In its annual Global Trends report, the United Nations refugee agency (UNHCR) revealed that in 2025, 14.4 million displaced people returned to their home countries – the second-highest number since records began.
This statistic looks like progress, but it tells only part of the story. A historic contraction in humanitarian aid is making conditions in refugee settlements increasingly untenable. Many have returned not because it is safe, but because they can no longer see a viable future in the settlements that have become their homes.
At the same time, conflict continues to escalate globally, threatening to increase displacement. The 14 million people who the UNHCR report have returned home were matched by nearly 14 million newly displaced. Meanwhile, economic shocks are increasing food insecurity and placing even greater strain on humanitarian systems already struggling to meet growing needs.
Against this backdrop of growing emergencies and shrinking budgets, we need to offer displaced people more than just short-term relief.
Refugees left defenceless
Displacement is rarely temporary. Refugees often spend years – sometimes decades – in settlements that were designed as a short-term solution but have become their long-term homes.
In many host countries, restrictive labour rules mean refugees are not legally allowed to work and – denied the right to earn a living and provide for themselves – become dependent on humanitarian support. Without the tools or resources to become economically self-reliant, refugees are left defenceless against external shocks and aid cuts.
The recent aid crisis has highlighted this fragility. In the last 18 months, cuts to spending have had a direct impact on the food rations and basic provisions that many refugees rely on.
The UN World Food Programme reports that due to cuts, aid that helped to feed around 1.6m refugees in Uganda in early 2025 now reaches only 660,000. As a result, one million people have now been cut off from the support they relied upon to meet their basic needs.
Cuts in aid have not just led to a reduction in food provisions, they have meant reduced settlement support and funding for other basic needs, such as healthcare.
The availability of aid is just one of a number of shocks that can impact the lives of refugees, however. Climate change is another growing challenge.
Data shows that three in four displaced people live in highly climate-vulnerable nations, where extreme weather events are actively straining basic water and survival systems. By 2050, the hottest 15 refugee camps in the world – all in Africa – are projected to face nearly 200 days of hazardous heat stress per year.
In tandem with dwindling aid and escalating climate pressures, macroeconomic factors like rising inflation, and health crises, introduce further layers of vulnerability to these settlements.
Without the ability to build livelihoods that generate income and grow their assets and savings, refugees living in camps are unable to build up resilience to these economic shocks.
As a result, many refugees who have already been forced to flee their homes are now being forced to leave the settlements where they rebuilt their lives.
From handouts to livelihoods
To truly support refugees, interventions must shift the focus from simple survival to sustainable livelihoods – enabling refugees to live to their full potential and with dignity.
This means having the ability to remain in education, build professional skills, and secure meaningful jobs. When refugees are given the space to build their lives, they are able to contribute to their local economies and build resilience for long-term economic empowerment.
In Uganda and Ethiopia, Village Enterprise and Mercy Corps have partnered on the DREAMS programme, an approach that supports livelihoods through entrepreneurship. The programme helps refugees start small businesses, operating within refugee settlements and the communities that host them by providing business training, seed funding, and business mentorship while strengthening local markets and private sector connections.
Through DREAMS, refugees in Uganda and Ethiopia have created thriving livestock and agriculture enterprises, as well as hair salons, tailoring, and retail businesses.
Two randomised controlled trials (RCTs) of the DREAMS programme showed household consumption increased by 17% in Uganda and 9% in Ethiopia when compared with a control group. Their assets also increased by 20% and savings by over 90%. In practice this meant that participants were able to buy more nutrient-rich foods, fund their children’s education, and pay for basic healthcare for their families. They were able to put money aside to protect themselves from future shocks. And invest in valuable assets – livestock, agricultural tools, housing, solar panels, and furniture for their homes.
On top of DREAMS, there are other programmes providing much needed support for refugees and working to make life in refugee settlements more sustainable. Another initiative tackling this is Okapi Green Energy in Kenya, which operates a solar minigrid that serves affordable, renewable energy to refugee-led computer cafes, maize mills, and grocery shops.
Meanwhile, Live in Green, a refugee-founded organisation in Uganda, transforms agricultural waste into clean-energy briquettes and provides eco-stoves while training farmers in climate-resilient agriculture to protect the local environment.
Looking beyond sub-Saharan Africa, Talent Beyond Boundaries connects skilled refugees with global job placements in the US, Australia, and Europe, advocating for displaced people to be included in labour migration pathways.
Whether through green infrastructure, education, or employment, these approaches address the root causes of poverty, helping to break the dependency cycle and provide long-term sustainable futures to refugees.
Beyond short-term relief
The traditional humanitarian model is overstretched and underfunded, and we urgently need new solutions for supporting refugees that are cost-effective. We must recognise that refugees must be able to thrive, and not simply survive, in refugee camps.
Emergency relief will always be essential in the immediate aftermath of a crisis. But when displacement lasts for years, humanitarian assistance alone is not enough. We must also invest in approaches that help refugees earn incomes, build assets, and strengthen their resilience to future shocks.
The right interventions can enable refugees to become financially self-reliant, while allowing scarce humanitarian resources to be directed towards those with the greatest immediate needs.
If we don’t invest in these solutions, we leave refugees vulnerable to changing circumstances and facing a situation where returning to the crisis they escaped becomes their only option.
Sazini Mojapelo is CEO of Village Enterprise.