Now, a new report suggests that by 2100 global warming of 2.5°C, is likely to risk 1.8%, of the world’s financial assets which amount to a whopping $2.5 trillion.
By the year 2100, the mean surface temperature is likely to be increased by 2.5°C above the pre-industrial levels.
The report was published, by researchers at the Environment at the London School of Economics and Political Science and Vivid Economics and the Grantham Research Institute on Climate Change in the journal Nature Climate Change.
However, the report also stated that there was also a one percent chance that 16.9 percent ($24 trillion) global assets could be at risk by a warming of 2.5°C due to the "uncertainties" in estimating "climate Value at Risk."
Climate Change can affect the value of financial assets via extreme weather events and labour productivity and wage reduction.
As per Alex Bowen who is the principal research fellow at the Grantham Research Institute on Climate Change and the Environment, "A good example of how climate change can affect capital through extreme weather events is through the destruction of buildings and structures in storms."
He also added that due to temperatures more/less than the average range, human productivity is also adversely affected. At the same time, agricultural produce also suffers a setback due to fluctuating temperatures.
Image Credit: dcgazette.com; Source: cnbc.com