Climate crisis: Failure to hit Paris agreement goals ‘could cost world $600 trillion’

The failure of nations to limit global temperatures from rising over 1.5C warmer than they were in the pre-industrial era could cost the world economy more than $600 trillion (£480 trillion) by the end of the century, new research warns.

According to the Intergovernmental Panel on Climate Change’s latest estimations, global temperatures are already on course to reach 1.5C of warming between 2030 and 2052, which would cause “dramatic damage”, the new research says.

In just 80 years’ time, our current trajectories mean the planet will warm by 3-4C, causing devastation and leading to millions of deaths.

But the researchers said if countries take concerted action to reduce emissions the world stands to gain economically.

The international team of climate experts simulated the costs of global cooperative action under a variety of scenarios. Writing in the journal Nature Communications, they forecast the planet could gain $336-422 trillion (£270-£338 trillion) by 2100, if action is rapidly taken to keep warming to 2C and 1.5C respectively.

The authors say earlier and quicker action will provide a better chance to avoid disaster, but it would mean higher costs in the short term.

They warn inaction on climate change will lead to “substantial socioeconomic losses”.

“We think that if every country or region can greatly enhance their actions for emission mitigation, it is possible to achieve the 1.5C,” lead study author Biying Yu, from the Beijing Institute of Technology told AFP.

“But implementing such a self-preservation strategy in the real word requires countries to recognise the gravity of global warming and to make breakthroughs in low-carbon technologies.”

The 2015 Paris agreement committed participating countries to curb and reduce their greenhouse gas emissions in order to keep global temperature rises “well below” 2C since the pre-industrial era.

The deal means each nation must, at a minimum, follow individual emissions reductions plans, known as nationally determined contributions (NDCs).

But there is a risk of countries not even hitting these modest targets. Such a failure could result in global losses the researchers say could range between $150 trillion and $790 trillion — roughly up to 7.5 times current global GDP.

“Without the upfront investment, emissions cannot be reduced, and the climate damage will occur with higher probability, which will result in huge economic loss,” Professor Yu said.

The authors found the total global decarbonisation investment would need to be $18-113 trillion, and would require major spending on renewable energy, electric vehicles, and other green technology.

More than 90 per cent of this should come from G20 nations, the authors said.

“If countries are well aware of the huge losses they will suffer if they don’t reduce emissions ... will they be more rational in making choices that will protect them, thereby boosting their response to climate change and driving the global climate governance process?” Professor Yu said.