Climate change could possibly cost Latin America 16 percent of its GDP by the end of the century, unless new policies to control its impacts were implemented, according to a report issued by Moody’s Analytics on Monday.
The report included costs of climate change’s physical impacts, like infrastructure damage and poorer health, and costs of policy interventions aimed at reducing its impacts.
The GDP could keep deteriorating if no action was taken, causing a loss of ten percent by 2075, reaching 16 percent by the end of the century, Moody’s added, calling it a nightmare scenario.
“Latin American countries that would be more affected by climate change are the main fossil fuel producers and consumers: Venezuela, Colombia, Brazil and Mexico,” the report stated.
The continent’s economy is faced with three paths to control the aforementioned losses; taking immediate policy actions that target zero emissions by 2050, delaying policies until 2030 then picking up the pace, or no new policies to control climate change, according to Reuters.
The early policy path is Latin America’s best option as it can have the lowest losses, while inflation can reach its highest recorded rate in 50 years, Moody highlighted.
Output losses can accelerate and get worse between 2030 and 2060, as decarbonization advances, and inflation keeps growing.
