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The Caribbean and Climate
Change: The Costs of Inaction
Ramón Bueno
Stockholm Environment Institute-U.S.
www.sei-us.org
www.sei-us.org/climate-and-energy/climate-economics.html
Climate Change:
From the Science to Action
• Scientific consensus on climate change
• The debate now is about the economic analysis
• Wide range of economic models
– Uncertainty, catastrophic risks,
– Discount factors, growth rates, technology
Need for Climate Action
• Some say acting now will be costly
• Climate inaction will be even more costly
• Global trends and pressures
– World’s 6 billion people: 9B by 2100
– Right to development
Caribbean Vulnerability
Infrastructure losses and coastal erosion
Tourism loss
Greater hurricane, storm surge damages
Salt water intrusions into fresh-water aquifers
Agriculture and ecosystems losses
Impaired health (flooding, sanitation, diseases, heat stress)
Challenges:
Ecological
Social
Economic
Security
Food
Energy
Caribbean Costs of Inaction
“For just these three categories—
increased hurricane damages, loss of
tourism revenue, and infrastructure
damages—the Caribbean’s annual cost
of inaction is projected to total $22
billion annually by 2050 and $46
billion by 2100. These costs represent
10 percent and 22 percent, respectively,
of the current Caribbean economy.“
Action vs. Inaction Scenarios
2050 2100
Annual Average Temperature Increase (in degrees above year 2000 temperature)
Low-Impact F 1.1 2.2
C0.61.2
High-Impact F 4.9 9.7
C2.75.4
Sea-Level Rise (above year 2000 elevation)
Low-Impact in 3.5 7.1
cm 8.9 18.0
High-Impact in 22.6 45.3
cm 57.4 115.1
Climate Change Scenarios
Total Caribbean Climate Change Scenarios: $US Billions
(billions of 2007 dollars; percentages based on 2004 GDP)
LOW-
IMPACT 2050 2100
Storms 2.0 2.1
Tourism 0.8 1.6
Infrastructure 2.9 5.9
Total $5.7 $9.6
% Current GDP 2.7% 4.5%
HIGH-
IMPACT 2050 2100
Storms 4.7 10.0
Tourism 4.0 8.0
Infrastructure 18.9 37.8
Total $27.6 $55.8
% Current GDP 13.0% 26.3%
Caribbean Cost of Inaction:
Total Caribbean Cost of Inaction ($US Billions)
(billions of 2007 dollars; percentages based on 2004 GDP)
2050 2100
Storms 2.8 7.9
Tourism 3.2 6.4
Infrastructure 15.9 31.9
Summary: Costs of Inaction $21.9 $46.2
in billions of 2007 dollars
as percent of Caribbean GDP 10.3% 21.7%
Cost of Inaction by Island
Cost-of-Inaction: % of 2004 GDP 2050 2100
Anguilla 20.7 41.4
Antigua & Barbuda 25.8 58.4
Aruba 10.1 20.1
Bahamas 13.9 31.7
Barbados 13.9 27.7
British Virgin Islands 9.0 18.1
Cayman Islands 20.1 53.4
Cuba 12.5 26.8
Dominica 34.3 77.3
Dominican Republic 19.6 40.3
Grenada 46.2 111.5
Guadeloupe 4.6 9.5
Haiti 61.2 123.2
Jamaica 27.9 56.9
Martinique 3.8 8.1
Montserrat 21.7 49.5
