The Asian continent is vulnerable to huge climate risks unless it institutes effective adaptation and mitigation policies.
This is the view of McKinsey and company in its 2020 report titled Climate risk and response: Physical hazards and socioeconomic impacts.
The report characterizes risk within and across different countries and categorize impacts in four different types of countries in Asia: Frontier Asia, Emerging Asia, Advanced Asia, and China.
It links climate models with economic projections to examine micro cases that illustrate exposure to climate change extremes and proximity to physical thresholds.
A separate geospatial assessment examines six indicators to assess potential socioeconomic impact in 16 countries: Australia, Bangladesh, Cambodia, China, India, Indonesia, Japan, Laos, Malaysia, Myanmar, New Zealand, Pakistan, the Philippines, Thailand, Vietnam, and South Korea.
While establishing the overall risks of climate change in Asia, the report seeks to emphasize the path forward through adaptation and mitigation.
“Asia is well positioned to address these challenges and capture the opportunities that come from managing climate risk effectively. Infrastructure and urban areas are still being built out in many parts of Asia, which gives the region a chance to ensure that what goes up is more resilient and better able to withstand heightened risk. At the same time, key economies in the region, such as China and Japan, are leading the world in technologies, from electric vehicles to renewable energy, that are necessary to adapt to and mitigate climate change.”McKinsey report
It suggests that Asian governments and businesses must diagnose risk and enable quick response.
Protection of assets is counted as vital by reinforcing or elevating physical assets and infrastructure; building green defenses, such as restoring natural defenses and ecosystems; and building gray defenses that reduce the severity or duration of climate events, such as disaster relief community shelters.
The financing of adaption measures is particularly important because of Asia’s significant infrastructure needs.
To maintain growth momentum, eradicate poverty, and respond to climate change, the region must invest $1.7 trillion a year in infrastructure through 2030, according to the Asian Development Bank – about 2 percent ($40 billion per year) is expected to be applied to climate risk adaptation.