Launch of the Global Assessment Report 2025 on Disaster Risk Reduction

The Global Assessment Report (GAR) 2025, published by the United Nations Office for Disaster Risk Reduction (UNDRR) and titled, Resilience Pays: Financing and Investing for our Future, shows disaster risk is increasing as more frequent and intense hazard events, unsafe urbanization, and ineffective development put more people and assets in harm's way. Disasters have profound macroeconomic impacts, with direct losses estimated at $202 billion. When cascading and ecosystem costs are taken into account, escalating disaster costs now surpass $2.3 trillion annually.

The report also highlights how smarter investment can reset the destructive cycle of disasters, debt, uninsurability, and humanitarian need that threatens a climate-changed world.

IIASA contributed with global analysis on fiscal risk showing how compound hazard risk leads to more frequently occurring fiscal crisis events. Concerningly, based on an analysis of disaster and economic indices, it suggests that for 61 vulnerable countries events significant enough to trigger a fiscal crises may occur more than every 10 years (an annual probability larger than 10%). The IIASA contribution goes further to underscore that this is not inevitable. It shows how having better access to finance and innovative disaster risk financing options can help stop this bifurcation between countries increasingly caught in a rapid cycle of disaster related fiscal crises and those able to develop more sustainably. Specifically, the study takes as an example, how countries’ reserve assets in the International Monetary Fund (IMF) (the Special Drawing Rights (SDR)) can soften the impact of disasters as proposed internationally by the Bridgetown Initiative to reform the global development and climate finance architecture.

Such an investment in risk reduction would thus have a massive development dividend in terms of fiscal and economic stability, solid credit ratings, access to finance and thus enhanced government capacity to support the most vulnerable communities and households.