How much funding is the Nutrition Sector forecast to receive in 2022?
Funding to the Nutrition sector is forecast to be between $996m and $1422m in 2022. Our central estimate is $1266m. For reference, the Nutrition sector received $1392m last year.
This forecast is based on our 95% probability range. In other words, we are 95% sure that funding will be between $996m and $1422m. Below are the other forecast ranges for the Nutrition sector. As we become less sure about our forecast, the range narrows. So for example, we think there’s a 50% probability that funding will be between $1175m and $1347m.
But we need to put this into context. What does the forecast mean in terms of reaching the funding that is required for the sector (also known as the funding requirement)? The total funding requirement globally is determined by how much is needed in each context. Given that we don’t have the information yet we have projected the funding required for 2022 and compared that to the funding forecast. If you hover over the donut below you’ll be able to see the chances of reaching 25%, 50%, 75%, and 100% of the funding that is required.
As our donut shows, the Nutrition sector is almost certain to reach 25% of the funding required, but we think there’s only a remote chance that funding will reach anywhere above 50% of what is required.
How does the 2022 forecast compare to previous years?
The funding requirement increased again in 2021, to $2.6bn. This follows the past five years of the funding requirement increasing. In 2016, the funding requirement was $624m. That’s a quadrupling of the funding required in five years. By 2021, the Nutrition sector had the 5th largest funding requirement of all sectors. Yet, in 2016, the Nutrition sector had only the 8th largest funding requirement of all sectors. This reflects the relatively fast growth in Nutrition needs in the past five years.
We anticipate the funding required for Nutrition to climb yet further to around $2.8bn. Sector funding requirements are still being worked out, so this figure is preliminary and based on an extrapolation of the ‘envelope’ of Nutrition funding last year applied to the overall humanitarian funding ask in 2022.
Like the funding requirement, funding received by the sector has also increased significantly over the same time period. This increase was particularly significant between 2016 and 2017, just like the funding requirement albeit at a slightly lower rate – with funding received doubling from $365m to $762m. From 2017 to 2019, funding grew year-on-year to reach a peak of $1.3bn in 2019.
Over the 2016 to 2019 period, funding received into the sector increased at a higher rate than the funding requirement. This meant that the funding gap decreased across the time period, from 42% in 2016, to a relatively low 32% in 2019. However, due to the growth of the sector in terms of dollar value, this actually meant an increase in the funding gap in real terms from $260m to $603m. This is important to point out as ‘People In Need’ don’t live in a world of financial percentages, but in terms of actual money spent on services. Thus, in reality, there were $603m of services that could have been operating in 2019 but weren’t. Yet, relatively the sector was still doing well: it received $1.3bn in 2019, 68% of the funding requirement was full, and this had strengthened over the preceding years.
The sector slid back slightly in 2020, and readers will notice that this period coincides with the COVID-19 pandemic. Funding required and funding received leapt up in 2021 to record levels.
We don’t know yet know if funding will increase in 2022, with a central estimate of $1266m (slightly below 2021 levels). In percentage terms, we think that the sector will receive between 36% and 51% of the projected funding requirement.
We’ve come up with a way of conceptualising a growing funding gap. In this story, we’ve defined a “real humanitarian recession” as two consecutive years of a growing funding gap. Given that the funding gap in 2021 actually closed to only 45% in 2021, there isn’t any danger of the sector going into humanitarian recession this year.
That being said, we’re not so optimistic about Nutrition’s chances of closing the funding gap in 2022. In fact we think it’s almost certain that Nutrition will experience a year of real negative growth, in other words, a growing funding gap. Another year of this in 2023 could lead to a humanitarian recession for Nutrition.
How does the 2022 forecast compare to other sectors?
The Nutrition sector is forecast to be the 4th biggest sector in 2021, behind the only other sectors that are valued at $1bn+. Nutrition is ranked just below Health and ‘Multi-Sector’ – but not by much. But the sector quite will quite easily surpass the funding for Education and WASH, which are estimated to receive significantly lower, thus placing Nutrition in the ‘top tier’ of humanitarian sectors.
The sector is adjacent to both Health and Food Security in the work they do. So it shouldn’t be too much of surprise to see how well the sector ranks, as both Food Security and Health are also well funded sectors (compared to others).
