Natural Disasters May Lead To $12.5 Tn In Economic Losses

Amid the annual meeting at Davos, the World Economic Forum (WEF) on Tuesday has warned that climate-intensified natural disasters may lead to USD 12.5 trillion in economic losses and over two billion healthy life years lost by 2050.

A new WEF report stated that the looming climate crisis will exacerbate global health inequities, leaving the most vulnerable most at risk. Despite the stark findings, there is still time for global stakeholders to take decisive, strategic action to counter these forecasts and mitigate the health impacts of climate change globally.

The report, Quantifying the Impact of Climate Change on Human Health, developed in collaboration with Oliver Wyman mentioned that there is urgent global action must be taken to reduce emissions and safeguard human health from the multi-pronged negative impacts of climate change globally.

“While there has been much discussion about the impact of climate change on nature and the global economy, some of the most pressing consequences of the Earth’s rising temperatures will be on human health and the global healthcare system,” said Shyam Bishen, Head of the Centre for Health and Healthcare and Member of the Executive Committee, World Economic Forum.

Bishen stated that recent progress will be lost unless critical emission reduction and mitigation measures are improved, and decisive global action is taken to build climate resilient and adaptable health systems.

The report quantified the health consequences of climate change, both in terms of the health outcomes (mortality and healthy lives lost) and the economic costs to the healthcare system, estimated to be a further USD 1.1 trillion in extra costs by 2050. The analysis is based on scenarios developed by the Intergovernmental Panel on Climate Change (IPCC) on the most likely trajectory for the planet’s rising average temperature, 2.5° to 2.9° Celsius over pre-industrial levels.

Climate-driven health effects

The report analysed six major climate-driven event categories as key multi-pronged drivers of negative health impacts: floods, droughts, heat waves, tropical storms, wildfires and rising sea levels.

Floods were found to pose the highest acute risk of climate-induced mortality, accounting for 8.5 million deaths by 2050. Droughts, indirectly linked to extreme heat, are the second-highest cause of mortality, with an anticipated 3.2 million deaths. 

Heat waves take the highest economic toll at an estimated USD 7.1 trillion by 2050 due to the loss in productivity. Excess deaths attributed to air pollution, caused by fine particulate and ozone pollution are expected to be the largest contributor to premature death with almost 9 million deaths a year.

Climate change will also trigger a catastrophic rise across several climate-sensitive disease outcomes, including vector-borne disease, which will likely impact previously less affected regions such as Europe and the United States. By 2050, an additional 500 million people may be at risk of exposure to vector-borne diseases, the report revealed.

“The climate crisis is a health crisis, and it is driving a vicious cycle of disease, economic devastation and suffering. It is clear from this report that we are still to understand the full impact,” said Vanessa Kerry, Chief Executive Officer (CEO), Seed Global Health and WHO Special Envoy for Climate Change and Health. 

Kerry added, "If we fail to act, not only will the death toll be staggering but we also risk losing progress made over decades to improve health outcomes around the world. Countries least able to afford these shocks – and who contribute the least to global emissions – will be impacted the most.”

Increased inequality

The report warned that climate change will further entrench global health inequities, with the most vulnerable populations, including women, youth, elderly, lower-income groups and hard-to-reach communities, the most affected.

Regions such as Africa and southern Asia face heightened vulnerability to climate change impacts exacerbated by existing resource limitations, adequate infrastructure and essential medical equipment, further complicating their ability to address and adapt to environmental challenges.

Need for collaboration

Despite these stark findings, the new research shows that there is still time for global stakeholders to take decisive, strategic action to counter these forecasts and mitigate the health consequences of climate change. Intensified multistakeholder collaboration, across borders and industries, as well as a comprehensive transformation of the global health system to make it more resilient, adaptable and equitable will be crucial steps to achieve this.

"Our analysis sheds light on the profound impact of climate change on mortality, morbidity and the interconnected macroeconomic landscape, with healthcare systems alone likely having to bear an additional cost of USD 1.1 trillion due to climate change,” said Sam Glick, Global Leader of Health and Life Sciences, Oliver Wyman. 

“It is clear that we need sustained action if we are to mitigate the far-reaching consequences of climate change and ensure a healthy future for all," Glick mentioned.

Abhishek Sharma

BW Reporters Abhishek Sharma is a Correspondent with BW Businessworld.