The world is facing a stark reality: the current level of investment in infrastructure is insufficient to withstand the escalating impacts of climate change. This is the stark warning issued by the Organization for Economic Co-operation and Development (OECD) in a new report titled "Infrastructure for a Climate-Resilient Future."
The report highlights the growing pressure extreme weather events are placing on critical infrastructure systems. Record-breaking temperatures witnessed in 2023, with global averages exceeding 1.4 degrees Celsius above pre-industrial levels, resulted in a surge of floods, heatwaves, wildfires, and droughts. These events have exposed vulnerabilities in transportation networks, communication grids, energy systems, water supplies, and waste management facilities, particularly in developing countries.
The economic toll of climate change on infrastructure is significant. The OECD report cites a sevenfold increase in disaster-related economic losses between the 1970s and the 2010s, rising from an average of USD 198 billion per year to a staggering USD 1.6 trillion. This alarming trend underscores the urgent need for a paradigm shift in infrastructure investment strategies.
The report proposes a course correction – a substantial increase in annual investment towards building sustainable and climate-resilient infrastructure. The estimated annual investment required to achieve this goal by 2030 is a significant USD 6.9 trillion. This figure aligns with commitments outlined in the Paris Agreement and the UN's Sustainable Development Goals.
Investing in climate-resilient infrastructure presents a compelling economic case. The report emphasizes that such investments are not merely an expense, but rather a strategic cost-saving measure. Upgrading infrastructure to withstand future climate threats will ultimately prevent costly repairs and disruptions in the long run. Moreover, resilient infrastructure can bolster economic growth and stability by safeguarding vital services and ensuring their continued operation during extreme weather events.
The OECD report emphasizes the crucial role of regional and local governments in building climate resilience. These entities are often at the forefront of managing infrastructure assets and are well-positioned to implement adaptation strategies. The report calls for improved funding mechanisms and innovative approaches to mobilize climate finance at the subnational level.
The path towards a climate-resilient future requires a collective effort. The OECD report serves as a clarion call for governments, international organizations, the private sector, and civil society to work together in closing the infrastructure investment gap. By prioritizing sustainable and resilient infrastructure, we can safeguard communities, economies, and the environment from the intensifying impacts of climate change.