UN – Financing for Development Must Include Risk Planning

A recent conference on the critical role of risk and resilience in Financing for Development (FfD) has concluded development must be risk-informed to be sustainable.

“Volatility is the new normal”, says Jo Scheuer, UNDP’s Director for Climate Change and Disaster Risk Reduction. Development and humanitarian spending, which has reached close to $20 billion a year, can no longer be financed as “business as usual”. Financing for development needs to acknowledge the threats posed by natural disasters such as floods, climate change and conflict.

The conference took place on 15 June 2015 and was hosted by the Swiss Government and United Nations Development Programme (UNDP).

Amongst the key messages was a plea for all investors, public and private alike, to ensure sufficient recognition of risks and to amend investments accordingly. Experts also noted the seemingly intractable rise of humanitarian spending, which has reached close to $20 billion a year, and urged all stakeholders to invest more time and resources in sustaining development gains before a crisis strikes. This is especially important in light of the threat of climate change.

“There is a disjoint between the way we plan and finance development and the realities of the world we live in,” noted Jo Scheuer, UNDP’s Director for Climate Change and Disaster Risk Reduction in the Bureau for Policy and Programme Support.

“Volatility is the new normal; the Financing for Development Conference is a rare opportunity to entrench the notion that development must be risk-informed to be sustainable.”

The high-level event followed a technical workshop held on 28 May that brought together twenty external policy experts to discuss challenges to development financing. That workshop was designed to articulate a vision for resilience and ensure adequate financial attention is paid to tackling shocks and stresses, such as the earthquake in Nepal and the Ebola outbreak in West Africa, that adversely impact development and undermine progress.

Key messages from the workshop and high-level event will next be carried forward to the Financing for Development Conference (FfD), which will run from 13-16 July in Addis Ababa, Ethiopia, and will hopefully influence the FfD Outcome Document. For its part UNDP has been working with Member States and partners to ensure that the FfD, as well as parallel post-2015 processes, are used to strengthen development and enhance resilience at all levels.

malawi floods 2015
Flooding in Malawi –
Aerial view of floods.
Photo: George Ntonya/UNDP