Climate change could directly cost the world economy $7.9 trillion by mid-century as increased drought, flooding and crop failures hamper growth and threaten infrastructure, new analysis showed Wednesday.
The Economist Intelligence Unit’s (EIU) Climate Change Resilience Index measured the preparedness of the world’s 82 largest economies and found that based on current trends the fallout of warming temperatures would shave off three percent of global GDP by 2050.
Its analysis, which assesses each country’s direct exposure to loss as climate change brings more frequent extreme weather events, found Africa was most at-risk, with 4.7 percent of its GDP in the balance.
In general, developing nations faired poorer in terms of resiliency than richer ones. “Being rich matters,” John Ferguson, EIU country analysis director, told AFP.
“Richer nations are really able to be more resilient towards the impacts of climate change, so this really threatens growth trajectories of the developing world as they try to catch up with the developed world.”
“When we are already dealing with global inequality, for the impacts of climate change the developing world’s challenges are much greater,” he added. Of the countries evaluated, Angola stood to lose the most — as much as 6.1 percent of gross domestic product.
Climate change and development are closely intertwined. Poor people in developing countries feel the impacts first and worst because of vulnerable geography and lesser ability to cope with damage from severe weather and rising sea levels. In short, climate change will be awful for everyone but catastrophic for the poor.
Poorer countries – those that have contributed far less to climate change – tend to be situated in warmer regions, where additional warming causes the most devastation. Extreme weather events in these countries are becoming more likely and severe.
These events are disproportionately bringing death, displacement, and crop failure. Furthermore, poorer countries don’t have the means to mitigate climate change risks or adapt to circumstances, as developed nations do. As a result of this, projections estimate that the economies of poorer, warmer countries will be gravely harmed by climate change over coming decades, while the cooler, richer countries responsible for the vast majority of the extra CO2 in the air may even benefit in the short term. But as new research reveals, this is not just a future concern – the economic injustice of climate change has already been operating for 60 years.
The study put this down to a mixture of a lack of quality infrastructure, as well as its geographical exposure to severe drought, soil erosion and rising sea levels. Land degradation in Angola would prove a “significant” economic hindrance, the report said, given that agriculture is its largest employer.
Nigeria (5.9 percent negative GDP), Egypt (5.5 percent), Bangladesh (5.4 percent) and Venezuela (5.1 percent) were the next most climate-vulnerable nations identified in the analysis.
The analysis said rising temperatures meant the global economy was projected to hit $250 trillion by 2050, as opposed to $258 trillion with no climate impact.
While the United States — still the world’s largest economy at market rates — is forecast to be one of the least impacted, the EIU noted that President Donald Trump’s policies represented a “temporary setback” in the climate fight.
Russia was predicted to lose five percent of GDP by 2050 and will “suffer more than most other countries in the world from the negative effects of climate change”, it said. This held true even when potential benefits in increased agriculture were taken into account.
Melting permafrost — threatening infrastructure such as hydrocarbon pipelines — was forecast to be among the biggest drags on Russia’s economy in the coming decades. Nations agreed in Paris in 2015 to work to limit temperature rises to “well below” two degrees Celsius, and 1.5-C if possible.