In the coming years, many African countries are likely to experience more severe droughts and declines in water supply, which would further aggravate food shortages on the continent, Takatoshi Kato, deputy managing director of the International Monetary Fund (IMF), said on Thursday.
Climate change poses particularly serious macroeconomic, fiscal, and financial challenges for low-income countries, specially African countries, Kato said at the Fourth Tokyo International Conference on African Development, which was held on May 28-30 in Japan's southeastern port city of Yokohama.
These countries are more vulnerable to climate change because most of them are located in already hot tropical regions and are more heavily reliant on climate-sensitive sectors, such as agriculture, forestry, and tourism.
African countries also have a more limited capacity to adapt to climate change, given their lower income levels with 95 percent of population depend on agriculture for their livelihood and weaker institutional frameworks.
Because of the climate change, health and water systems of African countries may also come under increased stress in the coming decades from more intense and possibly more frequent natural disasters.
Kato warned that coasts may be flooded, and populations may seek to migrate, raising the risk of social conflicts.
According to some estimates, almost 1 billion people in Africa and Asia could experience shortages of water by 2080, more than 9 million could fall victim to coastal floods, and many could face increased hunger.
Among the potential problems with global warming, the risks to world agriculture and therefore food supply stand out as one of the most important.
Above a certain range of temperatures, warming tends to reduce yields. Recent estimates suggest the effects will be greater in countries located closer to the equator, with potentially large losses in Africa.
In some of the poorest countries, the damage could reach devastating levels of more than 50 percent of agricultural production.
The IMF official said that efforts by various countries to adapt to climate change must fit in with their broad development agendas.
He said economic and social development is one of the most powerful ways to increase the capacity to adapt to climate change. Rising income levels can create the fiscal space needed to meet additional demands on public spending, both on climate-related public goods (such as weather forecasting and sea defenses) and to protect programs affected by climate change.
Kato said increased financial and capacity-building assistance is needed to support adaptation to climate change, particularly in the least developed and most climate-exposed countries.
A World Bank study puts the costs of protecting existing investments from climate changes in developing countries at 10-40 billion U.S. dollars per year.
On the mitigation of climate change, the IMF official said, serious global efforts to reduce emissions of greenhouse gases that drive climate change could also have wide-ranging macroeconomic consequences.
He said reducing emissions of greenhouse gases requires putting a price on these emissions that reflects the global damage they cause. This would raise the costs of producing and consuming emission-intensive products.
The IMF's April 2008 World Economic Outlook examined the macroeconomic effects of mitigation policies, including on productivity, saving and investment, capital flows and exchange rates, illustrating some lessons for minimizing their costs.
It finds that policies should be credible and result in the appropriate pricing of emissions. He added that the policies should also avoid excessive volatility in those prices, and provide incentives for broad participation, without putting undue burden on countries least able to bear it.
The IMF official said the world body is committed to continuing to contribute to understanding and dealing with the macroeconomic, fiscal and financial challenges from climate change, including in Africa.
The IMF stands ready to provide financial assistance to member countries in response to a range of macroeconomic disturbances, including natural disasters, for example, through the exogenous shock facility that provides policy support and financial assistance to low-income countries, Kato said.
Source:Xinhua
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