Netherlands Antilles 16.1 36.0
Puerto Rico 2.8 6.0
Saint Kitts & Nevis 35.5 89.3
Saint Lucia 24.3 49.1
Saint Vincent & the Grenadines 23.6 47.2
Trinidad & Tobago 8.0 16.0
Turks & Caicos 37.9 75.9
U.S. Virgin Islands 14.2 32.4
TOTAL CARIBBEAN 10.3% 21.7%
CaribbeanCostofInaction‐‐by%TotalImpactin210
0
(millions of 2007 dollars; percentages based on 2004 GDP)
GDP Storms Tourism Infrastr. Total Storms Tourism Infrastr. Total
Haiti 4,378$ 2.4% 0.8% 120.0% 123.2% 107 36 5,252 5,394$
Grenada 391$ 63.0% 7.8% 40.7% 111.5% 247 31 159 436$
SaintKitts&Nevis 359$ 60.5% 8.5% 20.3% 89.3% 217 31 73 321$
Dominica 249$ 28.8% 5.0% 43.5% 77.3% 72 12 108 193$
Turks&Caicos 181$ 0.0% 52.3% 23.6% 75.9% ‐ 95 43 137$
Antigua&Barbuda 750$ 22.7% 16.4% 19.3% 58.4% 170 123 145 438$
Jamaica 8,773$ 3.3% 6.8% 46.8% 56.9% 292 593 4,106 4,991$
CaymanIslands 2,204$ 43.7% 6.3% 3.5% 53.4% 963 138 76 1,178$
Montserrat 34$ 20.2% 8.0% 21.3% 49.5% 7 3 7 17$
SaintLucia 699$ 1.6% 12.1% 35.4% 49.1% 11 85 247 343$
SaintVincent&theGrenadines 371$ 0.0% 9.5% 37.7% 47.2% ‐ 35 140 175$
Anguilla 120$ 0.0% 25.5% 15.9% 41.4% 0 31 19 50$
DominicanRepublic 20,519$ 4.0% 5.6% 30.8% 40.3% 814 1,144 6,318 8,276$
NetherlandsAntilles 2,705$ 12.6% 11.0% 12.5% 36.0% 341 296 338 975$
U.S.VirginIslands 3,104$ 13.3% 13.6% 5.5% 32.4% 414 422 170 1,005$
Bahamas 5,786$ 12.9% 10.8% 7.9% 31.7% 748 627 458 1,833$
Barbados 2,538$ 0.1% 11.0% 16.6% 27.7% 1 280 422 704$
Cuba 38,065$ 5.8% 2.0% 19.1% 26.8% 2,197 761 7,256 10,214$
Aruba 2,347$ 0.0% 13.8% 6.3% 20.1% ‐ 323 149 472$
BritishVirginIslands 967$ 0.4% 14.2% 3.4% 18.1% 4 138 33 175$
Trinidad&Tobago 12,610$ 0.0% 1.0% 15.0% 16.0% 0 127 1,892 2,020$
Guadeloupe 8,623$ 1.2% 0.6% 7.7% 9.5% 101 52 667 820$
Martinique 9,896$ 1.4% 0.7% 6.0% 8.1% 137 67 596 800$
PuertoRico 86,726$ 1.2% 1.1% 3.7% 6.0% 1,055 970 3,202 5,227$
TOTALCARIBBEAN 212,397$ 3.7% 3.0% 15.0% 21.7% 7,899$ 6,418$ 31,876$ 46,193$
%ofGDP $Million
CaribbeanCostofInaction‐‐by%TourismImpactin2100
(millions of 2007 dollars; percentages based on 2004 GDP)
GDP Storms Tourism Infrastr. Total Storms Tourism Infrastr. Total
Turks&Caicos 181$ 0.0% 52.3% 23.6% 75.9% ‐ 95 43 137$
Anguilla 120$ 0.0% 25.5% 15.9% 41.4% 0 31 19 50$
Antigua&Barbuda 750$ 22.7% 16.4% 19.3% 58.4% 170 123 145 438$
BritishVirginIslands 967$ 0.4% 14.2% 3.4% 18.1% 4 138 33 175$
Aruba 2,347$ 0.0% 13.8% 6.3% 20.1% ‐ 323 149 472$
U.S.VirginIslands 3,104$ 13.3% 13.6% 5.5% 32.4% 414 422 170 1,005$
SaintLucia 699$ 1.6% 12.1% 35.4% 49.1% 11 85 247 343$
Barbados 2,538$ 0.1% 11.0% 16.6% 27.7% 1 280 422 704$
NetherlandsAntilles 2,705$ 12.6% 11.0% 12.5% 36.0% 341 296 338 975$
Bahamas 5,786$ 12.9% 10.8% 7.9% 31.7% 748 627 458 1,833$
SaintVincent&theGrenadines 371$ 0.0% 9.5% 37.7% 47.2% ‐ 35 140 175$
