Droughts are having increasingly significant economic impacts. A new report shows that without effective adaptation, the costs associated with climatic events could surge by at least 35% by 2035.
The global land area affected by drought has doubled since 1900. In recent decades, nearly 40% of the planet experienced increased frequency and intensity of droughts. Rising temperatures are intensifying evaporation, reducing soil moisture, and compromising aquifer replenishment. Under a 4°C global warming scenario, droughts could become up to seven times more frequent and intense.
This phenomenon will impact everyone. In general, poorer regions suffer more severe social consequences, including hunger and forced migration, but high-income countries will also face heavy losses. The 2021 US drought, for instance, resulted in over $1.1 billion in agricultural damage. Similarly, Europe's 2022 summer brought about approximately €40 billion in losses.
Sixty-two percent of monitored aquifers worldwide are showing sustained declines which indicate ongoing overextraction and compromise medium-term water security. Furthermore, soil degradation, reduced plant productivity, and deterioration of ecosystem services are exacerbating this issue. Climate models project increased drought risk and generally indicate declining river flows and water tables for many regions.
Against this challenging backdrop, proactive action is essential. The report proposes a preventative framework to address these challenges that promotes integrating public policies, soil restoration, reorienting agricultural practices, and redesigning cities to help build real resilience.
Investing in adaptation can offer substantial economic returns. It not only reduces direct impacts, it also yields sustained economic benefits. For every dollar invested in prevention, benefits can multiply by three. In some cases, returns can be tenfold.
