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⬅ CARBS Business Review

Navigating the Storm: Climate Consequences and Its Impact on Economic Activities

Adeel Younis

Navigating the Storm Climate Consequences and Their Impact on Economic Activities

A total of Rs 615.07 billion (US$3.85 billion) is the economic cost of smoking in Pakistan, which is equivalent to 1.6% of the country’s gross domestic product. It is estimated that the economic cost of smoking was about five times more than the money generated by the tobacco industry in the year 2019.

As the temperature of the earth continues to increase, the consequences of climate change are no longer isolated to projections made in the distant future; rather, they are occurring right in front of our own eyes now. This multifaceted problem has a number of critical aspects, one of which is the influence it has on economic operations. We are going to go into the far-reaching repercussions of climate change and how they are transforming the landscape of economies all around the globe especially in Pakistan.

Because to climate change, there has been an increase in the number of severe weather occurrences, which is one of the most noticeable repercussions on economic operations. The frequency and severity of natural disasters such as hurricanes, wildfires, floods, and droughts are growing, which is causing supply chains to be disrupted and making sectors more susceptible to damage.

In a sector that is inextricably intertwined with climate, agriculture is facing difficulties that have never been seen before. Changing patterns of precipitation and severe temperatures have an impact on agricultural production, which in turn leads to disruptions in food supply and fluctuations in prices. Growing seasons are difficult to anticipate, which has a negative influence on farmers’ ability to make a living and poses a risk to the safety of food supplies throughout the world.

A rise in the frequency of severe weather events and rising sea levels pose a danger to the infrastructure and businesses that are located along the shore. Cities along the coast, which are centres of economic activity, are confronted with the combined task of adjusting to the effects of climate change while also preventing additional environmental deterioration.

What the Price of Inaction Is:

When calculating the economic costs of climate change, it is important to include not just the current harms, but also the long-term implications that would result from inactivity. Increased healthcare costs because of climate-related diseases, the loss of biodiversity that has an impact on sectors that are dependent on natural resources, and the economic toll of mass migrations that are caused by disruptions caused by climate all add to a gloomy economic future.

Additionally, the insurance industry is under pressure because of the increase in the number of claims that are associated with climate-related disasters. Consequently, this results in increased premiums, which have an effect not just on families but also on enterprises.

There are prospects in the green economy, even though climate change presents significant hazards. However, it also presents the possibility of new economic opportunities. Making the shift to an economy with lower carbon emissions is an essential step in limiting the effects of climate change. This transition also offers opportunities for innovation and the development of new jobs. Energy that is renewable, technology that are efficient with energy, and behaviors that are sustainable all provide opportunities for economic development while also addressing environmental problems.

In the process of economic planning, governments, and companies all around the globe are beginning to recognize the significance of sustainability. Furthermore, investments in clean energy, circular economies, and green infrastructure not only help to the preservation of the environment, but they also create economic resilience in the face of climate change.

The issue of climate change is a worldwide concern that calls for a coordinated solution. worldwide collaboration for a sustainable future is becoming more important. When it comes to the exchange of information, technology, and resources, international collaboration is very necessary in order to construct resilient economies. Countries that are still developing, which are often disproportionately impacted by the effects of climate change, need assistance from the international community in order to adapt and transition to more sustainable economic practices.

Climate change has a wide range of significant and diverse effects on the activities that take place in the economic sphere. It is vital that governments, corporations, and people acknowledge the connection of the economic and the environment as we navigate the storm of environmental concerns. This is because the environment and the economy are linked. The adoption of sustainable practices, the investment in resilience, and the promotion of global cooperation are not only moral imperatives, but also essential milestones in the process of ensuring a successful and sustainable future for everyone. Right now is the moment to take action, and the decisions we make now will determine the state of our economy in the future.

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Adeel Younis

Adeel Younis is a dedicated Ph.D. student with a distinguished academic background and a fervent commitment to the field of Management Sciences. Holding a master’s degree in management with a research focus on Supply Chain Risk Management from the esteemed University of Central Punjab, alongside a Master of Business Administration specializing in Human Resource Management from the University of Lahore.

Disclaimer

Please note that all opinions, views, statements, and facts conveyed in the article are solely those of the author and do not necessarily represent the official policy or position of Chaudhry Abdul Rehman Business School (CARBS). CARBS assumes no liability or responsibility for any errors or omissions in the content. When interpreting and applying the information provided in the article, readers are advised to use their own discretion and judgement.

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