Sustainable Development Goals (SDGs), including SDGs 1, 2, 5, 6, 13, 15 and 17. It is in line with the objectives of the FAO Strategic Framework, namely, it addresses the objective of the Better Production to ensure “resilient and sustainable agrifood systems”, and the objective of the Better Life to promote “inclusive economic growth by reducing inequalities”.

This publication (published in 2 volumes, not sold separately by TSO) is intended for people who have an interest in and practice disaster risk management and sustainable development. It provides guidance, policy orientation and inspiration, as well as serving as a reference for lessons on how to reduce risk and vulnerability to hazards and to meet the challenges of tomorrow. It consists of (vol. 1) the report, including case studies; and (vol. 2) annexes, for example, a glossary of specialized terminology , and a directory of international, regional, national and specialized organizations (vol. 2). It replaces the preliminary version which was released in July 2002 (not available from TSO).

Disasters damage and destroy infrastructure and disrupt economic activities and services, potentially delaying long-term development and hampering efforts to reduce poverty in the region. Countries require a strong enabling environment for disaster risk financing to ensure the timely availability of post-disaster funding. This report presents a comprehensive diagnostics tool kit that countries can apply to assess the financial management of disaster risk. The framework examines the state of the enabling environment and provides a basis to enhance financial resilience with insurance and other risk transfer instruments. It incorporates lessons from the country diagnostics assessments for Fiji, Nepal, Pakistan, and Sri Lanka that made use of the tool kit and methodology.

On top of a decade of exacerbated disaster loss, exceptional global heat, retreating ice and rising sea levels, humanity and our food security face a range of new and unprecedented hazards, such as megafires, extreme weather events, desert locust swarms of magnitudes previously unseen, and the COVID-19 pandemic. Agriculture underpins the livelihoods of over 2.5 billion people – most of them in low-income developing countries – and remains a key driver of development. At no other point in history has agriculture been faced with such an array of familiar and unfamiliar risks, interacting in a hyperconnected world and a precipitously changing landscape. And agriculture continues to absorb a disproportionate share of the damage and loss wrought by disasters. Their growing frequency and intensity, along with the systemic nature of risk, are upending people’s lives, devastating livelihoods, and jeopardizing our entire food system. This report makes a powerful case for investing in resilience and disaster risk reduction – especially data gathering and analysis for evidence informed action – to ensure agriculture’s crucial role in achieving the future we want.