OECD Predicts Global Drought Losses to Surge Over 35% by 2035, Warns of USD 307 Billion Annual Impact Without Urgent Adaptation.
International
The Organisation for Economic Cooperation and Development (OECD), headquartered in Paris and led by Secretary-General Mathias Cormann, released its report titled “Global Drought Outlook: Trends, Impacts and Policies to Adapt to a Drier World” on June 15, 2025. The study presents a comprehensive risk analysis of global drought events through the lens of policy, economy, and climate science.
- According to OECD’s analysis, the economic cost of droughts is expected to rise by over 35% globally by 2035, unless urgent adaptation measures are implemented. Droughts already cost the world an estimated USD 307 billion per year, and this figure is projected to increase substantially in the coming decade.
- The report revealed that 40% of global land has faced heightened drought intensity and frequency in the last two decades, largely due to shifting rainfall patterns, rising heatwaves, and reduced soil moisture caused by global warming trends.
Main Point :- (i) Between 1900 and 2020, the total land area affected by drought has doubled, while since 1980, 37% of the Earth’s soil has lost significant moisture content, creating long-term degradation in agricultural and ecological productivity.
(ii) Droughts are now directly impacting infrastructure and economies. The report warns that fluvial water volumes may drop by up to 40%, and hydropower output may decline by over 25%, thereby disrupting energy grids, industrial operations, and supply chain resilience.
(iii) The OECD emphasized that effective drought adaptation policies—such as nature-based solutions (NbS), ecosystem restoration, sustainable water use, and improved land governance—can generate $10.1 trillion in annual global benefits by 2030 and return $27 for every $1 invested.
About the Organisation for Economic Cooperation and Development (OECD)
Secretary General : Mathias Hubert Paul Cormann
Headquarters : Paris, France
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