How strong are the effects of the environmental crisis on GDP and the economy?

It is true to say that the climate change It is a situation that has affected everyone indiscriminately and in various aspects, such as quality of life, health, access to resources and, of course, the economy.

But, Has climate change really negatively affected finance and trade that move around the planet? The question is valid and, to answer it, there are several investigations that can prove it.

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One of these was carried out by the United States National Bureau of Economic Research (NBER).

The report of this federal entity assures that An increase of one degree Celsius (°C) in global temperature can mean a 12% drop in global gross domestic product (GDP) for the world..

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This data is relevant considering that the global temperature has been increasing above 1 °C in recent decades if counted from the beginning of the pre-industrial period (stage that began at the end of the 18th century, prior to the industrial revolution).

According to experts, this increase can shoot up to 3 °C by the end of the 21st century if the situation remains as it is.

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Climate change

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To detail the effects of climate change on the world economy, the NBER report clarifies that this environmental situation can generate a “abrupt drop in production, capital and consumption, which will exceed 50% in 2100“. This suggests that “People could be 50% poorer than they would be without climate change“.

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This document also compares the possible economic disaster caused by climate change with the “economic damage caused by waging an internal and permanent war”, referring to the environmental effects of armed conflicts that are in belligerencesuch as the Russian invasion of Ukraine or the war between Israel and Hamas in the Gaza Strip.

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