Climate change and the economic impact of extreme weather

From a climate change perspective, 2021 was another remarkable year. While not the warmest year on record, a host of extreme weather events and disasters – including extensive flooding in Germany, the Pacific Northwest, India, and China, as well as tornadoes in the American Midwest and Hurricane Ida striking the US South – impacted the global economy.

What you will learn:

• Losses from extreme weather events reached £360bn in 2021 (about 0.4% of world GDP).
• Typically, weather-related disasters have an impact on both demand and supply by damaging economic capital and interrupting supply chains and vital infrastructure.
• While the impact on supply chains requires an analysis of the geospatial location of risks, estimating the impact on demand remains more challenging and is typically resource intensive and highly uncertain.