There is little evidence that low-latitude, poor countries will be greatly damaged by global warming if they adapt sensibly. Poor countries should strive to adapt to changes in climate on their own. They must not wait for international money from rich, industrial countries to do the magical work for them.

Climate funds to poor countries / A prevalent view in the global warming community is that low-latitude, poor countries will bear the brunt of global warming and climate change. This view leads to the idea that rich countries should financially help poor countries to cope with that change by financing the poor countries’ adoption of low- or zero-carbon technologies and other adaptations.

This view has created a perennial divide in the global negotiations between rich and poor countries, most visibly so since the United States declared at the Copenhagen Conference in 2009—the first year of Barack Obama’s presidency—that it will provide over $100 billion per year to assist poor countries in adapting to climate change. The U.S. financial commitment was interpreted as a political maneuver to avoid a new global climate “protocol” at that time that would be legally binding and apply to all countries without exception, described as “cutting the legs out” from under the messy United Nations framework on climate change.

After the Copenhagen meeting, global negotiations have deteriorated into a political deadlock between rich countries and poor countries with regards to when, how, how much, by whom, and where such funds should be delivered to the poor countries. Low-latitude, developing countries cannot afford to legally commit to any cut in greenhouse gas emissions, but they are still adamantly calling for financial assistance clauses to be explicitly written into a global agreement on climate change that is legally binding according to international laws as a pre-condition for the poor countries’ participation in the treaty process.

Developed countries, on the other hand, have been sluggish and reluctant to make pledges to fund the international climate adaptation finance program known as the Green Climate Fund (GCF). By the end of July 2015, pledged and signed contributions amounted to $5.8 billion for the four-year initial period through 2020, which amounts to approximately $1.45 billion per year. There is no information available on how much money the GCF has actually received.

Devastation in poor countries? / The predominant perception that low-latitude, poor countries will be devastated by global warming is grounded on fragile assumptions.

First, it is assumed that agriculture will be the most vulnerable sector if the climate were to warm up, accounting for one-third of the total market and non-market damages that arise from global warming, even in the United States. (See readings below.) Yields of major grains in the United States, such as corn and wheat, are predicted to suffer large losses if temperature increases.

Because agriculture is the most economically important sector in low-latitude, poor countries, employing more than 67 percent of the workforce in most African, South American, and South Asian countries, scientists reason that those countries are highly vulnerable to the effects of climate change. Scientists argue that the agricultural damage in those regions, relative to the current agricultural production or net income, will be at least twice as large as what is predicted in temperate developed countries like the United States.

In addition, low-latitude, poor countries are thought to lack the capabilities and capacities to adapt to climate change in the agricultural sector as well as in sectors besides agriculture; e.g., sectors affected by hurricanes, sea level rise, heat waves, monsoon rainfall, and diseases. As with agriculture, the damages in these sectors are routinely predicted to be more severe in the poor, low-latitude countries.

Perspectives on adaptation / Yet, let’s step back for a moment and reconsider each of the above statements from the perspectives of adaptation motives, strategies, and capacities commonly found in the poor countries and the industrial countries.

The claim that U.S. agriculture will be severely harmed because of climatic changes is not sound if adaptation possibilities by farmers are carefully taken into account. Many of the past studies of climate change and agriculture concentrated on the economic effects on only a single crop or a few major crops. But U.S. farmers can transition from one portfolio of crops to another crop portfolio or to another system of agricultural and natural resource management—an adaptation strategy that cannot be accommodated in such studies.

Likewise, the notion that poor, low-latitude countries are condemned to far greater losses from climate change because their economies are heavily dependent on agriculture cannot be validated empirically. Low-latitude, tropical countries pride themselves on having a rich array of natural resources and ecological diversity because of the unique climatic characteristics found only there. Just look at the Amazon, the island of Sri Lanka, and the Congo River Basin. When the great diversity of natural and biological resources is taken into account, empirical studies suggest that global warming will create only minor damages if individuals and communities adapt sensibly in tandem with changes in ecosystems and ecological systems.

The argument that low-latitude, developing countries will be affected more adversely because of a lack of adaptation capacities and technologies is pervasive in the literature. That idea, however, needs to be qualified. A study of hurricane fatalities in Oceania indicates that the hurricane fatality rate has fallen sharply over the past five decades because of an increase in income in this historically remote and poor region. The growth of income has increased adaptation capacities in the region such as satellite observations, early warning systems, evacuation orders, global information-sharing networks, and hurricane path projection technologies. In Oceania, of all the hurricanes that made landfall, the hurricane fatality rate fell from 1.6 deaths per hurricane in the 1970s to 0.3 deaths per hurricane in the 2000s. Most hurricanes did not cause any deaths.

