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Conflict and violence are on the rise

Conflict is rising

2019/20 saw 54 active conflicts – which is on par with the record set in 2016 – and a record high of 47 minor armed conflicts. Internal conflicts are dominant.

Source: Aas Rustad (2021)

Around 555 million people lived within 50 kilometres of a conflict event in 1990, compared with almost 1.2 billion –15 percent of the world’s population –in 2020.

Source: Uppsala Conflict Data Program Georeferenced Event Dataset, Ostby, Aas Rustad and Tollefsen (2020)

Conflict increases hunger and poverty

Conflict is a major cause of poverty and hunger

In 2020, 2.4 billion people were moderately or severely food insecure, up 44 percent (or 723 million people) from 2014.

Source: : FAO (2021), UNDESA (2015), UNDP HDRO (2022)

The SDGs are not being achieved

Conflict hinders development

75% of world’s extreme poor – 1.8 billion people - live in 57 conflict affected countries that are not meeting any SDG's.

Private financial flows are in decline in conflict-affected settings

Private financial flows are lowest in fragile and conflict-affected settings

Between 2012 and 2018, foreign direct investment (FDI) declined by 53 percent, leaving a massive gap in investment.

Source: PBSO, DPPA, PBSB, Background note on Financial Flows for Peacebuilding, (2021)

Current blended finance approaches are not enough

Existing blended finance approaches are not filling the gap

The least-developed countries have attracted only 6% of all the private finance that official development assistance (ODA) has mobilised. This is due to a variety of factors, but the principal cause is a failure to link development and peace strategies to private sector activity.

Source: OECD and UNCDF (2020), ‘Blended Finance in the Least Developed Countries 2020: Supporting a Resilient COVID-19 Recovery’, OECD Publishing.

There are bankable opportunities in Peace Finance

There is significant bankable opportunity in growing new categories of sustainable finance.

Global sustainable issuance more than doubled to USD 1.64 trillion in 2021, from USD 761 billion issued in 2020. If only 1 percent of this issuance was aligned with Peace Finance standards and impact frameworks, more than USD 16 billion of peace-enhancing finance could be raised.

Source: Bloomberg New Energy Finance

© Finance for Peace 2023