Photo: Economic impacts

Economic losses caused by natural catastrophes are likely to bring home the effects of climate change. (Credit: krunkwerke via Flickr.)

Climate change is expected to have a major impact on the world economy. For Canada — a country that depends so much on natural resources — the economic impacts could be severe. We're already seeing ominous changes:

• Rising ocean temperatures on Canada's West Coast have weakened economically valuable salmon species, reducing the survival rates of spawning fish, scientists say.

• Forests in British Columbia have been devastated recently by the mountain pine beetle, which thrives thanks to unusually mild winters. According to the BC Ministry of Forests and Range, as of 2012 the cumulative area of provincial Crown forest affected was about 181,000 square kilometres, an area of timber more than five-times the size of Vancouver Island. The value of these trees is in the billions of dollars.

• The 2001 prairie drought cost the Canadian economy over $5 billion in agricultural losses, according to a University of Manitoba study.

• The mining industry in Canada is also vulnerable to climate change, including from reduced water levels.

According to the Munich Reinsurance Corporation of Canada, "Economic losses caused by natural catastrophes are likely to bring home the effects of climate change more and more dramatically as time goes by."

The world's most in-depth analysis of the economic costs and opportunities of climate change is The Stern Review, a 700-page report released by former World Bank chief economist Lord Stern. The report concludes that early action to reduce the impacts of GHG emissions could cost only two per cent of GDP, but it warns that the costs of delaying action will result in significantly higher economic costs — up to 20% of GDP.

The world does not need to choose between averting climate change and promoting growth and development. In fact, the solutions to climate change will also bring about many economic benefits.

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