Researchers: climate change could trigger economic boom for Arctic, disaster for poor countries

Though it might create new opportunities for mining and shipping in the Arctic, melting Arctic sea ice could spell global economic disaster, a group of researchers from the United Kingdom and the Netherlands said in an article in the journal Nature.

They found that the presence of 30 per cent of the world’s undiscovered natural gas reserves and 13 per cent of its oil could trigger a heavy flow of capital to the Arctic.

And with new trade routes opening up, Lloyd’s of London estimates that investment in the Arctic could reach $100 billion (USD) within 10 years,” the article said.

But that number pales in comparison with the hit that the global economy would sustain.

The scientists say that “methane gas from thawing permafrost beneath the East Siberian Sea” could cost the global economy $60 trillion because of climate change reactions like flooding of low-lying areas, storms and extreme weather conditions.

That’s almost equal to the value of the entire global economy in 2012 — $70 trillion

However, “the total cost of Arctic change will be much higher,” the article said.

They predict that $60 trillion of climate change impacts would flow from the release of 50 gigatonnes of methane between 2015 and 2025.

They believe this methane gas would speed up global warming, which, in turn, also speeds up the melting of important permafrost, like that of the Greenland ice sheet.

But that estimate could be a conservative one, as “unknown factors” such as sudden bursts of methane in the atmosphere could “trigger more rapid temperature changes than if the gas were released gradually,” the article reads.

Through scientific modeling, their studies show that poorer countries in Africa, Asia and South America would be hit the hardest by the extreme weather.

That means that poorer countries would have to bear the costs of increasingly extreme weather.

The three scientists — Gail Whiteman, professor at Erasmus University in Rotterdam, Chris Hope, a “reader in policy modeling” at the Judge Business School at the University of Cambridge, and Peter Wadhams, a professor of ocean physics at Cambridge — call for discussion about Arctic change in global economics.

The scientists want a worldwide economic model for climate change to be created to give “perspective on Arctic change.”

“Such integrated analyses of Arctic change must enter global economic discussions.

But neither the World Economic Forum (WEF) in its Global Risk Report nor the International Monetary Fund in its World Economic Outlook recognizes the potential economic threat from changes in the Arctic,” the article said.

They said avoiding methane gas releases in the East Siberian Sea “without major reductions in global emissions of Co2 will be difficult, and “perhaps impossible.”

One solution could be reducing black carbon deposits on snow and ice.