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Climate change will reduce the world’s income – Expert Reaction

Climate change is projected to reduce the income of the global economy by 19% by 2049, and Aotearoa will be among the countries feeling the pinch.

An international study projects that NZ’s income will be 2-10% lower than if there was no climate change, with much of the impacts arising from changes to average temperatures and annual rainfall.

Professor Ilan Noy, Chair in the Economics of Disasters and Climate Change, Victoria University of Wellington, comments:

“The authors of this paper clearly show that the transition to sustainable energy sources is significantly less costly than the cost we are already ‘committed’ to bearing by our past greenhouse emissions, so we would have been much better off had we not delayed climate action for so long.

“Overall, however, this kind of modelling approach is not suitable to conclude much about the costs of climate change at the local level for us in Aotearoa. This approach does not account for the local peculiarities of our economic activities (in our case, for example, that the Waikato region is much more exposed to changes in heat and rainfall than Auckland because of its different set of economic activities).

“But, the fact we cannot conclude much from this work about the local impact does not detract from the main message, that we should rapidly converge to a net-zero world. Afterall, the argument for us, and for everyone else around the world, to work toward net zero is not that our actions matter locally, but that it is their global impact that is the reason for the urgency we need to adopt.”

No conflict of interest declared.