Climate-smart development can generate up to $2.6 trillion: World Bank

climate changeAmid mounting concerns about the negative impact of climate change on economic stability, researchers at the World Bank are optimistic that climate-smart development can increase global output by $1.8-2.6 trillion. “Climate change poses a severe risk to global economic stability, but it doesn’t have to be like this,” said World Bank Group President Jim Yong Kim.

In a new report:Climate-Smart Development: Adding Up the Benefits of Actions that Help Build Prosperity, End Poverty and Combat Climate Change, released on June 24, the World Bank’s experts explain that investment in climate-smart development projects has various co-benefits.  Projects that fight climate change also improve communities, save lives, and increase GDP.

The report focused mainly on five large countries – Brazil, China, India, Mexico, and the United States – plus the European Union. It used an innovative framework to study seven “simulated” case studies – three dealing with sector policies and four focused on project level interventions – to calculate the multiple benefits of air pollution reduction.  The sector policies, as documented in the report, included implementing policies on clean transportation, energy efficiency in industry, and energy efficiency in buildings.

The World Bank’s projections are upbeat: by 2030 a GDP growth of $1.8 trillion-$2.6 trillion per year, 32 million tonne growth in crop production, reduction of 8.5 gigatons of CO2-equivalent and almost 16 billion kilowatt-hours of energy saved.It would also save over 94,000 lives annually.

The report also studied specific projects in growing economies like Brazil, China, India, and Mexico to estimate the benefit of scaling local development interventions to the national level.

The case study based in India found that developing sustainable transportation through the construction of more than 1,000 km of new bus rapid transit lines deployed in about 20 large cities could add 44,000–91,000 short-term and more than 128,000 permanent jobs. In addition to this other co-benefits include an increase of $11.5–$13.5 billion between 2013 and 2032 in India’s GDP, saving 27,200–31,200 lives.

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