CLIMATE LOSS AND DAMAGE IN AFRICA: MASSIVE COSTS ON THE HORIZON
Sven Harmeling, CARE, with contributions from Alpha Kaloga and Fanny Petitbon
Behind the worst climate change impacts, there is a human, often non-economic dimension which cannot just be expressed in economic terms. If for example communities in Mozambique lose members after a terrible cyclone or poor families in the Horn of Africa lose livelihood assets from droughts or floods. Whether it is farm animals, or harvests, this not only results in economic losses but may bear psychological impacts, may adversely impact the health conditions of children for years, or even lead to girls not being able to attend schools, because they might be required to work in the households to make good for lost assets. Therefore, it is critical to better understand the potential costs of climate change in terms of losses and damages, not only in the short but also the longer term, to inform global debates on mechanisms for financial support and compensation, but also to assist governments and communities in planning for their future. In light of COP27, we looked into available knowledge on the losses and damages that Africa is confronted with. Obviously, assessing today’s losses and damages associated with the adverse impacts of climate change today is complex, even more so when we look into future projections. It includes climate factors as well as non-climate factors (such as the value of infrastructure, livelihood assets etc. which may get lost or damaged).
Current impact events: economic damages, lost assets, people displaced
In January and February 2022, Madagascar, Mozambique, Malawi and neighbouring countries suffered severe floods after a series of tropical storms hit the region, including three cyclones such as Ana and Batsirai. Attribution scientists found that the first cyclone, Ana, came with an increase in the likelihood and intensity of heavy rainfall with greenhouse gas and aerosol emissions in part responsible for the observed increases. “as Friederike Otto, a prominent climate attribution scientist explained. When extreme weather events occur, in particular when they have serious humanitarian implications, loss and damage assessments are rapidly available, based on data collected by governments, civil society organisations, international agencies etc. This is the data which CARE also uses to plan responses in working with affected communities, including, when cyclone Gombe hit Mozambique in March 2022 and affected more than 100,000 people. With regards to infrastructure, in the few days after, it was already clear that more than 11,000 houses were reportedly destroyed (without the economic costs assessed), with almost the same number being partially destroyed. The cyclone also damaged 346 classrooms in 113 schools affecting the provision of education for 14,775 pupils. Sixteen health posts had also been affected by heavy rains and winds. Rebuilding these would be a logical response to address loss and damage, but it comes with costs which often poor communities and countries cannot shoulder easily, or only at the expense of other important investments into education, health, economic activity etc..
In 2020, Ethiopia experienced severe floods. During the Kiremt rainy season from June through September, local communities observed an increase of between 150-400 % more rain than usual in mid-August and September. Almost 300,000 people were displaced, damages amounted to an estimated 135 million USD, according to research by Kassegn and Endris. However, this was followed by a prolonged drought due to four consecutive failed rainy seasons since late 2020, which continues to push an increasing number of people to the brink of famine. The drought negatively impacts the lives and livelihoods of vulnerable communities in the southern and eastern parts of the country across Oromia, Somali, Afar, Sidama and Southwest. By September 2022, OCHA records found that close to 17 million drought-affected people nationwide required multi-sector lifesaving assistance (such as water and sanitation, food distribution, shelter) for the rest of the year. Over 3.5 million livestock are estimated to have died and 25 million livestock are weakened and emaciated. This comes with direct health, psychological and economic costs to the people where for many these are critical livelihood assets. Providing new livestock to those who experienced such losses would be a logical way to address those losses, but not only does it come with costs, but also should undergo a check of future climate proofing: is it a livelihood solution that can still work?
A report recently released by the V20/Climate Vulnerable Forum assessed the economic losses attributed to climate change impacts in the last two decades (2000-2019). All of the African countries considered therefore have experienced significant reductions of the per capita GDP due to climate change, with Liberia, Sudan, Tunisia, Eswatini, Ethiopia, DR Congo in the order of or above 5%. South Sudan tops the list with losses of over 15%.
