Financing Disaster Risk Reduction- A 20 year story of international aid

This moment, with so many policy debatesconverging on 2015, represents a unique opportunityto ensure that disaster risk reduction (DRR) becomesa truly fundamental component of development andpoverty reduction. The international financing ofDRR, representing the international community’ssupport to national governments in their efforts toprotect development gains from disasters, is comingunder increasing scrutiny.This report examines the record of the internationalcommunity to date, investigating the priorities infinancing of DRR, and asking questions of both theequity and adequacy of past efforts. Beyond thisit points to the future of a more rational, targetedinvestment in risk reduction.The evidence of the 20-year trends in internationalDRR financing is worrying:● Financing has been highly volatile; only in thepast few years has there been relative stability.● Although $13.5 billion of financing has beenmade available, it is a fraction of overall aid, lessthan 40 cents in every $100.● Disaster losses in developing nations amountto $862 billion (a considerably under-estimate)– equivalent in value to one-third of allinternational development aid.● There is a high concentration of funding in arelatively small number of middle-income countries.The top ten recipients received nearly $8 billion, theremaining 144 just $5.6 billion combined.● Financing is considerably fragmented. The 3,188projects that cost less than $1.5 million represent86.5% of the total number but only for 5.5% ofthe volume of financing. The administrative costsof this have not been calculated.● Many high-risk countries have received negligiblelevels of financing for DRR compared withemergency response; 17 of the top 20 recipientsof response funding received less than 4% of theirdisaster-related aid as DRR.In addition, the priorities of international financingare, on the whole, not matched to either the needs orcapacity of recipient countries:● There is some correlation between mortality risklevels and volumes of financing, but only at thehigh-risk level.● Per capita financing reveals significant inequity.Ecuador, the second highest recipient per capita,received 19 times more than Afghanistan, 100times more than Costa Rica and 600 times morethan the Democratic Republic of Congo (DRC).● Where the economy is at risk, volumes offinancing tend to be high; where predominantlypopulations are at risk, volumes are often low.● Financing in drought-affected countries is veryweak. Niger, Eritrea, Zimbabwe, Kenya and Malawihave seen 105 million people affected by drought,but their combined DRR financing has been $116.5million, the same as Honduras alone.● Financing does not take into account nationalcapacity and finances. Twelve of a group of 23low-income countries each received less than$10 million for DRR over 20 years. Thesesame countries received $5.6 billion in disasterresponse, equivalent to $160,000 for every $1of DRR.There are positive areas to build upon, includingrelatively stable financing in the past few years; lessfinancing of heavy infrastructure; a move away fromricher middle-income countries; and increasing DRRfinancing from climate adaptation. There should,however, be considerable caution given the pressureson traditional funding sources, and sustained concernfor the high numbers of low-income, sub-SaharanAfrican countries, often severely affected by drought,that have seen minimal international DRR financing.The data available for tracking the financing of DRRis not as good as it should be. Both broad picturesand individual country detail are needed, and toobtain this data improvements are urgently required.We also need to better understand national financingof DRR, and the interplay between national andinternational sources.Despite issues with data, the evidence drawn togetherin this report strongly suggests that the internationalcommunity must take stock of the way it providessupport to national governments. Questions need tobe asked about the role of international financing,the funding architecture and how funds from othersources can be brought to bear. Above all else, there isa need to move towards gauging the effectiveness ofwhat has been spent.The future therefore is not just about moremoney from donor governments, but also aboutbetter financing – more integrated and suitablycoordinated, and certainly better targeted.