| 12 April 2024, Friday |

World could lose a fifth of GDP without climate action

The global economy could lose nearly a fifth of economic output by 2050 should the world fail to check climate change, with Asia particularly at risk, a study released by reinsurer Swiss Re  on Thursday found.

The report  from the Swiss Re Institute said output could be 18% lower than in a world without climate change if no mitigating actions are taken and temperatures rise by 3.2 degrees Centigrade.

Should targets under the Paris Agreement be met and temperatures rise less than 2C, the shrinkage can be limited to 4%, it found.

“Economies in Asia would be hardest hit, with China at risk of losing nearly 24% of its GDP in a severe scenario, while the world’s biggest economy, the US, stands to lose close to 10%, and Europe almost 11%,” the report found.

Its stress test examined how 48 economies would be impacted by the effects of climate change under four different temperature increase scenarios.

As global warming makes the impact of weather-related natural disasters more severe, it can lead to substantial income and productivity losses over time, it said.

For example, rising sea levels result in loss of land that could have otherwise been used productively and heat stress can lead to crop failures. Emerging economies in equatorial regions would be most affected by rising temperatures.

  • Reuters