BAKU, Azerbaijan, September 10. Europe is facing the double jeopardy of climate change and energy insecurity, with farreaching economic and financial repercussions, Trend reports with reference to the International Monetary Fund (IMF).
The last IMF report reveals that the global average surface temperature has already increased by about 1.1 degrees °C compared with the preindustrial average, which amplifies the frequency and severity of climate shocks across the world.
“Within Europe, the Baltic Sea region is particularly vulnerable to global warming caused by climate change, with an annual warming trend twice as much as the global average. At the same, the explosion of geopolitical tensions has unsettled global energy markets. While it is still too early to know how events might unfold, the crisis will likely result in long-lasting changes in energy supply networks and energy sources in the generation of electricity. This is why addressing climate change and strengthening energy security are the two faces of the same coin. Policies and structural reforms aimed at reducing dependence on fossil fuels would deliver not only a significant reduction in CO2 emissions, but also help improve energy security throughout Europe,” say IMF analysts.
The report says European countries must mainstream adaptation into development plans to strengthen resilience against climate change.
“Long-term climate risks cannot be completely eliminated, and thus governments must take decisive action to strengthen physical, financial, institutional and social resilience. A variety of adaptation measures have been introduced to enhance resilience to climate change throughout Europe, but there are still significant gaps that keep some countries, such as the Baltics, more vulnerable to threats associated with climate change.
Enhancing structural resilience requires infrastructure and other ex-ante investments to limit the impact of disasters, while building financial resilience involves creating fiscal buffers and using prearranged financial instruments to protect fiscal sustainability and manage recovery costs. These measures will have upfront fiscal costs, but the lack of inaction on the climate front would have an even greater cost for generations. Furthermore, strengthening physical and financial resilience would reduce damages from climate change and increase expected returns to private investment and output.”
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