Building a comprehensive disaster risk reduction financing strategy in the Republic of Armenia

This report assesses Armenia’s existing DRR financing mechanisms and challenges, recommends structural reforms, and applies a structured methodology to identify and prioritize DRR investment needs. Armenia faces increasing disaster risks that pose serious threats to economic stability, public safety, and sustainable development. To address these challenges, the United Nations Office for Disaster Risk Reduction (UNDRR), supported by the United Nations Development Programme (UNDP), in close collaboration with national government, financial institutions, the private sector and development partners, collaborated on an initiative to strengthen the country’s financial resilience to natural hazards. This initiative applies UNDRR’s methodology on developing national frameworks for DRR financing to Armenia’s national context, with a focus on integrating risk considerations into investment planning and enhancing long-term resilience.

Part 1 identifies current financing mechanisms, gaps, and challenges, providing a foundation for understanding Armenia’s financial preparedness for disaster resilience. It highlights the economic impact of disasters, the role of public and private investments, and the importance of securing sustainable funding sources. It leads to structural reform recommendations to enhance DRR within the national financial framework. Part 2 presents a structured approach to identifying, prioritizing, and financing DRR investment needs. It introduces practical tools such as multi-criteria analysis (MCA) for investment prioritization, feasibility assessments, and financing mechanisms to improve DRR funding. The methodology’s application is illustrated on the financial sector DRR investment needs, based on consultations with the Central Bank of Armenia and other relevant institutions. Together, these parts create a comprehensive framework enabling policymakers and financial institutions to increase resources for DRR and to risk-inform public and private investments