Financing Forced Displacement

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Forced displacement, including refugees fleeing across borders, is a global phenomenon. As of end 2020, 82.4 million people had been forced to flee their homes world-wide, according to UNHCR. Despite COVID-related movement restrictions and pleas from the international community for a ceasefire that would facilitate the COVID-19 response, displacement continued to occur - and to grow. 1 in every 95 people in the world is forcibly displaced. In 2018, the international community adopted the Global Compact on Refugees. It outlines arrangements for more predictable and equitable sharing of burdens and responsibilities when it comes to the word’s refugees.

How can we adapt development strategy and financing to the reality of forced displacement?

OECD work focuses on assessing current development practices in forced displacement contexts, and on defining how development finance can best be used to support forcibly displaced people around the world. This includes the application of the Humanitarian-Development-Peace (HDP) Nexus in refugee situations and providing related policy guidance.

INCAF Common Position on supporting comprehensive responses in refugee situations

The International Network on Conflict and Fragility (INCAF) has developed a common position on supporting comprehensive response in refugee situations.

Read the Common Position

Financing for refugee situations constituted 12.3% of all global Official Development Assistance (ODA) in 2018-19

This included financing for ODA recipient countries and in-donor costs, benefiting refugees and host communities. While this is significant, more remains to be done to ensure an even distribution of financing, and in terms of development and peace support for comprehensive refugee responses across the HDP Nexus spectrum. Financing refugee situations also means reducing fragility, preserving, and/or achieving development gains.

In-donor refugee costs

The Development Assistance Committee (DAC) has clarified the reporting directives for assessing what may be included or not in ODA – and provide its members with a blueprint to use when accounting for the costs of assisting refugees in donor countries.

Read the details and related donor profiles

Seven good practice principles for financing for refugee situations

Refugee situations are complex, context-specific and bring together large movements of people as well as significant vulnerabilities and fragilities. Financing plays an important role in refugee responses, but is not yet fit-for-purpose to respond to the challenges and opportunities that patterns of displacement present. The OECD paper on Financing for Refugee Situations proposes seven good practice principles for adapting financing to the reality of refugee situations, based on global trends and case studies in Central African Republic, Colombia, Lebanon and Uganda:

Promote an enabling refugee policy environment, including access to social services and documentation.
Adapt financing systems and tools to fit the reality of mobile populations.
Support for local as well as national systems, including through financing and capacity building.
Bring development and peace interventions by default, in addition to humanitarian responses.
Promoting refugee self-reliance through education, entrepreneurship, and work
Loans can be a useful part of the financing mix as long as they are as concessional as possible.
Link up with Southern and traditional providers, and strategically coordinate across key actors.

Read the paper

Financing refugee-hosting contexts

Official Development Assistance (ODA) plays a key role in ensuring that no one is left behind on the path toward sustainable development – and refugees are no exception. According to UNHCR, 85% of refugees are hosted in developing countries. The Global Compact on Refugees (GCR) outlines arrangements for a more predictable and equitable sharing of burdens and responsibilities when it comes to protecting and supporting the world’s refugees. In order to inform how the international community can utilize funding more effectively to meet these responsibilities, it is essential to consider how ODA is spent in these settings – and to outline priorities to guide donor support and engagement going forward.

Working paper Financing Refugee-Hosting Contexts: an analysis of the DAC’s contribution to burden- and responsiblity-sharing in supporting refugees and their host communities.

ODA 2018-19 to programmes & projects supporting refugees & their host communities

Click the visualisation for more information
by Regions & Countries/Territories	by Top Recipients	by Types & Years

Ongoing projects on forced displacement in partnership with UNHCR and others UNHCR

The OECD undertakes a set of policy guidance and research initiatives on forced displacement, in partnership with UNHCR and others. Current ongoing projects include the regularisation of data collection on financing for refugee situations, “enhancing self-reliance through social protection in situations of forced displacement”, and the application of the Humanitarian-Development-Peace Nexus principles in situations of forced displacement.

Conflict, fragility and resilience