SaintKitts&Nevis 359$ 60.5% 8.5% 20.3% 89.3% 217 31 73 321$
Montserrat 34$ 20.2% 8.0% 21.3% 49.5% 7 3 7 17$
Grenada 391$ 63.0% 7.8% 40.7% 111.5% 247 31 159 436$
Jamaica 8,773$ 3.3% 6.8% 46.8% 56.9% 292 593 4,106 4,991$
CaymanIslands 2,204$ 43.7% 6.3% 3.5% 53.4% 963 138 76 1,178$
DominicanRepublic 20,519$ 4.0% 5.6% 30.8% 40.3% 814 1,144 6,318 8,276$
Dominica 249$ 28.8% 5.0% 43.5% 77.3% 72 12 108 193$
Cuba 38,065$ 5.8% 2.0% 19.1% 26.8% 2,197 761 7,256 10,214$
PuertoRico 86,726$ 1.2% 1.1% 3.7% 6.0% 1,055 970 3,202 5,227$
Trinidad&Tobago 12,610$ 0.0% 1.0% 15.0% 16.0% 0 127 1,892 2,020$
Haiti 4,378$ 2.4% 0.8% 120.0% 123.2% 107
36 5,252 5,394$
Martinique 9,896$ 1.4% 0.7% 6.0% 8.1% 137 67 596 800$
Guadeloupe 8,623$ 1.2% 0.6% 7.7% 9.5% 101 52 667 820$
‐$
TOTALCARIBBEAN 212,397$ 3.7% 3.0% 15.0% 21.7% 7,899$ 6,418$ 31,876$ 46,193$
%ofGDP $Million
“For just these four categories — loss of tourism revenue, increased
hurricane damages, at-risk residential real estate, and increased
electricity costs — the annual costs of inaction are projected to total $92
billion by 2050 and $345 billion by 2100, figures that respectively would
constitute 2.8 percent and 5.0 percent of the state’s projected Gross
State Product “ - Stanton and Ackerman, November 2007
For the United States the cost of climate inaction in four cost
categories – increased hurricane damages, residential real
estate losses due to sea level rise, increased energy costs,
and water supply costs – will add up to $1.6 trillion (in today’s
dollars), more 1.5 percent, of U.S. output per year by 2100.
-Ackerman and Stanton, May 2008
Costs of Inaction: Florida, USA
Cost of Inaction in Perspective
Costs of Inaction *
2050 2100
Percent of United States GDP 1.20% 1.55%
Percent of Florida GSP 2.8% 5.0%
Percent of Caribbean GDP ** 10.3% 21.7%
* Not an exact accounting of similar categories of losses and damages
** Based partly on a different methodology
Leading the Way
Good costs: innovation, efficiency and growth
Good costs: innovation, efficiency and growth
Avoid damages
Avoid damages and
and enable development
enable development
Climate action is
Climate action is life insurance for the planet!
life insurance for the planet!
Stockholm Environment Institute
• Independent international research organization working on sustainable
development.
• HQ in Stockholm, Sweden with centers in the US, UK, Estonia, and
Thailand.
• Applied scientific research: bringing science to policy makers.
• 170 staff (25 in the U.S.).
• Funders: Swedish and US Governments, UNDP, UNEP, UNFCCC,
foundations, national & local governments and NGOs
• US Center of SEI is an independent non-profit research institute affiliated
with Tufts University in Massachusetts.
• Web sites: www.sei-us.org and www.sei.se