Environmental risks make up the entire top five risks in order of likelihood for the first time, according to the latest WEF report.
Environmental risks make up the top five biggest risks facing the planet in 2020, according to the World Economic Forum’s latest Global Risk Report.
The annual report, which is in partnership with Zurich, has underlined the severe risk facing the globe as wildfires continue to rage in Australia and a wave of major natural disasters across the Asia-Pacific region last year.
For the first time, environmental risks make up the entire top five risks in order of likelihood. Extreme weather, climate action failure, natural disasters, biodiversity loss, and human-made environmental disasters comprise the list.
The World Economic Forum said this year’s list was published as “critical risks are manifesting”. Australian bushfires have caused billions in damage, destroyed the natural habitats of native species, and led to calls for increased awareness of climate change at the top level of government.
Environmental risks also dominated the top five global risks in terms of impact, according to the report. Climate action failure was ranked the top risk in terms of impact, followed by weapons of mass destruction. Biodiversity loss was cited as the third biggest risk, followed by extreme weather and water crises.
The report comes as world leaders descend on Davos for the WEF’s annual gathering. The Australian fires have pushed climate change to the top of the agenda, hardening public opinion
“Governments, markets and, in an increasing number of societies, voters are awakening to the urgent realities of climate change—it is striking harder and more rapidly than many expected,” the report said.
The report said the near-term consequences of climate change add up to a “planetary emergency”. “Implications are catastrophic, wide-ranging and intersecting. Worse still, the complexity of the climate system means that some impacts are still unknown,” the report added.
Stress on ecosystems, including stormier, warmer seas, was another major cause for concern, according to the WEF. Climate change will likely lead to lower crop yields, “undermining the ability to double food production by 2050 to meet rising food demand”.
Environmental risks will also lead to increased forced migration, according to the report. Rising sea levels will create “refugees” as “people flee low-lying areas”. “Defence and intelligence agencies are now regularly warning that climate change could trigger conflicts severe enough to uproot entire populations,” the report added.
Climate change also has the potential to exacerbate geopolitical tensions, the WEF said. Melting sea ice, for example, could open up new shipping routes, causing disputes between neighbouring countries over borders and boundaries. According to the report, water was a “major factor” in conflict in 45 countries in 2017.
Meanwhile, economic impacts and capital market risks were cited as another effect of climate change.
“Worldwide economic stress and damage from natural disasters in 2018 totalled US$165 billion, and 50% of that total was uninsured,” the report added
The WEF sounded a dire warning over the economic consequences of environmental risks.
“A report by federal agencies suggests that, in the United States alone, climate-related economic damage could reach 10% of gross domestic product by the end of the century. Over 200 of the world’s largest firms estimated that climate change would cost them a combined total of nearly US$1 trillion in the case of nonaction.”
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