Swiss Re warns climate change could torpedo global economy 

The Paris Agreement is a legally binding international treaty on climate change adopted in December 2015. Keystone / Fazry Ismail

Climate change is the greatest long-term threat to the global economy, according to a study by insurer Swiss Re. Without measures to reduce greenhouse gas emissions, temperatures are likely to rise by more than 3°C in the next 30 years and global gross domestic product could fall by 18%. 

Asia would see the greatest economic decline, with China suffering a 24% drop, the reinsurance company said in research published on Thursday. The United States would lose nearly 10% and Europe nearly 11%, with Switzerland less exposed than other countries (-6%). 

Swiss Re’s experts examined four scenarios, with global warming by 2050 increasing by less than 2°C to more than 3.2°C. The impact on 48 countries was assumed: economic output would decrease by 18% globally if no measures were taken. 

Complying with the Paris Agreement targets would limit the contraction to 4%, they said. 

“Climate change is a systemic risk,” concluded Swiss Re chief Jérôme Haegeli, quoted in the study. In his view, “too little has been done so far” to deal with it. 

Switzerland has ratified the Paris Agreement and committed to reducing its greenhouse gas emissions by 50% compared with 1990 levels by 2030.