Study highlights socioeconomic impact of climate change in LDCs beyond 2°C warming

A new paper by the Centre for Global Development has reviewed a range of potential impacts that climate change could have on the socioeconomic status of developing countries. In particular, the report warns that if global warming is not limited to less than 2°C, revenue from crops could be cut by 30%, losses in GDP could range between 11.2% and 26,6%, and 50 million more Africans will experience water stress.

Because of the effects of climate change, extreme weather events that only occurred once in ten years are now already occurring 2.8 times in ten years, and this will increase to 4.1 times in ten years if the global temperature increases by 1,5°C on average. The rising frequency of extreme weather will have an impact on the natural world, and because humanity depends on ecosystems and a stable climate, these disruptions can be expected to negatively impact on broad sectors of the economy, human health, and water resources.

Developing countries in particular carry with them the risk that their economies have a low adaptive capacity, as the food, water, health, and infrastructural systems which are in place can be expected to be weakened.

To come to their conclusions, the researchers conducted a literature review of existing studies on topics related to climate change in combination with existing studies on topic related to socioeconomic indicators such as economic growth, income, poverty, welfare, health, agricultural productivity, and water resources. Ultimately, the research brought together evidence from 139 studies, most of which had been published after 2017. The studies had a mixed geographical focus, i.e. there was a combination of global studies with country specific studies. Similarly, there was a mixture of the socioeconomic themes that the studies covered, even if a very large proportion of the studies highlighted the impacts of climate change on agricultural productivity.

Across different studies there are differences in the models used to project the economic impact of climate change, and the economic impact also depends on the severity of the climate change that can be expected under different emissions scenarios. Nevertheless, the different models tend to agree that the economic impact increases strongly with an average temperature increase above 2°C. At that point, the annual percentage reduction in Gross Domestic Product (GDP) per year is predicted to be around 2%.

The socioeconomic impacts of climate change do appear to depend on the region. At the global level, studies shows that the overall impact of climate change on agricultural production is likely to be relatively small. However, some areas such as North America and the former Soviet republics can expect production gains as a result of climate change, while in Western Europe and most developing countries, climate change will reduce agricultural GDP.  Nevertheless, at the global level, significant price increases can be expected for key products such as rice and maize, which will have a socioeconomic impact through reduced buying power.  

The authors stress that the management of water resources is critical for achieving sustainable development. They quote the World Meteorological Organisation’s 2022 State of Global Water Resources Report which states that whereas currently, about 3.6 billion people in the world face inadequate access to water resources at least a month per year, by 2050 this number is expected to rise to 5 billion people. In general, higher global temperatures are expected to translate into drier conditions with diminishing surface and groundwater conditions. However, the picture is generally mixed and complex at the regional level, with some areas experiencing heavy precipitation and flooding – such as during monsoon periods or under the influence of tropical cyclones. Other areas – such as the horn of Africa - have experienced severe drought.   One study suggests that climate change increases water resource stresses in some parts of the world (the Mediterranean, parts of Europe, Central and Southern America, and Southern Africa) while in some parts of the world average runoff is likely to increase (South and South East Asia).