25% GDP Decline by 2100 Without Drastic Climate Action - RBA
(29 June 2020 – Australia) The Reserve Bank of Australia (RBA) has endorsed a stern warning that without drastically more ambitious international climate policies, in the next 80 years the disruption under the trajectory of climate change will cause global GDP to collapse by 25 percent.
The RBA threw its weight behind 66 central bank counterparts including the Bank of Japan (BoJ), Bank of England (BoE) and People’s Bank of China (PBoC). Global reserve banks are growing increasingly concerned at the financial crisis which will result from global warming of 3°C or more without significant steps to avoid the most severe physical and economic climate change impacts. The report found that achieving global net zero emissions by 2050 through early and ambitious action would give a greater than 67 percent chance of limiting global warming to sub 2°C and capping the global hit to GDP at four percent by the end of the century. The network report follows a record heatwave in Siberia (one of the coldest places on earth) with the region's exceptionally warm year to date contributing to permafrost melt and kicking off the wildfire season early.
"Climate change leads to financial risks and therefore remains a vital issue for central banks and supervisors to address," said Network of Central Banks and Supervisors for Greening the Financial System Director and Netherlands Central Bank Executive, Frank Elderson.
"Settling on an economy wide target will let us then decide the best ways to get there and what policy mechanisms could be applied. Our members have long accepted the science of climate change and the need to decarbonise the economy. In that regard we have consistently argued for well designed, market based and stable national policy settings around which our members can invest” said Australian Energy Council CEO Sarah McNamara.