Carbon Brief’s analysis of disaster records finds that extreme weather events in Africa have killed at least 4,000 people and affected a further 19 million since the start of 2022. However, the impacts of African extreme events often go unrecorded – especially for heatwaves – and so the true figures are likely to be much higher. It is difficult to assess the impact and incidence of loss and damage in Africa, as Carbon Brief found, while the US hurricane season and 40°C heat in the UK have captured headlines, many of Africa’s most extreme and life-changing weather events went largely unreported in global-north media. This lack of attention has also been addressed in a series of reports that CARE released in the last years in the “most under-reported humanitarian crises”. The latest 2021 edition again demonstrates not only how many of these crises in Africa involve a climate dimension, but also that African countries frequently feature high up in the ranks of under-reporting. It is hence very likely that the current estimate of the cost and economic incidence of loss and damage is underestimated, due to the lack of data and absence of mechanisms to systematically record the economic damages, lost assets, people displaced .
Due to its high rates of poverty and limited capacity for adaptation, Africa is particularly vulnerable to these effects because it is home to 70% of the world’s Least Developed Countries. Even minor shocks, like minimal precipitation or high food costs, can lead to calls for humanitarian intervention and emergency action in many African countries.
Future loss and damage costs depend on mitigation and adaptation actions
Current and projected costs to address loss and damage are enormous, with some sources projecting economic costs in developing countries to be between 290 billion and 580 billion USD annually by 2030. Even if the adaptation is massively scaled-up and the immediate 100bn goal realized, Africa will still suffer large “residual” damages with the potential to double the adaptation costs.
One of the most advanced modelling-based assessments on loss and damage in Africa was the UNECA/ACPC report from 2014. While the results may look old, it generated useful results regarding the linkages between mitigation, adaptation and loss and damage costs. It found that in a 4°C world with weak adaptation and weak mitigation “residual damages” costs of up to 6% of Africa’s GDP could be incurred annually by 2080. Even with strong regional adaptation in a 4°C world this would still amount to a cost equivalent to 3% of Africa’s projected 2080 GDP annually. However, even at 2°C warming, the models projected more than twice as high residual damages (in % of GDP) even in scenarios with significant adaptation efforts.
The IPCC’s 6th Assessment Report (Africa chapter) concluded across nearly all African countries, GDP per capita is projected to be at least 5% higher by 2050 and 10–20% higher by 2100 if global warming is held to 1.5°C compared with 2°C (which in return means economic losses would be much higher at levels above 1.5°C warming).
The AfDB’s 2022 African Economic Outlook report on the needs of African Countries estimates finance needs for loss and damage in the period 2022-2030 at between USD 289.2 to USD 440.5 billion, which on average would be around USD 36 billion to USD 55 billion. The estimated adaptation finance needs are in a similar order of magnitude. Still, the report highlights a likely underestimation due to data gaps and challenges.
Under current climate policies, the Least Developed Countries (LDCs), the Small Island Developing Countries (SIDs) and those that are members of the Climate Vulnerable Forum (CVF), on average, can expect to see climate change reducing their GDP by 19.6% by 2050 and by 63.9% by 2100, as a report by Christian Aid found last year. In a 1.50C world, these nations will see GDP hit by 13.1% by 2050 and 33.1% by 2100. African countries will face the brunt of this economic harm with Sudan topping the list with an 83.9% GDP impact by 2100 under the current policies. The same study indicated that eight of the 10 most climate impacted countries are in Africa with two in South America. All ten face GDP damage of over 70% by 2100 under a current climate policy trajectory and a 40% hit even if the world keeps to 1.5ºC. Considering this modeling approach does not take into account the impact of extreme weather events, incorporation of these events could considerably increase losses and damages.
