Pakistan's GDP to take 20% hit until 2050 due to climate change - WB report

Risks of extreme climate change-induced events, environmental degradation, and air pollution are projected to reduce Pakistan’s GDP by at least 18 to 20% by 2050, World Bank Group’s Country Climate and Development Report (CCDR) for Pakistan reported.

The world bank report said that Climate change-induced disasters could significantly set back Pakistan’s development ambitions and its ability to reduce poverty.

According to the World Bank Group’s Country Climate and Development Report (CCDR) for Pakistan released today, the country needs fundamental shifts in its development path and policies to foster people-centric climate adaptation and resilience.

Pakistan has suffered from a climate change-induced heatwave, followed by devastating and outstanding floods that caused more than 1,700 deaths and displaced more than 8 million people. The destructive effects on infrastructure, assets, crops, and livestock have also been massive, with over 33 million people affected across the country and more than $30 billion in damages and economic losses, the report added.

Combined risks of extreme climate-related events, environmental degradation, and air pollution are projected to reduce Pakistan’s GDP by at least 18 to 20% by 2050, the report stated.

World Bank Vice President for South Asia Martin Raiser said that the recent flooding and humanitarian crisis provided a wake-up call for urgent action to prevent further devastation to the people of Pakistan and its economy. He added that accelerated climate actions can protect the economy from shocks and secure more sustainable and inclusive growth in Pakistan.

Until 2030, over 10 per cent of the cumulative GDP would be required to implement a climate-resilient and low-carbon development pathway. Reforms to expand domestic revenue mobilization, including raising new municipal and property taxes to finance urban investments are needed, the report recommended.

FC Regional Vice President for the Middle East, Central Asia, Türkiye, Afghanistan, and Pakistan Hela Cheikhrouhou said, “If we want to tackle climate change, we need to prioritize investing in adaptation to help prepare Pakistan for future climate-related calamities, which are growing in frequency and intensity.” “With the right policy frameworks, Pakistan has the opportunity to attract private investment to build its resilience, particularly in sectors such as water management, agriculture, urban infrastructure, municipal services, and housing.”

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Pakistan is not a significant contributor to global warming, but it is on a high-growth trajectory of carbon emissions linked to fossil fuel use. This is also a source of the country’s chronic fiscal stress and worsening air pollution. Therefore, climate actions that bring co-benefits to both adaptation and mitigation and contribute to improving development outcomes should have the highest priority.