Fiscal resilience to extreme events

The Risk, Policy and Vulnerability (RPV) Program pioneered numerous studies on the fiscal resilience of national governments to extreme event losses, a concept that has become increasingly topical as climate negotiators deliberate on a global fund to support adaptation.

© Kschua | Dreamstime © (c) Kschua |

© Kschua | Dreamstime

RPV and collaborators have suggested a global adaptation fund for extreme climate events in the most vulnerable countries, as shown in Figure 1. RPV estimated that the fund’s capitalization needs to be less than US$10 billion annually, which is well below the scope of the promised adaptation funding ($100 billion annually).

The figure shows the countries (red and orange) most vulnerable to disasters caused by natural hazards based on estimates generated by RPV’s CATSIM model which calculates fiscal resilience to major disasters. Fiscal resilience is measured by the risk event (probability and consequence) for which the government cannot raise sufficient post-disaster financing to fully repair damaged infrastructure and provide assistance (the fiscal gap) [1].

Figure 1. Countries most vulnerable to disasters (click on image to enlarge).


[1] Hochrainer-Stigler S, Mechler R, Pflug GC, Williges K (2014). Funding public adaptation to climate-related disasters. Estimates for a global fund. Global Environmental Change 25:87-96 (March) (Published online 28 February).


Munich Re, Germany

GermanWatch, Germany

World Bank

Potsdam Institute for Climate Impact Research (PIK), Germany

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Last edited: 18 March 2015


Stefan Hochrainer-Stigler

Senior Research Scholar Systemic Risk and Resilience Research Group - Advancing Systems Analysis Program

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