Why does crisis finance stall, and where?
Governments can have financing in place and still fail to deploy it effectively when disaster strikes. Fiscal Hydraulics is a structured diagnostic designed to identify where crisis finance is most likely to stall in a sovereign system. It complements established tools by translating institutional readiness into operational responsiveness.
Readiness does not equal responsiveness
Countries may score well on assessments and still lack the mechanisms to move funds quickly when a shock hits. The gap between available financing and the ability to convert it into completed projects or delivered services is one of the defining challenges in disaster response.
———————>
Crisis liquidity from Trigger to Transit
Fiscal Hydraulics focuses on three factors:
Trigger — How fast financing is activated and released.
Track — The route it takes through the network.
Transit — How easily it moves on its route through the network.
The diagnostic system integrates three parts:
Fiscal Hydraulics Framework — A model of the fiscal plumbing governments can use to move money when a shock occurs and ensure system resilience.
Fiscal Hydraulics Diagnostic — A structured way of checking flow characteristics, surfacing potential binding constraints that indicate where governments may struggle to mobilise resources in a crisis.
Fiscal Hydraulics Intelligence — A multi-country database compiled from applying the diagnostic tool and recording outputs for comparative analysis.
———————>
Who is it for?
Finance ministries asking whether their crisis response will hold under the next shock.
IFIs and bilateral donors deciding where to target technical assistance.
Insurers and climate finance providers assessing whether systems can deploy funds effectively.
Development consultancies and research institutions working on PFM reform and fiscal resilience.
———————>
Concept note available upon request.