Luxembourg sets up first global investment fund to combat drought

On 17 September 2025, Luxembourg officially signed an agreement to establish the Drought Resilience Investment Facility (DRIF), the world's first investment fund aimed entirely at countering droughts and strengthening the resilience of affected regions. The document was signed in Luxembourg by Deputy Prime Minister and Minister of Foreign Affairs Xavier Bettel, Minister of Finance Gilles Roth and Yasmine Fouad, Executive Secretary of the UN Convention to Combat Desertification.

The DRIF fund will be hosted in Luxembourg and aims to mobilise around $400 million of investment in sustainable agriculture, improving access to water and supporting natural solutions for land restoration. Luxembourg has already committed €2 million, demonstrating its commitment to sustainable development and financing with positive climate and social impact.

The UN estimates that 40% of the planet's landmass is already affected by drought, which is a "silent scourge" affecting one in four people on Earth. Unless action is taken, three out of four will face water shortages by 2050. Drought exacerbates social inequalities, migration, conflict and food crises, especially in regions already vulnerable to climate change.

DRIF was a continuation of Luxembourg's participation in the UN's work on sustainable development. The country has been a party to the Convention to Combat Desertification since 1996. The creation of the fund strengthens its image as a global player in climate and humanitarian initiatives.