The world’s most climate vulnerable islands including Jamaica, Fiji and Samoa, face a spiralling bill for economic loss and damage tied to extreme weather events, according to the first ever study into the indirect costs of climate driven loss and damage in the most acutely vulnerable nations on the planet – Small Island Developing States.
A study by the ODI Global think tank, released ahead of the COP29 conference in Azerbaijan, is based on two decades of data on extreme weather events and forecasts of future loss and damage for climate warming scenarios by 2050: 1.5°C and 2.0°C above pre-industrial levels.
The research finds that cumulative costs of US$6.1 billion annually from extreme weather in small islands states from 2000-2022 can be attributed to climate change – that’s almost 1 percent (0.9 percent) wiped off their GDP. The cumulative costs could be up to US$75.2 billion by 2050 under a 2.0°C scenario, for the 35 island nations studied, identified as some of the world’s the most climate vulnerable by the UN.
Current pledges amounting to US$680 million in the Loss and Damage Fund’s bank account would cover just 20 percent of what small island nations might need in a single year, and vastly less than will be required annually by all vulnerable countries affected by climate loss and damage.
The warning to wealthy nations that their climate finance pledges are falling short in this critical new area of climate policy comes as leaders and diplomats from Caribbean and Pacific islands hard hit by floods and tropical cyclones, appealed for promises to tackle climate change by polluting nations to be honoured.
Emily Wilkinson, Principal Researcher at ODI Global and co-director of the Resilient and Sustainable Islands Initiative said: “Small Island nations are the canary in the coal mine for humanity. Given the relatively small size of their economies, the increasing loss and damage from climate change represents a catastrophic scenario for many island economies and people. Island nations will be seeking billions more in pledges from Annex 1 wealthy nations for the loss and damage fund, a new climate finance goal that includes loss and damage, and an end to the cynical foot dragging by some Governments, who haven’t yet lived up to their historic responsibilities.”
Professor of Economics of Climate Change Ilan Noy adds that: “The increasingly intense extreme weather events are destroying a lot of homes and infrastructure in small island nations, and that destruction has consequences that reduce growth for years later. It is thus imperative that the wealthy nations provide the resources for these nations to avert these prolonged costs caused by a problem that they have done nothing to create.”
The report authors, ODI’s Drs Vikrant Panwar and Emily Wilkinson and Professor Ilan Noy, the Te Āwhionukurangi Chair in the Economics of Disasters and Climate Change at Victoria University of Wellington explain in The Conversation how this study on previous climate-attributable loss and damage estimates for SIDS by calculating the ‘indirect losses’ from extreme weather, producing for the first time an estimate of lost GDP growth and fiscal impacts.
Some nations, particularly the 39 Small Island Developing States, which include places like Barbados, Grenada, Fiji and Vanuatu, have paid the highest price for increasing global temperatures.
Other islands, like the Maldives, Kiribati and the Marshall Islands appear less affected under the methodology used in this study, but these atoll island nations also face as-yet uncosted loss and damage from slow onset events like sea level rise, coastal erosion, loss of freshwater resources, and the degradation of vital coral reefs and fish stocks due to ocean temperature increases.
Call from small island states
On the eve of COP29 leaders and diplomats from Small Island Developing States have renewed their demand for every high emission nation responsible for man-made climate change to pay their fair share into the loss and damage fund.
Permanent Representative of the Dominican Republic to the United Nations, Ambassador José Blanco, said: “For over a decade we have been hit by a hurricane or flooding every year. Thousands of people have had their lives ruined and are facing a long road to recovery. We insist that the commitments and promises made must be delivered, especially by the polluting nations, to help SIDS recover from increasingly intense storms, whilst also supporting vulnerable nations to adapt and build resilient economies.”
Sivendra Michael, Permanent Secretary in the Ministry of Environment and Climate Change, Government of Fiji, said: “It is essential that the international community takes the findings of this report seriously. The evidence is clear, addressing loss and damage must be front and centre and additional financing for loss and damage is required to ensure our finite resources do not continue to be diverted away from long term investments in resilience to manage the burden of unavoidable loss and damage. The commitments to the fund thus far are a drop in the ocean and are nowhere near enough to assist nations devastated by climate change to get back on track.”
CASE STUDY: FIJI
The island of Fiji, best known as a tropical paradise, suffered the devastating impacts of tropical cyclone Winston in 2016. A category 5 storm, Winston was one the most intense on record in Fiji, causing widespread flooding and leading to the loss of a third of GDP overnight, leaving billions in damage, which is yet to be fully addressed.
Cyclone Winston also reduced Fiji’s GDP growth by an estimated 1.4 percentage points, and this isn’t an isolated problem. Recent estimates suggest tropical cyclones and flooding may be costing Fiji $500m (US$250 million) a year.
