Conceptual framework for assessing indirect impacts of climate change
Introduction to the framework
The world is connected as never before. What happens in one country can have significant impacts on the lives and economy of people thousands of miles away, as demonstrated by the global spread of H5N1 ‘bird flu’ in 2006, the financial crisis of 2008 or the international impacts of the 2011 Japanese earthquake and tsunami.
Any strategic assessment of future change therefore needs to begin by recognising the level of interconnectedness between all places. This is as true for climate change as it is for economic policy or security and defence planning.
We argue that assessments of climate change impacts need to take account of global interdependencies. Strategies to adapt to climate change must consider the international dimension of climate risk and identify specific ways in which decision makers – and the systems which they represent – will be impacted by climate change in other countries.
However, currently the international dimension of climate risk is rarely considered in most countries’ climate impacts and adaptation assessments and there is currently no framework to assist adaptation decision makers to identify such impacts.
We therefore introduce a conceptual framework that can be used to identify these indirect impacts of climate change. By this we mean impacts that are observed or expected in one place, but brought about by climate change or extreme events somewhere else. We identify four international climate risk pathways, via which climate risks are transmitted across borders.
Climate change will directly impact ‘Receptor Systems’, such as sectors, markets or societies abroad, which will alter critical flows of goods, capital, people and resources via climate risk pathways, creating an ‘indirect climate change impact’ on decision makers in other countries.
The bio-physical pathway
The bio-physical pathway encompasses transboundary ecosystems, such as international river basins, oceans and the atmosphere. Adverse climate impacts on one part of a transboundary ecosystem can create impacts for all the countries that share the ecosystem’s services. For example, glacial melt and heavy rain upstream can create floods in downstream countries; droughts in the upper basin reduce water availability in delta cities; heatwave- and drought-induced forest fires in one country can disturb the air quality of countries far away down-wind; and so on. Furthermore, countries’ responses to climate change, for example by building new dams or diverting more water into irrigation, can have massive impacts on downstream countries via this pathway.
The trade pathway
The trade pathway transmits climate risks within regional and global markets and across international supply chains. For example, where severe drought decimates harvests in producer countries, the effects on commodity price are felt acutely by import-dependent countries thousands of miles away. Extreme weather events can disrupt production at manufacturing sites, causing ripple effects across just-in-time delivery systems for retailers half the world away. Countries’ response to climate impacts at home, for example the growing tendency of governments to use export restrictions during poor harvests, to protect food prices in domestic markets, can trigger price shocks and negative impacts in other faraway countries.
The finance pathway
The finance pathway represents the effect of climate impacts on the flow of capital, including the exposure of both publicly and privately held assets overseas that suffer lower yields or devaluation as the result of major disasters, or over time as climate change erodes the profitability and returns from various enterprises. Climate impacts will also affect private capital flows, for example when extreme weather renders migrant workers unemployed, stemming the flow of remittances ‘back home’.
The people pathway
The people pathway encapsulates the effect of climate change on the movement of people between countries, for example as a magnifier or driver of new migration patterns, or via the economic impacts of new tourism patterns or climate-sensitive human health risks that result from the movement of people across borders.
The framework also recognises the influence of climate change beyond a country’s borders on the global context in which all countries’ adaptation decisions are taken and implemented. Under various scenarios, climate change may alter or worsen the security situation in many regions, influencing the range of options – or the costs, benefits and rewards of specific adaptation measures, and the general scope for sustainable development. Over time, climate change may also be a factor in changing the general conditions of economic stability and structure and scope for regional and global governance, forcing individual countries to re-think their approach to adaptation at the national level.
Four different pathways and their impact on decision-making processes
By considering the range of indirect impacts that they will face via each of these pathways, countries will be better placed to develop effective and robust climate-compatible development strategies. A consideration of indirect impacts also opens up opportunities for regional and international collaboration to address shared climate risks.
Indirect impacts highlight the level of interdependence between countries – in adaptation as in all other aspects of economic, political and social life in the twenty first century. This realisation challenges us to rethink adaptation in a globalised world. It also serves as a reminder of why it is in all countries’ interest to ensure successful adaptation in other countries and to build global, systemic resilience to climate change.