Emerging evidence shows a persistent financing gap for recovery and resilience initiatives that support the transition from humanitarian response to long-term development, sometimes referred to as the ‘missing middle.’ These initiatives often aim to restore essential services, rebuild critical infrastructure, support governance systems, and ensure access to jobs and livelihoods. Despite a critical need, these initiatives are often underfunded, as financing flows are concentrated at two poles: immediate life-saving humanitarian relief and long-term sustainable development programming. As a result, early recovery initiatives lack adequate and timely financial support.

One of the key factors in perpetuating the ‘missing middle’ financing gap is the perception that in countries that are experiencing or emerging from conflict, the risk of investment is too high. Public and private investors determine the time is not right to engage in these complex settings. However, this is counter-intuitive to our efforts to support sustainable development. As countries look to rebuild post-crisis, it is vital to invest in their future.

While many investors—both public and private—may not be able to invest on their own in high-risk settings, together UNCDF and UNDP are working to change this reality, enabling investment when it is needed most. In doing so, UNCDF and UNDP are addressing the ‘missing middle’ financing gap, which is vital to stabilize communities, build resilience, and support the transition from crisis to sustainable development.