Climate inaction may take large toll

Contrary to popular belief, sustainable transformation of the economy does not slow growth: decarbonization can boost the performance of Central and Eastern European countries (CEE) and helps mitigate the substantial losses of climate change – states the latest analysis of research firm Cambridge Econometrics. While the expected physical damages in CEE countries are close to the global average, the region can gain more from the sustainable transition than the global average.

Low-carbon policies offer the highest growth prospects for Hungary, Romania, and Slovakia in the CEE region, according to the key findings of a recent analysis by research consultancy Cambridge Econometrics. These countries can lose a growth opportunity on average worth up to 2.8 percent of their annual GDP by 2050 if they fail to decarbonize. Moreover, physical climate damages impacting their economy can reach 3.3 percent of their output if global mitigation efforts remain low.

Of the five countries under investigation, Poland and the Czech Republic will enjoy smaller but still positive impacts from decarbonization – however, these impacts get smaller towards the end of the modeled period. As the power sectors of these countries rely heavily on coal, decarbonization must happen faster than in other countries in the region. Towards the end of the modeled period, decarbonization investment will be lower for them as the power sector switches to renewables earlier.

(WBJ)