1284. Global Drought Outlook

Droughts are becoming more frequent and severe around the world. According to a new analysis by the Organization for Economic Cooperation and Development (OECD), the amount of land area affected by drought doubled between 1900 and 2020, with droughts becoming more severe on 40% of land areas in recent decades.

The increased risk of drought is caused by a combination of factors, with climate change at its core. Rising temperatures cause increased evaporation, disrupted precipitation patterns, and reduced snow cover and glacier reserves. For example, climate change has increased the probability of a drought in Europe in 2022 by up to 20 times, and the probability of a drought currently occurring in North America by 42%. Projections suggest that if temperatures rise by 4°C, the frequency and intensity of droughts could increase by up to seven times compared to a scenario without climate change.

Human activities such as deforestation, urban expansion, and unsustainable agricultural practices further exacerbate drought risks by degrading ecosystems and water resources. Irrigation accounts for 70% of global water withdrawals and, if implemented unsustainably, can worsen drought conditions by up to 30 times in some regions. Urban development reduces water infiltration and aquifer recharge in all OECD countries. These challenges will further amplify existing climate change pressures, further threatening freshwater availability.

Droughts impede freshwater availability, with far-reaching consequences for ecosystems that depend on it. A new OECD analysis shows that 37% of the world's land area has seen a significant decrease in soil moisture since 1980. Changes in water availability accelerate soil degradation, negatively impacting ecosystems such as forests and wetlands, and affecting plant biomass and distribution. This threatens biodiversity, impedes important ecosystem services such as water purification and carbon sequestration, and exacerbates future drought risks through negative feedback loops.

New OECD analysis highlights the sharp increase in the economic costs of droughts, with losses and damages increasing at a rate of 3–7.5% per year globally. The OECD projects that the cost of drought events in 2025 will be more than double that of 2000 on average, and by 2035, costs will be more than 35% higher than today. The most affected sector is agriculture, where crop yields could be reduced by up to 22% in particularly dry years. The economic impacts of droughts are not limited to agriculture. Severe droughts can reduce riverine trade volumes by up to 40% and hydroelectric power generation by more than 25%, affecting supply chains and energy availability. However, current estimates remain context-sensitive and further analysis is needed to fully understand the impacts of droughts on different sectors.

The human costs of droughts are similarly devastating. Despite accounting for only 6% of all natural disasters, droughts cause 34% of all disaster-related deaths. Prolonged droughts can trap people in a vicious cycle of poverty and deepen social inequalities, especially in sub-Saharan Africa, and food security crises can trigger political instability, social unrest, and geopolitical tensions over scarce resources.

Increasing drought risk highlights the need for a proactive approach to building resilience and adapting to climate change. Investing in drought resilience can not only reduce the direct costs of drought but also deliver long-term economic, social, and environmental benefits. Evidence suggests that every dollar invested in drought preparedness can generate $2–3 in benefits and that returns on resilience investments can be up to 10 times their initial costs.

Adapting to drought risk requires effective integrated water resources management to ensure efficient water use, conservation, and equitable allocation of water resources, while improving supply resilience and restoring the balance between withdrawals and replenishment. It also requires cross-sectoral action. Sustainable land use, ecosystem restoration, and adaptive agriculture can help soils retain moisture, regulate the hydrological cycle, and improve resilience. Drought-tolerant crops have also shown the potential to reduce water use and improve yields, even in dry years. Moreover, adaptive agriculture in sectors such as energy, transport, and buildings can contribute to reducing the impacts of drought and strengthening resilience to broader climate change. Appropriate strategies across sectors and stakeholders can lay the foundations for sustainable development and ensure water and food security, climate resilience, and healthy ecosystems for future generations. 

(Reference)
OECD (2025), Global Drought Outlook: Trends, Impacts and Policies to Adapt to a Drier World, OECD Publishing, Paris, https://doi.org/10.1787/d492583a-en

Contributor: Miyuki IIYAMA, Information Program