Climate Change May Cause Global GDP To Drop 4% By 2050
2 May 22
A recent study conducted by rating firm S&P Global is predicting that climate change could put 4% of the global Gross Domestic Product at risk, with poorer parts of the world potentially being hit the hardest.
The study analyzed 135 countries and assigned credit scores based on the health of their economies. By using data from the World Bank, they found that lower and lower-middle income countries could suffer drops in GDP that are 3.6 times larger than in higher income countries.
According to the Reuters, South Asia has 10%-18% of GDP at risk. This is mainly due to Bangladesh, India, Pakistan and Sri Lanka’s high risk for wildfires, floods, major storms, and water shortages. Central Asia, the Middle East and North Africa and Sub-Saharan Africa regions are also at high-risk of major losses. Meanwhile, Europe is likely to be the least affected region.
“To different degrees, this is an issue for the world,” said S&P’s top government credit analyst, Roberto Sifon-Arevalo. “One thing that really jumps out is the need for international support for many of these (poorer) parts of the world”.
Some countries have already economically suffered due to natural disasters. According to insurance provider Swiss Re, storms, wildfires, and floods have cost the world economy roughly 0.3 percent of GDP per year over the last ten years.