Vanuatu's Climate Change Losses Could Exceed 6% of GDP by 2100 - 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 – A new Asian Development Bank (ADB) report looking at the effects of climate change in the Pacific region shows that a substantial rise in temperatures on the larger islands of Malampa, Penama and Sanma is highly probable, bringing with it a detrimental impact on agriculture, with spillover effects on the broader economy.

“Vanuatu’s economy is predicted to be among the hardest hit by climate change in the Pacific region,” said Xianbin Yao, Director General of ADB’s Pacific Department. “Urgent action is needed to adapt and protect sectors such as agriculture and fisheries from the worst effects of climate change.”

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. Timor-Leste’s GDP is predicted to drop by up to 10%, followed by Vanuatu at 6.2%, Solomon Islands at 4.7%, Fiji at 4.0% and Samoa at 3.8%.

Along with more extreme temperatures on its larger islands, Vanuatu could experience a sea level rise of up to 1.36 meters by 2100. However, unlike other countries, extreme rainfall is expected to decline under future climate scenarios.

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 lower 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.