Guest essay by Eric Worrall
According to the EIU, climate change will cause tremendous economic harm, but the USA and Europe will be least affected.
The Asian economy will be 2.6% smaller by 2050 due to lack of climate resilience
Wednesday 20 November 2019
- The Asia-Pacific economy will be 2.6 per cent smaller in 2050 according a new framework developed by The Economist Intelligence Unit (The EIU), with developing countries in the region set to be the most affected.
- The EIU expects economic losses in every year leading up to 2050, with the risk that further losses could be seen if policy effectiveness is not improved.
- According to The EIU’s framework, Africa is the least resilient region to the impact of climate change (4.7 per cent smaller), followed by Latin America (3.8 per cent), the Middle East (3.7 per cent), Eastern Europe (3 per cent) and the Asia-Pacific.
- North America (1.1 per cent smaller) and Western Europe (1.7 per cent) display the most resilience and are likely to see the least impact economically because both regions are richer and more prepared to tackle climate change from an institutional standpoint.
- The EIU’s research shows that being rich is an advantage to tackle climate change, but institutional quality matters, too.
The EIU’s research shows that being rich is an advantage, but institutional quality matters, too. Institutional quality is a major determinant of long-run economic growth, but The EIU’s results also point to the importance of institutional quality for minimising the impact of climate change. Poor institutions, therefore, can simultaneously harm economic growth and exacerbate the negative impacts of climate change.
The report is available here, if you are prepared to provide some intrusive personal information.
I haven’t read the report (I didn’t want to provide that intrusive personal information), but I guess we now understand why “climate losses” are projected to be so severe in Africa, compared to the USA and Europe; most Africans don’t enjoy the benefits of a wealthy fossil fuel powered economy.