Disasters are increasingly expensive and their impacts underestimated. The Global Assessment Report on Disaster Risk Reduction (GAR) 2025, highlights how direct disaster costs have grown to approximately $202 billion annually, but that the true costs of disasters are over $2.3 trillion when cascading and ecosystem costs are taken into account. The burden of this cost- and the debt it creates- disproportionately falls on developing countries, but it doesn’t need to be this way.
Published by the United Nations Office for Disaster Risk Reduction (UNDRR), the GAR 2025 report titled “Resilience Pays: Financing and Investing for our Future,” outlines how aligning investments with risk realities can break spirals of debt, uninsurability, and increasing humanitarian needs.
“This year’s Global Assessment Report on Disaster Risk Reduction examines the risks posed by disasters from now to 2050 and presents an indisputable case for action. It shows the eye-watering losses inflicted by disasters today, which hit vulnerable people the hardest. And it demonstrates that, on our current trajectory, costs will continue to mount as the climate crisis worsens. But it also illustrates that, by boosting and sustaining investment in disaster risk reduction and prevention, we can slow that trend and reap economic benefits – saving lives and livelihoods while driving growth and prosperity, to help reach our Sustainable Development Goals,” wrote António Guterres, the UN Secretary-General, in his foreword welcoming the report.
The report outlines how the effects of increasing disaster costs are already being felt around the globe, from the emergence of areas deemed too risky for insurance companies to cover, to growing national debts, and recurring humanitarian crises.
However, it also presents case studies and policy recommendations for how investments in resilience can help stop the growing economic cost of disasters, reduce humanitarian needs, and make scarce international assistance resources even more effective.
“Systematic and greater investment in disaster risk reduction and resilience can not only arrest these trends but also reverse them. When riverbank communities have access to scientific tools for planning their land use, when they have resources for building flood protection systems, and when they have early warning systems, they not only reduce damages and losses from floods, but also create conditions for prosperity and sustainable growth in their communities,” said Kamal Kishore, Special Representative of the UN Secretary-General for Disaster Risk Reduction and the Head of UNDRR.
The findings of GAR 2025 are especially relevant ahead of the 4th International Conference on Financing for Development, and speak to specific options for enhancing multilateral finance to better protect smaller developing economies. The report also shows how the private sector can play a key role in reducing the economic damage of disasters and in filling the protection gap that leaves many countries in a worsening spiral of repeated disasters.
Increasing the quantity and quality of disaster risk reduction investments, in everything from early warning systems to critical infrastructure and schools, will be a focus of many of the discussions at the Global Platform for Disaster Risk Reduction, which UNDRR is convening from 2 to 6 June, and is hosted by the Government of Switzerland in Geneva.
