Actuarial Study Projects 4 Billion Deaths At 3C Increase; Global Leaders "Blinded" By Lowball Estimates of Economic Loss [View all]

Global economic growth could plummet by 50% between 2070 and 2090 from the catastrophic shocks of climate change unless immediate action by political leaders is taken to decarbonise and restore nature, according to a new report.

The stark warning from risk management experts the Institute and Faculty of Actuaries (IFoA) hugely increases the estimate of risk to global economic wellbeing from climate change impacts such as fires, flooding, droughts, temperature rises and nature breakdown. In a report with scientists at the University of Exeter, published on Thursday, the IFoA, which uses maths and statistics to analyse financial risk for businesses and governments, called for accelerated action by political leaders to tackle the climate crisis.

Their report was published after data from the EU’s Copernicus Climate Change Service (C3S) showed climate breakdown drove the annual global temperature above the internationally agreed 1.5C target for the first time in 2024, supercharging extreme weather. Without urgent action to accelerate decarbonisation, remove carbon from the atmosphere and repair nature, the plausible worst-case hit to global economies would be 50% in the two decades before 2090, the IFoA report said. At 3C or more of heating by 2050, there could be more than 4 billion deaths, significant sociopolitical fragmentation worldwide, failure of states (with resulting rapid, enduring, and significant loss of capital), and extinction events.

Sandy Trust, the lead author of the report, said there was no realistic plan in place to avoid this scenario. He said economic predictions, which estimate that damages from global heating would be as low as 2% of global economic production for a 3C rise in global average surface temperature, were inaccurate and were blinding political leaders to the risks of their policies. The climate risk assessments being used by financial institutions, politicians and civil servants to assess the economic effects of global heating were wrong, the report said, because they ignored the expected severe effects of climate change such as tipping points, sea temperature rises, migration and conflict as a result of global heating. “[They] do not recognise there is a risk of ruin. They are precisely wrong, rather than being roughly right,” the report said.

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https://www.theguardian.com/environment/2025/jan/16/economic-growth-could-fall-50-over-20-years-from-climate-shocks-say-actuaries