MANILA, Philippines - Adapting to the impact of global warming in developing countries is set to cost up to $100 billion a year over the next 40 years, according to a new World Bank study.
The Economics of Adaptation to Climate Change (EACC) study, funded by the governments of the Netherlands, Switzerland, and the United Kingdom, is the most in-depth analysis of the economics of adaptation to climate change to date and uses a new methodology for assessing these costs.
The preliminary findings of the EACC study that was presented yesterday at United Nations climate change talks in Bangkok estimated the expense under two alternative future climate scenarios – “dry” and “wet” – with adaptation measures costing $75 billion annually in the relatively dryer scenario and $100 billion for the wetter climate picture every year from 2010 to 2050.
The WB underscored the need for developing nations to prepare for large-scale infrastructure costs, disease and huge losses in agricultural productivity as the potential consequences of unchecked climate change.
The report was released at the penultimate round of UN-backed negotiations before world leaders meet in the Danish capital Copenhagen in December to hammer out a new greenhouse gas reduction treaty to succeed the 1997 Kyoto Protocol.
According to the report, the highest adaptation costs will be borne by the East Asia and Pacific Region, followed closely by Latin America and the Caribbean, and sub-Saharan Africa.
The drier scenario requires lower adaptation costs in all regions, except South Asia.
The new approach involves comparing a future world without climate change with a future world with climate change.
The difference between these two worlds entails a series of actions to adapt to the new world conditions. The costs of these additional actions are the costs of adapting to climate change.
The WB study makes plain that taking action in favor of adaptation now can result in future savings and reduce unacceptable risks.
At this point, the costs can still be borne by the international community, to judge by the GDPs of rich countries, but for poor countries they are unacceptably high.
More than ever, mitigation, adaptation and development cooperation are needed to make the poor less vulnerable to climate change.
The WB said international public financial support for adaptation in the poorest developing countries should be new and additional, “so as not to jeopardize the Millennium Development Goals (MDGs).”
The EACC study has two broad objectives. The first is to develop an estimate of the global costs of adaptation in developing countries.
The second is to help decision makers in developing countries to better understand and assess the risks posed by climate change and to better design strategies to adapt to climate change, particularly keeping the most vulnerable communities in focus.
A second report, based on seven country case studies, will be produced by 2010, focusing on the second objective.
The report released Thursday stressed that development strategies must maximize flexibility and incorporate knowledge about climate change as it is gained.
It also finds that adaptation costs decline as a percentage of GDP over time, suggesting that countries become less vulnerable to climate change as their economies grow.
In the study, adaptation costs for all developing countries are estimated for the major economic sectors using country-level data sets that have global coverage, including partial assessment of costs of adaptation for ecosystem services.
Cost implications of changes in the frequency of extreme weather events are also considered.