Hurricanes, thunderstorms, floods and winter storms are already hurting GDP by nearly 0.4% in the United States alone, according to a Swiss Re study, which reaffirms that climate change could reduce global growth by 7 to 10 % by 2050.
Currently, however, the Philippines is the country where the impact of natural disasters on gross domestic product (GDP) is the highest, representing a shortfall of 3% in terms of economic growth, according to this study published Wednesday which is based based on 2022 data.
“Climate change is leading to more severe weather events, which translates into a growing impact on economies,” said Jérôme Jean Haegel, Swiss Re’s chief economist, quoted in the press release accompanying the study.
To understand how insurers can assess risks, this study sought to take stock of the impact of the most frequent natural disasters on the domestic product of a sample of 36 countries.
The economists of this group which serves as an insurer for insurers took into account floods, winter storms, tropical cyclones and severe convective-type storms (thunderstorms), which are the four most frequent types of weather incidents and the most expensive.
By this yardstick, the Philippines stands out as the country that is already the most affected today, followed in second place by the United States, then by Thailand with an impact of 0.36% on GDP, Austria (0.25% of GDP) and China (0.22% of GDP).
In France, the impact on GDP amounts to 0.14%, the same level as in Belgium and Germany.
This assessment provides an overview of the economic implications if weather incidents continue to intensify but does not reflect all the risks, Swiss Re economists warn, with the true extent of climate change “remaining difficult to predict”, they insist.
It does not take into account, for example, heatwave episodes, explain Swiss Re economists, who limited themselves to the most costly weather incidents to be able to carry out calculations.
Globally, these four risks alone represent around $200 billion (€184 billion) in economic losses each year.
If reducing greenhouse gas emissions is “essential”, underline Swiss Re economists, it is also “imperative”, according to them, to take measures to help stem economic losses, such as reviewing codes and building regulations, build flood defense systems and discourage building development in areas most exposed to climate change.
