A $278bn Funding Gap: Who Will Pay for Water Security?

The world is facing a severe drought crisis, with alarming consequences for agriculture and global food security. Governments are convening to address the issue, but the core question of who will fund the necessary water security measures remains unresolved.

The price of inaction is mounting. The gap between what is needed for land restoration and drought resilience, and what is currently allocated, is substantial. This shortfall demands a broader financial commitment.

With global temperatures rising and rain patterns becoming more unpredictable, the private sector's role in shoring up water supplies is becoming critical. However, current private investment levels are a fraction of what is required, raising questions about how to mobilise capital effectively.

## The Drought Finance Gap

The UN has estimated that $355bn a year is needed to restore land and build drought resilience. However, at the moment, only $77bn is being directed towards related initiatives and interventions, leaving a significant funding gap of $278bn.

Governments alone will not be able to foot the remaining $278bn, and the private sector will play a key role in building water security. The private sector's contribution to drought resilience and land restoration is currently around 6%, and it is essential to shift existing financial attitudes to make investing in resilience now more appealing than waiting to pay for the damage later.

## From Response to Resilience

UNCCD Executive Secretary Yasmine Fouad has emphasized the importance of taking action to address land degradation and drought. She has stated that COP17 must be a COP of implementation, where the world mobilizes the political leadership, investment, and partnerships needed to move from commitments to measurable results on the ground.

The main UNCCD mechanism for private sector engagement is Business4Land (B4L), which supports companies in setting targets, adopting sustainable practices, and disclosing their impacts on land, soil, and water. Next week, the Business For Land Forum will take place, providing an opportunity for governments, businesses, and investors to collaborate and accelerate private-sector action and investment in regenerative landscapes.

## Investing in Water Security

Businesses need to treat water security like the critical bottom line issue it is. Investing in a more water-secure world means investing in the longevity of a business' operations. This can be achieved by improving water efficiency and reuse, supporting soil health, scaling regenerative agriculture, strengthening national water infrastructure, or improving drought warning systems.

Even if national governments can't come to a consensus at this COP, companies can't afford to wait. The consequences of inaction will be severe, and the private sector must play a critical role in building water security.