Extreme weather cost global economy $2 trillion in past decade

Extreme weather events linked to climate change have cost the global economy over $2 trillion from 2014 to 2023, with the United States bearing the highest financial burden, according to a report by consultancy Oxera for the International Chamber of Commerce (ICC).

The report, released as COP29 kicks off in Azerbaijan, found that losses from climate-related disasters are comparable to the 2008 global financial crisis.

ICC Secretary-General John Denton emphasized the urgency, stating, “the economic impact of climate change” demands “a response of similar speed and decisiveness.”

The report analyzed nearly 4,000 events affecting 1.6 billion people, revealing that in the last two years alone, damages totaled $451 billion—a 19% increase from the previous eight years.

The U.S. recorded the highest cumulative losses, amounting to $934.7 billion, followed by China at $267.9 billion and India at $112 billion.

Per capita, the French territory of Saint Martin experienced the highest cost, with an average impact of $158,886 per person.

U.S. territory Puerto Rico, still grappling with the aftermath of Hurricane Maria in 2017, ranked fifth in per capita damages. While the report categorized Puerto Rico separately from the U.S. in its analysis, it acknowledged Puerto Rico’s status as a U.S. territory.

The report also highlighted how single extreme events can have devastating effects on developing nations, with costs sometimes exceeding a country’s annual GDP. Denton underscored the significance of immediate action at COP29, urging leaders to prioritize a finance package to aid low-carbon and climate-resilient development.

“The UN Climate Change Conference in Baku cannot be—a ‘transitional’ COP,” Denton stressed, calling for “outcomes capable of accelerating climate action commensurate with the immediate economic risks.”

Ilan Noy, a disaster economist at Victoria University of Wellington, who was not involved in the ICC study, told The Guardian that the findings align with his own research but cautioned, “These numbers actually miss the impact where it truly matters, in poor communities and in vulnerable countries.”