MARKET ANALYSIS

CLIMATE CHANGE TO COST ISLAMABAD $26BN ANNUALLY, SAYS UN REPORT

Economic costs from the combined impacts of the disaster-climate-health nexus estimated by the United Nations Economic and Social Commission for Asia and the Pacific (UN-ESCAP) show that Pakistan will have the highest losses as percentage of GDP at 9.1%. In South and Southwest Asia, the total average annual loss is estimated to be $161 billion in the current climate condition. This estimate increases to $217bn under the moderate climate change scenario and to $322bn under the worst-case climate change scenario, says UN-ESCAP report, “Pathways to Adaptation and Resilience in South and Southwest Asia” released. In absolute terms, under the worst-case scenario, India is set to record the highest average annual loss at $225bn, followed by Pakistan at $26bn and Turkey at $24bn. However, when average annual loss is assessed as a percentage of the country’s GDP, under the worst-case climate change scenario, Pakistan will have the highest losses as percentage of GDP at 9.1pc, followed by Nepal at 8.7pc and India with estimated losses equaling 8.1pc of its GDP. Climate change is increasing the occurrence and intensity of natural hazard-induced disasters, leading to a reshaped riskscape for South and Southwest Asia. Over the past 50 years, natural hazards in South and Southwest Asia have affected over 3bn people and killed more than one million. The sub-region accounts for 44pc of all fatalities from disasters and 50pc of the people affected in the Asia-Pacific region. Climate change scenarios for the near and far future suggest that drought conditions are likely to become more severe in the region. The variation in rainfall pattern and projected higher temperatures will likely cause more frequent, extreme, dry conditions. Projected scenarios for 2040-59 show that multiple areas in India, Pakistan and Turkey are likely to experience a significant increase in the maximum number of consecutive dry days. The report warns that climate change will impact the lives and livelihoods of population dependent on dryland agriculture in South and Southwest Asia. The increase in mean temperatures in hyper arid and arid areas will have a significant impact on dryland agriculture in Afghanistan, India, Iran, Pakistan, and Turkey. In Pakistan, almost 77pc of the agricultural production in arid regions will be exposed. This could pose a threat to related livelihoods and food security in the country, the report says. ESCAP estimated a total annual adaptation cost of $61.5bn for South and Southwest Asia under the worst-case climate change scenario, from which $57.1bn is the adaptation cost for climate-related hazards and $4.4bn is the adaptation cost for biological hazards. At the country level, the highest total adaptation cost is recorded for India at $45.3bn, followed by Pakistan with $5bn and Bangladesh with $3.3bn.