Long-term Cost of Climate Change
18 to 20% of GDP will likely be lost due to climate change by 2050 (in the optimistic and pessimistic scenarios, respectively) as increased floods and heatwaves reduce agriculture and livestock yields, destroy infrastructure and decrease labor productivity in Pakistan. World Bank
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The combined risks from intense climate change and environmental degradation, unless addressed, will further aggravate Pakistan's economic fragility; and could ultimately reduce annual GDP by 18 to 20% per year by 2050, based on the optimistic and pessimistic scenarios, respectively, as revealed in World Bank's country climate and development report for Pakistan. This will stall progress on economic development and poverty reduction.
Although this is a simplified view that aggregates the modeled impacts of selected climate threats, water insecurity, and air pollution on real GDP, the modeling exercise in the report does highlight the potential magnitude of impacts, laying out some transmission channels. The risks and possible impacts are a very real threat to Pakistan's sustainable and equitable growth path, which has been demonstrated by the immediate and likely longer-term costs of the tragic floods of 2022.
Pakistan is not a significant contributor to global warming, but it is on a high-growth trajectory of carbon emissions linked to fossil fuel use. This is also a source of the country’s chronic fiscal stress and worsening air pollution. Therefore, climate actions that bring co-benefits to both adaptation and mitigation and contribute to improving development outcomes should have the highest priority.
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Aggregated Impact on GDP Associated with Climate and Environmental Threats by 2050
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