Climate Change can reduce GDP by 17% by 2070: ADB
New Asian Development Bank (ADB) research finds that the impacts of climate change could reduce gross domestic product (GDP) in developing Asia and the Pacific by 17% by 2070 under a high-end greenhouse gas emissions scenario, rising to 41% by 2100.
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The greatest losses would be from rising sea levels and falling labor productivity. Lower income and fragile economies would be hit the hardest.
ADB’s Asia-Pacific Climate Report
The new research is presented in the inaugural issue of ADB’s Asia-Pacific Climate Report, detailing a series of damaging impacts threatening the region.
If the climate crisis continues to intensify, as many studies project, about 300 million people along the coasts will face the risk of coastal inundation; and trillions of dollars of coastal assets can suffer damage annually by 2070.
Climate change has supercharged the devastation from tropical storms, heat waves, and floods in the region, contributing to unprecedented economic challenges and human suffering, said ADB President Masatsugu Asakawa.
“Urgent, well-coordinated climate action that addresses these impacts is needed before it is too late. This climate report provides insight into how to finance urgent adaptation needs and offers promising policy recommendations to governments in our developing member countries on how to reduce greenhouse gas emissions at lowest cost,” he said.
Regional Support: Climate Change can reduce GDP by 17% by 2070: ADB
Regional public opinion is supportive of climate action. In an ADB climate change perception study this year, 91% of respondents across 14 regional economies said they view global warming as a serious problem, with many seeking more ambitious government action.
Adaptation responses need to be accelerated to address growing climate risks, along with an imperative to greatly upscale adaptation-focused climate finance.
According to the report, the adaptation needs of regional countries require an estimated annual investment amount between $102 billion and $431 billion—compared to the $34 billion in tracked adaptation finance in the region for 2021–2022.
Government Regulations: Climate Change can reduce GDP by 17% by 2070: ADB
Government regulation reforms and increased recognition of climate risks are attracting new sources of private climate capital, but much greater private investment flows will be needed.
Of course, on the mitigation front, the report shows that this region is well placed to embrace renewable energy in driving a transition to net zero, and forging ahead with domestic and international carbon markets can help achieve climate action goals cost-effectively.
Climate Change can reduce GDP by 17% by 2070: ADB
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