THE FAILURE to act on climate change and limit emissions is already costing the world economy 1.6% of global GDP.
This equates to some $1.2 trillion, but by 2030 it could be double that due to escalating temperatures and carbon-related pollution.
The figures come from a new study by DARA and the Climate Vulnerable Forum. Twenty governments commissioned the independent report, the first of its kind to show that tackling the global climate crisis would already reap significant economic benefits for world, major economies and poor nations alike.
Described as the most comprehensive ever assessment of the current global impact of climate change, the report also found that the economic losses will dwarf the modest costs in tackling climate change. China, India and the US are the countries that will be hardest hit in terms of financial losses, with the latter losing 2% of GDP.
However, its in the least developed countries that the losses will be most extreme, with an average of 11% of GDP lost to climate change.
One degree Celsius rise in temperature is associated with 10% productivity loss in farming. For us, it means losing about four million metric tonnes of food grain, amounting to about US$ 2.5 billion. That is about 2% of our GDP, said Bangladesh Prime Minister and the Forums chair Sheikh Hasina. Adding up the damages to property and other losses, we are faced with a total loss of about 3-4% of GDP. Without these losses, we could have easily secured much higher growth.
Hasina highlighted the 17 years of international negotiations [ ] without any meaningful agreement or action to reduce global warming, adding that the report is a milestone for the climate negotiations.
Recent weather events across the world, from the droughts in the US to the floods in the UK, have brought changing weather patterns under the spotlight.
Connie Hedegaard, the European Union's climate chief, warned in the Guardian recently that extreme weather was becoming more common, as the effects of climate change take hold. "Climate change and weather extremes are not about a distant future. Formerly one-off extreme weather episodes seem to be becoming the new normal, she wrote in a comment for the newspaper.
Businesses don't need to be told about the financial losses caused by weather extremes. This summer's drought in the US devastated the multibillion-dollar corn and soybean crops. Insurers in the US may face as much as $20 billion losses this year, their biggest ever loss in agriculture. This is not exactly helping fight the economic crisis.