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Adaptation and resilience: A priority for development and poverty reduction
This brief details the intersection between climate resilience and poverty reduction as well as existing opportunities for related projects. Climate change and disaster impacts disproportionately affect the poorest and most vulnerable populations, especially in low- and middle-income countries. They may cause 216 million people to migrate in their own country by 2050, and push as many as 132 million people into poverty by 2030. Climate change will affect food prices and food security, health, and labor productivity, and bring more frequent and severe floods, droughts, and storms. Investing in climate resilience presents an enormous economic opportunity: On average, $1 invested in resilient infrastructure yields $4 of benefits, with total net benefit of $4.2 trillion over the lifetime of new infrastructure assets in low- and middle-income countries. Similar opportunities exist in other sectors, with benefit-cost ratios larger than 4 for early warning systems, and 2–10 in other sectors.
The paper reports that national governments must spend better by mainstreaming adaptation and resilience. The World Bank's private sector investments, projects are screened for climate risks. Governments and the private sector must also spend more on physical resilience and adaptation. Mobilizing private finance is a key part of the effort to drive greater investment in resilience and adaptation. A core challenge with resilience investments is that, while large, the benefits typically come in the form of avoided impacts. This means they are not always visible or easy to monetize for those making the investment. Boosting social and financial resilience is also key for countries in regions like the Sahel to build shock-responsive adaptive social protection systems. Through an appropriate balance between prevention and preparedness, all countries can become less vulnerable to climate change impacts, and more resilient to all shocks or crises. This will be a major contribution to achieving more robust and sustainable development and rapidly eradicating extreme poverty.