Timor-Leste Economy Predicted to Be Among Worst Hit by Climate Change - ADB

The Pacific region could require up to $775 million or 2.5% of GDP per year to prepare for the worst scenario, according to a new report from the Asian Development Bank.

MANILA, PHILIPPINES – Economic losses from climate change could reach as much as 10% of Timor-Leste’s annual GDP by 2100, making it one of the worst hit in the Pacific, says a new Asian Development Bank (ADB) study.

“The scenarios presented in this report show that the immense gains Timor-Leste has made in its relatively short period of independence could be undone by an expected spike in temperatures and other negative climate change-linked events in the coming decades,” said Xianbin Yao, Director General of ADB’s Pacific Department.

Economics of Climate Change in the Pacific includes modeling of future climate over the Pacific region, assessments of the potential impacts on agriculture, fisheries, tourism, coral reefs, and human health, and predictions of the potential economic impact of climate change for specific sectors and economies under various emissions scenarios.

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Under a medium emissions scenario, Fiji, Papua New Guinea (PNG), Samoa, Solomon Islands, Timor-Leste and Vanuatu could see temperatures rise by 2-3°C by 2070, which could lead to significant decreases in rain-fed agriculture, reduced fish catches, widespread coral bleaching, and falling tourism numbers.

According to the report, the most significant economic losses would be felt in PNG, where climate change impacts could trigger a loss of up to 15.2% of its GDP by 2100. Potential losses to Timor-Leste’s economy could total as much a 10% of annual GDP, while potential losses estimated for other strongly affected countries include Vanuatu (at 6.2%), Solomon Islands (at 4.7%), Fiji (at 4.0%), and Samoa (at 3.8%).

Along with a temperature increase of up to 3°C in some areas, Timor-Leste could also see a sea level rise of up to 1.29 meters by 2100.

The report notes that the negative effect on agriculture contributes to most of the total economic cost of climate change in the Pacific, and estimates that the Pacific region could require $447 million on average until 2050, and up to $775 million or 2.5% of GDP per year to prepare for the worst scenario. The cost of adaptation would be significantly less under lower emissions scenarios.

The report recommends policy leaders take urgent action to mainstream climate change mitigation into development planning and develop forward-looking adaptation strategies. The report also recommends climate-proofing infrastructure to improve long-term sustainability and boosting capacity of Pacific countries to deal with climate change on their own. Pacific countries will also need dramatically improved access to global and regional climate change funds.