“Uncovering the Economic Impact of Climate Change: How Much Will It Drag Down the Economy?”

The aftermath of Category 5 Hurricane Otis in Acapulco, Mexico, paints a grim picture of the potential economic impacts of climate change. The devastation caused by the hurricane left the once-glamorous resort town in ruins, with 80% of hotels damaged and at least 50 people dead. Six months later, the city was still struggling to recover, with many buildings abandoned and tourism slow to return.

Economists warn that as the climate warms and extreme weather events become more frequent, similar scenarios could unfold in other parts of the world, leading to significant economic losses. The debate among experts centers on whether these climate-related damages will have a one-time impact that can be quickly recovered from, or if they will create a persistent drag on the economy.

Studies have shown that climate change can affect the economy in various ways, from reducing labor productivity due to high temperatures to disrupting supply chains and causing production delays. The costs of climate damages go beyond just economic metrics like GDP, encompassing factors like stress, trauma, and lost cultural and natural resources.

Estimates of the economic impacts of climate change vary widely, with some studies suggesting that global GDP could be reduced by 5-15% by 2100 if no action is taken. However, other research indicates that meeting the targets set out in the Paris climate agreement could lead to better economic outcomes.

Ultimately, the consensus among experts is that preventing future climate change is far more cost-effective than dealing with its consequences. Countries need to implement more ambitious climate policies to mitigate the economic impacts of climate change and ensure a sustainable future for all.