Map shows how climate change will hit the economies of the world’s poorest countries hardest
Credit rating agency Moody’s issues guide to how climate change will affect states’ ability to repay their debts
Ian Johnston Environment Corrrespondent
A map showing the countries which are most susceptible to the effects of climate change on their ability to repay sovereign debt Moody’s
Global credit rating agency Moody’s has drawn up a map of the countries most at risk of defaulting on their debts because of climate change, showing that some of the poorest parts of the world are expected to be hardest hit.
And, in a warning to oil-producing states, it said they would face “an additional set of economic, fiscal and institutional credit challenges” as the world moves to a low-carbon economy.
The list of the “most susceptible” nations included the likes of India, Pakistan, Vietnam, Papua New Guinea, Ethiopia, Kenya, Angola, Namibia, Bolivia and Honduras, according to a report by Moody’s.
In contrast, most of Europe, North America and China were among those considered least at risk.
The report’s conclusions fit with the general trend that poor countries which have done the least to cause global warming will suffer its effects the most and the nations that built their wealth on fossil fuels will fare better.
“While all countries will experience the physical effects of climate change to some degree, sovereigns [countries] with larger, more diversified economies and geographies are less susceptible,” Moody’s said.
“These economies generally have better infrastructure quality that can withstand disruptive events and an ability to carry a higher debt burden at more affordable interest rates.
“In contrast, those with a greater reliance on agriculture, lower incomes, weaker infrastructure quality, and smaller fiscal capacity exhibit greater susceptibility.”
It cited four main reasons why climate change could affect “a sovereign’s ability and willingness to repay its debt”.
There were the potential economic impact, for example as a result of lost agricultural production; damage to infrastructure cause by floods and storms; rising social costs resulting from health or food crises; and “population shifts due to forced displacements resulting from climate change”.
But it warned the latter problem may have already helped push at least one country into war.
As we can see, Bolivia is in this hemisphere the most susceptible to suffer … $150 billion dollars were wasted by this government and we have done NOTHING to tackle this … the coca grower caudillo and his acolytes must leave office as soon as their mandate is over.
We desperately need to rebuild our nation and repair this lost decade … the petty populism of the 21st century has done nothing but damage to Bolivia!