What is the link between climate change and global inequality?

Since the concept was first developed several decades ago, climate change has been associated with increasingly common and disastrous weather events. While the physical consequences have been the main focus of the climate change debate, the economic inequality stemming from these cannot be ignored, and is becoming a central issue for policymakers.

Agriculture is still the economic cornerstone of many developing nations, yet as a sector particularly dependent on climate conditions it is one of the most at risk from climate change. According to a 2015 report from the World Bank, this susceptibility to climate change poses a threat to millions of people, and one that will especially be felt by the world’s poorest. In the report, the World Bank outlines the possible consequences of climate change should governments fail to pursue the necessary climate mitigation policies. The report makes for grim reading, predicting a world where the number of impoverished people rises from roughly 700 million to more than a billion people by 2030. 

Central to this increase is the impact of climate change on agriculture, resulting in both higher food prices and decreased production. This is due to the increased strain placed on crops from rising temperatures and droughts caused by changing weather patterns. This will hit the world’s poorest the hardest. In Sub-Saharan Africa and South Asia, two regions that the World Bank predicts will suffer the most, the poorest households spend close to 60 percent of their income on food, in comparison to the 10 percent spent by the wealthiest households. An increase in food prices would therefore risk driving an additional 73 million already struggling people into extreme poverty. 

Aside from the health risks associated with malnutrition, disease rates are also expected to rise. Through a small increase in temperature, it is estimated that the number of people at risk of malaria could increase by 5 percent, affecting over 150 million more people. Additionally, diarrhoea, which already kills close to 1.7 million people a year is expected to be more pervasive, and water quality and hygiene related illnesses will increase due to greater water scarcity.

While people in richer countries typically pay for about 20 percent of their medical expenses, with assistance from health insurance or government aid helping to bear the cost, people in poorer countries pay on average half of their medical bills out of pocket.

Much like the costs borne from higher food prices, it is expected that these diseases will have a much harsher impact on the poor in developing countries. While people in richer countries typically pay for about 20 percent of their medical expenses, with assistance from health insurance or government aid helping to bear the cost, people in poorer countries pay on average half of their medical bills out of pocket. All in, the cost of fighting these diseases is predicted to push a further 28 million people into extreme poverty. 

The World Bank’s report also highlights that there is still a great deal that can be done to avoid this future. Should the policies advised for through the “goals of extreme poverty eradication and shared prosperity” be reached by 2030, the result would be quite the opposite, with the number of people living in extreme poverty decreasing from the current figure of 700 million to just under 160 million, even accounting for “high-impact climate change” — yet there is still a long way to go before these targets can be met.

Unfortunately, one key issue still stands in the way of achieving the needed level of intergovernmental cooperation to bring about these changes. While the vast majority of governments are in agreement that climate change is a pressing issue requiring international action, there still remains much debate over who should be paying for it. 

Economic productivity peaks in places where the average annual temperature is around 13 degrees Celsius.

Recent reports have shed light on this issue by helping to quantify the impact that climate change has had on different national economies. For example, a study conducted by Diffenbaugh & Burke highlights the correlation between average annual temperature and economic output. In other words, economic productivity peaks in places where the average annual temperature is around 13 degrees Celsius, such as China and the USA. 

The further away from this ideal temperature a country is, the lower the productivity. This relationship was found to be constant across rich and poor countries, regardless of whether they were colder or hotter than the peak. Yet, the impact on productivity was especially detrimental where temperatures averaged above 20 degrees Celsius. 

In the context of climate change, this prompts a critical question: as the planet warms, do colder countries benefit at the expense of hotter countries? And beyond this, how much of the present day global inequality can be attributed to climate change?

While Sub-Saharan nations such as Sudan, Burkina Faso and Niger are all estimated to have a 20 percent deficit to GDP.

The economic gap between rich and poor countries has narrowed over the past few decades, with estimates suggesting a 15 percent decrease between 1975 and 2010. Yet it has been calculated that had it not been for global warming and the consequent impacts on economic productivity, the gap would be a further 25 percent smaller. Once again, the poorest nations are the most severely affected by this lost growth. Bangladesh’s GDP per capita is estimated to be 12 percent lower than it would be were it not for climate change, while Sub-Saharan nations such as Sudan, Burkina Faso and Niger are all estimated to have a 20 percent deficit to GDP per capita as a result of climate change.

While the poorest countries losing the most significant share of potential growth due to climate change may seem particularly unfair, this is further exacerbated by the fact that these countries have repeatedly been found to be the least responsible for the CO2 emissions that are putting their populations at risk. Meanwhile, rich pollutant countries are benefiting at their expense. Of the 19 countries with the highest pollution output examined by Diffenbaugh & Burke, 14 were found to have economically benefited from increased production due to warming. Conversely, the 18 countries with the lowest pollution rates lost close to 25 percent of potential GDP growth due to climate change.

While it has long been known that the countries most threatened by the risks of climate change are not those predominantly responsible for it, quantifications of the impact of climate change such as this one have only recently been discovered.

While it has long been known that the countries most threatened by the risks of climate change are not those predominantly responsible for it, quantifications of the impact of climate change such as this one have only recently been discovered.This argument has often been brought forth on the international stage, such as when Indian delegates called for “climate reparations” from wealthy countries during the Paris Climate Agreement in 2015. Yet as can be seen by Trump’s withdrawal from the Paris Agreement, the argument that rich countries should pay more to mitigate the impacts of climate change is not a popular one, and has led to the propagation of the idea that more developed nations are overpaying the cost of climate change action.

While these debates as to who should be footing the climate bill drag on with limited concrete action and a lack of binding agreements, it seems increasingly unlikely that poorer countries will receive the climate justice they deserve. Nevertheless, it remains evident that the issues of climate change and global inequality are increasingly one and the same, and the need for bold action on climate change is greater than ever. 

Yet as this argument continues, the clock ticks on, and the World Bank’s catastrophic 2030 climate scenario draws ever nearer.