A new study from the Potsdam Institute for Climate Impact Research (PIK) backed by the German government has revealed alarming projections on the economic impact of climate change. According to the research, damage from climate change is estimated to cost a staggering $38 trillion per year by 2050, with the potential to shave off 17% of the global economy’s GDP.
The study, led by climate data researcher Leonie Wenz, emphasizes the urgent need for action to mitigate the effects of climate change. Wenz stated, “The world population is poorer than it would be without climate change. It costs us much less to protect the climate than not to.”
The report highlights that the cost of measures to limit global warming to within 2 degrees Celsius by 2050 would be significantly lower than the estimated damage caused by allowing temperatures to exceed that threshold. Additionally, the research found that almost all countries would suffer economically from climate change, with developing nations being hit the hardest.
The study’s estimation of damage is based on projected temperature and rainfall trends, but does not account for extreme weather events or other climate-related disasters. If emissions continue at current rates and global temperatures rise beyond 4 degrees Celsius, the economic toll after 2050 could result in a 60% income loss by 2100.
The findings underscore the importance of taking immediate and decisive action to address climate change and its economic consequences. Failure to do so could have devastating effects on the global economy and the well-being of populations around the world.