Extreme Climatic Events Cost 14% Of Global GDP: CDRI Report

Globally, around USD 732 billion to USD 845 billion lost on an average every year in infrastructure and buildings sector due to climate change and extreme disastrous events. This is equal to 14 percent of global gross domestic product (GDP) in the financial year 2021-2022.

This is according to the Coalition for Disaster Resilient Infrastructure (CDRI) Biennial Report on Global Infrastructure Resilience, released on Wednesday. The report highlighted the annual investment required to address the infrastructure deficit, achieve the Sustainable Development Goals (SDGs) and strengthen resilience by 2050, which would amount USD 9.2 trillion globally, in which USD 2.84- USD 2.90 trillion must be invested in lower and middle-income countries.

The Report presents a comprehensive economic, financial, and political perspective for investing in resilience infrastructure, based Global Infrastructure Risk Model and Resilience Index (GIRI). GIRI is the first publicly available and fully probabilistic risk model to estimate risk for infrastructure assets with respect to most major geological and climate-related hazards.

The report's key findings are obtained from the analysing last 10 years of infrastructure loss data, 8 organisations from 38 countries were involved in making the report. Approximately 30 per cent of the Average Annual Loss (AAL) is linked to geological hazards like earthquakes and tsunamis out of which around 80 per cent loss is concentrated in the power, transport, and telecommunications sectors. while 70 per cent of infrastructure loss is associated with climate-related hazards such as cyclones, floods, and storms.

Especially, Low and Middle-Income Countries (LMICs) experience a higher relative AAL, i.e ranging from 0.31 to 0.41 per cent compared to 0.14 per cent in high-income countries. 

The report also predicts in the upcoming years, high-income countries could see an 11 per cent rise in AAL due to climate change, while middle-income countries might experience increases by 12 per cent and low-income countries could face a staggering 33 per cent increase in AAL.

During the launch event, Kamal Kishore Member and HoD, NDMA and Co-Chair Executive Committee, CDRI said, " It is high time to move the discussion from risk to resilience. Investment in resilient infrastructure is not an expense but an investment to reduce the damage of property and loss of lives”.

He further added the report is a deep dive analysis to understand the importance of disaster infrastructure investment decisions and build Infrastructure systems that last long and serve generations to come.

Commenting on the significance of the Biennial Report, Amit Prothi, Director General, CDRI said, "The Report brings together a unique body of evidence to unpackage the 'Resilience Dividend" making a compelling economic, political, and financial case to radically upscale investment in infrastructure. It lays out the challenges which when addressed can become the pathways to resilient infrastructure."

The Coordinating Lead Author of the Report, Andrew Maskrey said, "Governments can use this Report to understand the risk they face and to realise that it is critical to ensure that all future infrastructure is fully resilient. The Report takes climate change into account and provides recommendations on strengthening resilience."

Amee Misra, Senior Economist and Head of Policy, UNDP India said, "With its comprehensive analysis of infrastructure resilience for every country, the Global Infrastructure Resilience Report is poised to inform the development of national resilience policies, strategies, and plans."