Sri Lanka economic losses from disasters total 0.2-pct of GDP a year: Study
ECONOMYNEXT- Sri Lanka has been hit by economic losses equivalent 0.2 percent of its gross domestic product over a 20-year period due to natural disasters, a new study done by British researchers said.
Titled ‘Climate Change and the Cost of Capital in Developing Countries’, the study was done by researchers at UK-based Imperial College Business School and SOAS University of London.
Commissioned by UN Environment, the study was conducted on data from 48 countries including Sri Lanka covering a 20-year period, in a grouping labeled Climate vulnerable Forum, which mostly has developing countries and small islands as members.
The researchers also studied some countries (Sri Lanka was not included) and concluded that natural disasters also pushed up interest costs and may have weakened credit ratings.
Meanwhile, a Sri Lanka-based think tank, the Institute of Policy Studies (IPS), has said that the cost of natural disasters on Sri Lanka’s economy amounted to 1 percent of GDP in 2017.
Extreme weather events have disrupted Sri Lanka’s economic activity over the past two years. A 2-year drought led to the agriculture sector growth falling 3.8 percent in 2016 and 0.8 percent in 2017.
Industrial activity was also disrupted in 2016 with factories hit by floods.
The report called for governments to invest more to improve resilience to weather related risks, and on social preparedness to such events.
The IPS had said that Sri Lanka’s 2018 budget included proposals to invest 39.1 billion rupees to improve Sri Lanka’s climate resilience. (COLOMBO, 17 July, 2018)