Ending poverty on a livable planet requires all countries to enhance the resilience and adaptation of their people and economies to the impacts of climate change, while also reducing greenhouse gas (GHG) emissions and other damages to nature and the environment. To identify opportunities and priorities to align development and climate change action and objectives at the country level, the World Bank Group introduced the Country Climate and Development Reports (CCDRs) in 2022. This summary report, the third in the series, presents key findings from the first three years of CCDRs,covering 72 countries and economies. It complements the previous two summaries by focusing on the role of people, as they are affected by climate change impacts, but also as essential actors in inventing, designing, and implementing solutions to make development more resilient and to lower emissions.
People are at the center of climate change risks, but also at the core of adaptation and mitigation solutions. Climate change poses significant risks to people, causing long-term, irreversible, and intergenerational harm, especially for populations already affected by unemployment, exclusion or food insecurity. For instance, the expected loss of labor productivity in 2050 is around 6 percent in lower-income countries, but only 0.2 percent in high-incomecountries. Investing in people¡ªthrough education, reskilling, health, labor markets, social protection, and so on¡ªis crucial for building people¡¯s ability to adapt to climate change and contribute to and benefit from low-emission development. Placing people at the center of climate-development policies, as opposed to addressing their challenges through complementary policies, enhances policy effectiveness and can foster more inclusive growth.
Ensuring key infrastructure systems¡ªpower, water, transport, and digital¡ªare reliable, affordable, sustainable, and resilient is essential for people¡¯s resilience and well-being, but also for productivity and job creation. CCDRs highlight the potential benefits of enhanced access to electricity and improved maintenance, standards, investments and policies in the transport and water sectors, with benefit-cost ratio often larger than 2. They also highlight opportunities from expanding renewable energy, investing in public transit, and supporting transport electrification, and the growth of green value chains and digital technologies. Rapid urbanization provides a unique opportunity to develop resilient, low-emission cities that can drive growth; and the irreversibility of urban development makes action in this sector urgent.
Poorer countries are more vulnerable than richer ones, are exposed to different threats, and have lower adaptation potential. Each additional $1,000 in GDP per capita reduces expected climate change-induced GDP losses in 2050 by 0.5¨C0.7 percentage points, but some countries, especially small island countries, have characteristics that make them particularly vulnerable. Despite the potential of adaptation, some impacts cannot be prevented and reducing emissions remains a priority in all countries, especially in higher-income countries and other large emitters.
With well-designed policies, higher investments, and enhanced support from the international community, emissions reductions can be achieved with rates of economic growth that are similar to current trends. However, larger annual investments are required, with additional needs averaging 1.4 percent of GDP in CCDR countries but exceeding 5 percent in many low-income countries. Private investments can contribute more to these needs, and the toolkit of instruments available for mobilizing private capital toward climate investments has expanded over the years. But public finance will continue to play a crucial role, and enhanced domestic resource mobilization, increased spending efficiency, and more concessional resources for climate and development will be required.
The CCDRs are diagnostics that aim to help countries achieve their development and climate goals together. A companion report, , shows how the first CCDRs have been used either directly, through country national plans and strategies, through partners like the IMF and other development organizations, or through the World Bank Group country engagement framework and operational portfolio.
This review of three years of CCDRs demonstrates the benefits of applying a people lens to climate policy design. It shows that by placing people at the core of climate policy design from day one and increasing engagement with communities and stakeholders, countries can navigate a green transition that improves people¡¯s lives and promotes more inclusive economic growth.