Many national economies will downgrade within a decade unless we reduce emissions.
Researchers used artificial intelligence to simulate economic effects of climate change on the creditworthiness for 108 countries over the next ten, thirty, fifty, and hundred years.
The study is the first to understand long-term climate change impacts on sovereign and corporate debt.
Climate change will eventually batter national economies. Markets need credible, accessible information on how climate change creates economic risk and how best to protect against it. The study's projections are extremely conservative as it tracks a straight temperature rise. Taking extreme weather events into account, economic downgrades and associated economic costs increase greatly. In fact, if unchecked, virtually all countries, rich or poor, hot or cold, will be downgraded by 2100.
We must adhere to the Paris Agreement. Stringent climate policy will significantly reduce impact on ratings.
Original article:
THE FIRST CLIMATE SMART SOVEREIGN CREDIT RATINGS
Original study:
Rising Temperatures, Falling Ratings: The Effect of Climate Change on Sovereign Creditworthiness