GLOBAL ECONOMIC IMPACTS OF CLIMATE CHANGE
Climate Change has been an age-old issue for inhabitants of the planet. Be it the melting glaciers in the Arctic, the air pollution in major cities of the world such as Delhi and Beijing, or the wildfires in Australia and the United States, the impacts of climate change extend well on the far side — an increase in temperature, disrupting ecosystems and communities across the world. Things that we depend upon for survival — water, energy, transportation, wildlife, agriculture, ecosystems, and human health — have all been victims and are experiencing the results of a dynamical climate.
With the huge downswing within the world economy thanks to the new pandemic, temperature change still continues to be a serious contributor. Last year, climate change contributed to severe weather events, causing a minimum of $100 billion in damages. By 2050, cumulative damages from climate change are likely to reach $8 trillion, impoverishing by 3% of gross world product and the poorest regions by more of their gross domestic product (GDP). The frequency and intensity of extreme weather, in several countries, will mutilate factories, supply chain operations, and over 22 sectors of the economy. Drought can exert a costlier effect on the price of raw materials and production. Agricultural yields are highly sensitive to climatic conditions and as the climate will continue to become more and more extreme, additional frequent droughts could scale back crop yields in areas where food production is important. Higher world food costs can possibly squeeze consumers’ financial gain within the method. Rising inflation can also pass off through reduced land accessibility. The surge in world temperatures could eventually cause some areas of the globe to become unlivable and with this may come mass migration. Similarly, the insurance companies will likely bear a major chunk of risk pertinent to climate change if things continue to remain the same. These firms have already felt the force of extreme weather-related injury caused to properties, and have been covering the costs. It’s believed that 2011 was the costliest year on record for natural disasters, with insured losses accounting the trade over $126 billion.
As of the current time, KPMG advised that there are growing signs of firms setting out to recognize the economic impact of climate change and 76% of business leaders surveyed viewing the measures as a ‘strategic risk issue’, while less than one-fourth (24%) regarded climate-related financial disclosure as merely a helpful compliance tool.
It’s the need of the hour to take the necessary steps to drive the development of sustainable economic growth, else as per warnings by The World Bank, climate change could push over a 100 million more people into poverty by the year 2030.
Contributed By- Shravya Srinivas, Content Writer@ Mitti Ke Rang
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