THE TEMPERATURE of the Earth’s surface is rising, and no country will be spared the consequences. Many countries will experience the direct impact of climate change, such as more frequent (and damaging) natural disasters, rising sea levels, and biodiversity loss. But low-income countries will suffer the most from this global threat, despite having contributed very little to the problem. And within these countries, the poor will likely be the most severely affected.
Domestic policies can help offset the impact of weather shocks. Strategies aimed at helping countries adapt—such as climate-resilient infrastructure projects, adoption of appropriate technologies, and mechanisms to transfer and share risks through financial markets—could help reduce the economic damage caused by weather shocks or climate change.
But implementing such policies is difficult in low-income countries, which have large spending needs already and limited scope to find the resources necessary to fight climate change. And domestic policies alone cannot fully insulate low-income economies from its adverse effects; climate change is a global problem, and only collective action can effectively address it.
Mitigating climate change would entail radically transforming the global energy system, including through the use of fiscal instruments to better reflect environmental costs in energy prices and promote cleaner technologies. Adapting to the consequences of climate change calls for major investments to boost infrastructure, reinforce coastal zones, and strengthen water supplies and flood protection.
The international community will have a key role to play in fostering and coordinating support—financial and otherwise—for affected low-income countries. The richer economies have contributed the lion’s share to actual and projected climate change. Helping poorer countries cope is thus both a humanitarian imperative and sound global economic policy.
Prepared by MARIA JOVANOVIĆ. Text and charts are based on Chapter 3 of the IMF’s October 2017 World Economic Outlook.
ART: ISTOCK / IKRYANNIKOVGMAILCOM, ILYALIREN, JABKITTICHA, CDH_DESIGN, SHOWVECTORSTUDIO