Jakarta – The ongoing rise in global temperature is feared to be an ecological threat and a time bomb for the world economy. A recent study conducted by a team of scientists from the University of New South Wales (UNSW Sydney) revealed that if the Earth’s temperature increases by 3 degrees Celsius compared to pre-industrial times by the end of this century, the world’s Gross Domestic Product (GDP) could plummet by up to 40 per cent.
Timothy Neal, lead researcher of the study, as quoted from Energy Live News, Friday, 4 April, conveyed that climate change’s impact on the economy is much greater than previously thought. They said this is no longer just an environmental issue, but a real threat to global economic stability.
In contrast to the old approach, the study uses an economic model incorporating global interconnectedness in supply chains, trade and food production. Previous models tend to assume that extreme weather only affects countries in their own region. As a result, many older analyses underestimated the economic costs of the climate crisis.
For comparison, previous projections suggested that 3 degrees of global warming would only reduce the world economy by 11 per cent. But the new approach from Neal’s team shows that when global economic networks are disrupted simultaneously by climate disasters—such as floods, droughts, storms, and heatwaves—the scale of the devastation is much larger and occurs in almost all regions of the world.
The study found that no country can escape the economic effects of climate change, including cold-climate countries like Russia or northern Europe, which have been believed to benefit from global warming.
They said that global warming increases the likelihood of these disasters occurring simultaneously in different parts of the world, drastically reducing the capacity for economic recovery.
The findings also challenge the long-held view that aggressive efforts to reduce emissions harm economic growth. In many previous models, a target temperature rise of 2.7 degrees Celsius was considered economically acceptable. However, the study emphasises that the ideal scenario is to hold the temperature rise below 1.7 degrees Celsius, which is close to the ambitious target of the Paris Agreement.
The study is a sobering reminder that the costs of failing to curb climate change far outweigh the costs of transitioning to clean energy. As the world continues to delay concrete climate action, the consequences are no longer speculative – they are very real. They could wipe out a significant portion of the global economy in the coming decades. (Hartatik)
Banner photo: Image generated by OpenAI’s DALL·E via ChatGPT (2024)