In India, Bangladesh, and Sri Lanka, where a single hurricane tends to kill more than a thousand people, hurricane fatality rates have fallen sharply over the past three decades as a result of income growth and increased adaptation capacities. In India and neighboring countries, homes and other buildings have been made more resilient and shelters and bunkers along the vulnerable zones have become more common. Accordingly, hurricane fatalities fell from 2,441 persons per hurricane in the 1990s to 1,469 persons per hurricane in the 2000s, among the hurricanes that caused at least one fatality.

When it comes to the global warming that will unfold throughout this century, history suggests an encouraging future for low-latitude, poor countries. As their economies grow and their technological capacities increase, people and communities will find themselves more capable of withstanding natural disasters and climatic shifts. In low-latitude, developing countries, adapting to changes in climate optimally over a century-long time horizon will make them far more resilient and much less vulnerable than they are today.

Real help / Low-latitude, developing countries must not wait for the free money to flow from rich countries in order to prepare for climate change. They must realize that they should adapt on their own to the looming changes and should strive, based on that realization, to figure out and plan accordingly for the best ways their people and communities can adapt.

International aid often hurts the economic development of a recipient country if it works in a manner that weakens the country’s people and the foundations of its institutions and markets. In the case of global warming funds, this pattern will prevail. The “free” climate change money will fall into the wrong hands and encourage mal-adaptations and no-adaptations, wreaking havoc on the economies and livelihoods in the climate-shifting world of the future. This is the real threat to low-latitude, poor countries.

Readings

  • “Adapting Sensibly When Global Warming Turns the Field Brown or Blue: A Comment on the 2014 IPCC Report,” by S. N. Seo. Economic Affairs, Vol. 34 (2014).
  • “An Essay on the Impact of Climate Change on U.S. Agriculture: Weather Fluctuations, Climatic Shifts, and Adaptation Strategies,” by S. N. Seo. Climate Change, Vol. 121, No. 2 (2013).
  • Climate Change: The IPCC Scientific Assessment, published by the Intergovernmental Panel on Climate Change. Cambridge University Press, 1990.
  • “Did Adaptation Strategies Work? High Fatalities from Tropical Cyclones in the North Indian Ocean and Global Warming,” by S. N. Seo and L. Bakkensen. Submitted to Natural Hazards, 2015.
  • “Estimating Tropical Cyclone Damages under Climate Change in the Southern Hemisphere Using Reported Damages,” by S. N. Seo. Environmental and Resource Economics, Vol. 58 (2014).
  • “Fatalities of Neglect: Adapt to More Intense Hurricanes?” by S. N. Seo. International Journal of Climatology, Vol. 35 (2015).
  • “Global Climate Change and U.S. Agriculture,” by R. Adams, C. Rosenzweig, R. M. Peart, et al. Nature, Vol. 345 (1990).
  • “Integrated Model Shows that Atmospheric Brown Clouds and Greenhouse Gases Have Reduced Rice Harvests in India,” by M. Auffhammer, V. Ramaathan, and J. R. Vincent. Proceedings of the National Academy of Sciences, Vol. 103 (2006).
  • Micro-Behavioral Econometric Methods, by S. N. Seo. Elsevier, 2016.
  • Micro-Behavioral Economics of Global Warming: Modeling Adaptation Strategies in Agricultural and Natural Resource Enterprises, by S. N. Seo. Springer, 2015.
  • “Modeling Farmer Adaptations to Climate Change in South America: A Micro-Behavioral Econometric Perspective,” by S. N. Seo. Environmental and Ecological Statistics, 2015. DOI:10.1007/s10651-015‑0320‑0.
  • “Nonlinear Temperature Effects Indicate Severe Damages to Crop Yields under Climate Change,” by W. Schlenker and M. Roberts. Proceedings of the National Academy of Sciences, Vol. 106, No. 37 (2009).
  • “Potential Impact of Climate Change on World Food Supply,” by C. Rosenzweig and M. Parry. Nature, Vol. 367 (1994).
  • “The Distributional Impact of Climate Change on Rich and Poor Countries,” by R. Mendelsohn, A. Dinar, and L. Williams. Environmental Development Economics, Vol. 11(2006).
  • “The Economic and Food Security Implications of Climate Change in Mali,” by T. A. Butt, B. A. McCarl, J. Angerer, et al. Climatic Change, Vol. 68 (2005).
  • “The Economic Effects of Climate Change,” by R. Tol. Journal of Economic Perspectives, Vol. 23 (2009).
  • The Economics of Global Warming, by W. Cline. Institute of International Economics, 1992.
  • The Great Escape: Health, Wealth, and the Origins of Inequality, by A. Deaton. Princeton University Press, 2013.
  • “The Impact of Global Warming on Agriculture: A Ricardian Analysis,” by R. Mendelsohn, W. Nordhaus, and D. Shaw. American Economic Review, Vol. 84 (1994).
  • “The Social Costs of Climate Change: Greenhouse Damage and Benefits of Control,” by D. Pearce, et al. Intergovernmental Panel on Climate Change, Cambridge University Press, 1996.