Climate change is a threat multiplier, with the potential to push millions into poverty in the coming years and undo hard-won development gains.
- The threat of climate change remains critical for countries – forcing people to evacuate homes, grapple with food insecurity or the impacts of deforestation and biodiversity loss – even as they also deal with the health and economic impacts of COVID-19.
- Natural disasters cost about $18 billion a year in low- and middle-income countries through damage to power generation and transport infrastructure alone.
- They also trigger wider disruptions for households and firms costing at least $390 billion a year.
- The most vulnerable countries are at particularly high risk of seeing their existing health systems overloaded or wiped out; having emergency funds depleted and replenishment more challenging in a constrained fiscal space; and, facing rising economic vulnerabilities of people and communities.
Countries now have a once-in-a-generation chance to set themselves on a sustainable, inclusive and resilient development path.
- Making the right investments now can unlock short term gains – jobs and economic growth – as well as deliver longer term benefits for people, including decarbonization and resilience.
- Low-carbon stimulus programs can drive new jobs that are sustainable, inclusive and equitable.
Countries can unlock new economic opportunities and jobs through climate action.
- Investing in resilient infrastructure in developing countries could deliver $4.2 trillion over the lifetime of new infrastructure. An investment of $1, on average, yields $4 in benefits.
- Making infrastructure more resilient avoids costly repairs and minimizes the wide-ranging consequences of natural disasters for the livelihoods and well-being of people.
- A shift to low-carbon, resilient economies could create over 65 million net new jobs globally out to 2030.
Climate action helps countries develop sustainably. When countries act on climate change, they will also benefit from clean air and water, healthy oceans, resilient cities, sustainable food and agriculture systems.
- The Bank has supported the governments of Mexico and Colombia to adopt carbon taxes, which maximize synergies between air pollution management and climate change mitigation.
- In Vietnam, we supported investments in water infrastructure to mitigate the impacts of flooding and saline intrusion and to protect water resources for agriculture, benefiting 215,000 farmer households.
- 9 million people have benefited from climate-smart crops and technologies, through the West Africa Agricultural Productivity Program. Yields and incomes for farmers have grown by an average of 30%, improving food security for about 50 million people in the region.
- The Bank’s work on urban development has been instrumental in building resilient cities. For example, the World Bank helped the city of Beira in Mozambique strengthen its resilience to weather-related hazards; rehabilitating its storm water drainage system and installing flood control stations and a water retention basin. When Cyclone Idai hit in March 2019, Beira faced less damaging flooding than other parts of the country.
Scaling up finance quickly is critical but public budgets alone are not enough. In addition to direct financing, the World Bank Group is also responding to country demand by mobilizing private investment and helping open low-carbon markets where they didn’t previously exist.
- Along with other MDBs and the Climate Investment Funds, the Bank has supported the world’s largest concentrated solar power complex in Morocco. Generating 580 megawatts (MW) of clean energy, the Noor complex will soon produce clean power for 1.1 million Moroccans, while also accelerating global interest in this technology.
- India is one of the first countries to deploy highly efficient air conditioners at scale through a bulk procurement program by Energy Efficiency Service Limited (EESL). An initial bulk procurement of 100,000 AC units, with 30% greater efficiency than the market average, led to a 15% reduction in price. The World Bank has an ongoing engagement and supports EESL through technical assistance and lending.
Policies, such as carbon pricing, can help create incentives for transformational change.
- Carbon pricing represents a simple, flexible, low-cost, fair and efficient policy option to address climate change. It can also deliver additional benefits, reducing air pollution and congestion while avoiding the increased costs of remedial measures associated with high-carbon growth paths. For businesses, carbon pricing enables them to manage risks, plan their low-carbon investments, and drive innovation.
- As of November 1, 2019, 46 national jurisdictions and 31 subnational jurisdictions are implementing or have scheduled for implementation initiatives to put a price on carbon. For the latest information, visit the Carbon Pricing Dashboard, an interactive online platform that builds on the data and analyses of the annual State and Trends of Carbon Pricing report series.
Last Updated: Sep 30, 2020