(Paris) Regions of China and the United States of crucial importance for the world economy are the most exposed to the destructive effects of climate change, concludes an unprecedented study published on Monday, which analyzes the risks for buildings.
The company XDI, based in Australia and specialized in the assessment of climate risks on behalf of investors or financial analysts, has reviewed more than 2,600 territories around the world (American or Indian states, Chinese provinces, French regions, etc. ) to rank their vulnerability by 2050.
“We get a very strong signal on countries like China, the United States and India. These are basically the engines of the global economy, where a lot of infrastructure is concentrated,” summarized Karl Mallon, Director of Science and Innovation at XDI, during a presentation to journalists.
These three countries alone thus concentrate 80% of the 50 most at-risk territories, according to the ranking revealed by XDI. Of the top 10, nine are Chinese, starting with the provinces of Jiangsu, Shandong and Hebei in the east of the country.
The map of the world published by XDI is thus clearly colored in shades of red – a sign of risk – in China.
American states with significant economic importance also figure prominently in the ranking: Florida (10e), California (19e), Texas (20e)… Regions of India, Indonesia and even Brazil are also particularly threatened.
For Europe, the German Land of Lower Saxony is the most exposed territory (56e world rank). On a French scale, it is the Hauts-de-France region (121e rank).
“Capital Flight”
XDI’s methodology focuses on the risk to buildings posed by eight consequences of global warming: river and surface flooding, coastal flooding, extreme heat, forest fires, landslides (drought-related) , extreme winds and freeze-thaw.
The calculations are based on a pessimistic scenario by UN climate experts – the IPCC – of global warming of more than 3°C by the end of the century, with high emissions. It is generally used as the basis for risk assessment by banks, according to XDI.
“We are releasing this analysis in response to requests from investors for regional risk data,” said Rohan Hamden, XDI’s managing director.
“As built infrastructure typically overlaps with high levels of economic activity and capital value, it is imperative that the physical risk associated with climate change be better understood and assessed,” he argues.
The authors emphasize that this inventory should encourage countries to emit less CO2 to limit global warming and the catastrophes that accompany it.
But they point out that it will also have financial consequences – for example on the price of certain bonds – and on the behavior of economic players.
“People who want to set up a factory or a supply chain in these states and provinces will think twice about it,” predicts Karl Mallon. “We could have at best a risk premium in these territories and at worst a flight of capital from investors who seek safe havens”.