Loss and Damage projections in African NDCs: still mostly a blind spot
An analysis of the first round of NDCs found in 2017, that only around 14% of the African NDCs addressed loss and damage in one or the other way. Most of the current, 2021 and 2022 African NDCs provide a quantification of the estimated adaptation costs (sometimes including their expected support component, known as “conditional” contributions), but give little prominence to loss and damage. This low level of reference to loss and damage in NDCs could be explained by the fact that the assessment of climate-related risk is complex, with standard methodologies not yet in place, and by the absence of clear guidance on how to include L&D in the NDCs. This indicates that African States need more tools, capacity and knowledge generation to provide details and specificity about national loss and damage impacts and underlying initiatives including institutional arrangements at national level. However, several recent NDCs from some African countries also contain examples of projected loss and damages:
Egypt’s NDC refers to potential productivity losses of two major crops in Egypt – wheat and maize – which could be reduced by 15% and 19%, respectively, by 2050 due to frequent temperature increase, irrigation water deficit, and pests and plant disease. In addition, 12% to 15% of the most fertile arable land in the Nile Delta is expected to be negatively affected by sea level rise and salt water intrusion.
Guinea’s NDC references a WWF study which measures climate change costs through the potential loss of six ecosystem services due to climate change. In the case of Guinea, the total cost of climate inaction using this approach is estimated to be between USD 1.91 billion and USD 4.37 billion by 2050.
According to Tunisia’s NDC, some climate projections predict an increase in the frequency and intensity of prolonged drought episodes affecting in particular cereal production. It estimates that these could fall by almost 40% by 2050 according to the RCP 8.5 scenario.
The NDC of the Union of the Comoros references a vulnerability study from 2018 which estimated that without ambitious measures, the cost of climate-related impacts could be in the order of US$836 million by 2050, or an average annual cost over the period of US$23 million, which as a proportion of GDP in 2019 would be 1.9%.
The absence of more consolidated loss and damage estimates in the NDCs for 2030 is a major gap for countries to plan their responses to the climate crisis. Proposals for a loss and damage gap report, or an IPCC special report on loss and damage, as proposed by the Climate Vulnerable Forum in its recent Accra-Kinshasa Communique, gain attention against this background.
Despite uncertainties, the pursuit of new and additional finance for loss and damage must start now
There are still a lot of uncertainties about the scale of the loss and damage costs in Africa. However, there is no doubt that the scale will be massive and that this will significantly hamper the countries’ possibilities not only to pursue sustainable development goals, but also to invest into the necessary adaptation and resilience as well as mitigation measures.
African countries are at risk of climate catastrophes, often in times of emergencies the most vulnerable people are the one who pay for the social protection of their relatives and often rapidly before government support. On the other hand, countries are forced to take loans at commercial rates to deal with losses and damages, as resources provided through international support are by far not satisfying even the lower range of costs related to loss and damage. This situation leaves African countries trapped in a deep debt climate cycle where they have to borrow to rebuild and recover, until the next extreme thwarts their efforts and forces them to borrow again, causing them to fall back on debt. It will be important to provide substantial new and additional finance to address loss and damage (alongside greater adaptation finance) to assist Africa in dealing with the costs. This is a matter of justice given Africa’s overall small contributions to greenhouse gas emissions. Proposals for innovative funding sources such as those listed by the UN Special Rapporteur on Climate Change and Human Rights (e.g. international aviation tax, fossil fuel extraction levy etc.) could generate dozens of billions of USD as new and additional resources, and should be pursued more stringently. A UNFCCC mandate Loss and Damage Finance Facility, as also proposed by developing countries and many civil society organisations, could become the nucleus of channeling such finance to Africa (and other regions), making use, as appropriate, of existing African institutional arrangements. Ahead of COP27, several developed countries including the USA and the European Union have announced their willingness to explore loss and damage funding arrangements, which confirms the welcome change of tone we observed since COP26. However, we will remain vigilant regarding the type of solutions put forward by developed countries: humanitarian aid, early warning systems and insurance mechanisms are not a silver bullet to respond to all losses and damages. CARE joins the call for the establishment of an ambitious loss and damage finance facility. as also CARE’s COP27 position demands.