The current state of things
Funding increased from 2018 to 2019. But then funding levels in the year of Coronavirus (2020) dropped back down to 2018 levels again. Could it be that donors withheld funding, diverted it to other humanitarian sectors, or to domestic funding at this stage?
However, funding to Nutrition appears to have recovered from the pandemic and looks to be back at, and above, 2019 levels. Funding to the Nutrition sector by the end of 2021 was $1406m (over $500m more than 2020 levels).
The question is, will funding to Nutrition continue to grow, or is the 2019 level a new equilibrium? So far in 2022, funding appears to be tracking 2019 and 2021 quite closely, hinting towards the possibility that the sector has a new $1bn+ equilibrium.
Features of the Nutrition sector in 2021
The average Nutrition response was only 35% funded in 2021. There are multiple ways to interpret this. On the one hand, the average response wouldn’t receive nearly 2 in every 3 dollars that they asked for, meaning that Nutrition responses are severely impacted. On the other hand, this actually benchmarks above average when looking at other sectors. In fact, the average sector had an equivalent percentage of 24%.
The good news is that over half of the contexts received over 25% of their funding requirement – these being mainly HRP contexts. Pakistan led the way, receiving 690% of the funding requirement for the HRP, whilst Afghanistan received 197% for the Flash Appeal and 173% for the HRP. The Madagascar Flash Appeal also received over 100% of the funding requirement.
Another observation is that all four of the bottom contexts (all receiving less than 1% of the funding ask), are in Central America. Could it be that these countries fare less well here because of their geography? It’s difficult to say based on just one sector, and we’ll investigate this further in the Stories section. We’ll also come up with an ‘Inequity Index’ to measure how unequal a sector is, and try to explain the causes around it. Could it be the status of the plan as we suggested here, or could it be the size of the funding requirement, donor preferences, under reporting, or other causes?
The US Government is the most dominant source of funding in the Nutrition sector, contributing 30% of all funding in 2021, equivalent to $423m. This is followed by the Government of Pakistan (15%), ECHO (12%), the Government of Germany (6%), the UK Government (6%), the Famine Relief Fund (5%), and the French Government (4%). Together these seven funders contribute 79% of all funding. Another 51donors contribute the other 21%.
The Nutrition sector isn’t a particularly diverse sector in terms of funding. We can measure the diversity of a sector’s funding by using a metric called the Herfindahl Hirschman Index. On a scale of 0 to 10,000, a sector is considered competitive if less than 1,500. The Nutrition sector has a score of 1,450 indicating a moderately concentrated sector. This means the sector really isn’t that diverse in terms of funding sources.
One potential implication to this is that the sector may not be that resilient to shocks. The most obvious example of an external shock to the humanitarian funding system was the coronavirus pandemic in 2020. In 2020, funding to the Nutrition sector dropped by over $400m. If your funding isn’t coming from a diverse range of actors in the system, it means that fewer donors are able to absorb the shock. One analogy that may be familiar is that of an organisation’s funding streams. You don’t want to get all your funding from one donor – you want to get funding from multiple donors in order to spread your risk. This is the ‘don’t put all your eggs in one basket’ approach. We’ve published a story about this here.
In terms of recipients of Nutrition funding, WFP and UNICEF unsurprisingly dominate the picture. $4 out of every $5 to Nutrition goes to these two UN agencies (though there will undoubtedly be ‘second-tier’ recipients of this funding). This is then followed by ‘Other’ where we are unable to say where the funding is going, and then a range of INGOs such as ACF and Save the Children.
Last year’s forecast can’t yet be judged against what the reality was as the 2021 numbers aren’t ‘final’ yet, despite it being 2022 already. It varies year-to-year, but there is still a non-trivial amount of funding that is logged after the end of the year. Therefore, we can’t really judge last year’s forecast until some point later in 2022. It’s at this point that we’ll do a post-mortem on our 2021 forecasts and see how well we did.
The usual health warning: FTS doesn’t capture everything. It is a platform that relies on voluntary reporting by organisations. But it is the most comprehensive source of data for humanitarian funding.
To find out methodology and sources for other things on this page which aren’t the forecast, click here.