38 trillion dollars in damages each year
Potsdam Institute for Climate Impact Research (PIK)
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Based
on empirical data from more than 1,600 regions worldwide over the past 40
years, scientists at the Potsdam Institute for Climate Impact Research (PIK)
assessed future impacts of changing climatic conditions on economic growth and
their persistence.
"Strong income reductions are projected for the
majority of regions, including North America and Europe, with South Asia and
Africa being most strongly affected. These are caused by the impact of climate
change on various aspects that are relevant for economic growth such as
agricultural yields, labour productivity or infrastructure," says PIK
scientist and first author of the study Maximilian Kotz.
Overall, global annual damages are estimated to be at 38
trillion dollars, with a likely range of 19-59 trillion dollars in 2050.
These damages mainly result from rising temperatures but
also from changes in rainfall and temperature variability.
Accounting for other weather extremes such as storms or
wildfires could further raise them.
Huge economic costs also for the United States and European Union
"Our analysis shows that climate change will cause
massive economic damages within the next 25 years in almost all countries
around the world, also in highly-developed ones such as Germany, France and the
United States," says PIK scientist Leonie Wenz who led the study.
"These near-term damages are a result of our past
emissions. We will need more adaptation efforts if we want to avoid at least
some of them. And we have to cut down our emissions drastically and immediately
-- if not, economic losses will become even bigger in the second half of the
century, amounting to up to 60% on global average by 2100. This clearly shows
that protecting our climate is much cheaper than not doing so, and that is
without even considering non-economic impacts such as loss of life or biodiversity."
To date, global projections of economic damages caused by
climate change typically focus on national impacts from average annual
temperatures over long-time horizons.
By including the latest empirical findings from climate
impacts on economic growth in more than 1,600 subnational regions worldwide
over the past 40 years and by focusing on the next 26 years, the researchers
were able to project sub-national damages from temperature and rainfall changes
in great detail across time and space all the while reducing the large
uncertainties associated with long-term projections.
The scientists combined empirical models with
state-of-the-art climate simulations (CMIP-6). Importantly, they also assessed
how persistently climate impacts have affected the economy in the past and took
this into account as well.
Countries least responsible will suffer most
"Our study highlights the considerable inequity of climate impacts: We find damages almost everywhere, but countries in the tropics will suffer the most because they are already warmer. Further temperature increases will therefore be most harmful there. The countries least responsible for climate change, are predicted to suffer income loss that is 60% greater than the higher-income countries and 40% greater than higher-emission countries.
"They are also the ones with the least resources to adapt to its impacts. It is on us to decide: structural change towards a renewable energy system is needed for our security and will save us money. Staying on the path we are currently on, will lead to catastrophic consequences. The temperature of the planet can only be stabilized if we stop burning oil, gas and coal," says Anders Levermann, Head of Research Department Complexity Science at the Potsdam Institute and co-author of the study.
