LatinNews Daily - 24 May 2023

* The World Bank (WB) has released a new country climate change and development report (CCDR) warning of the impact of climate change on Honduras, which historically has been highly exposed to extreme natural hazards. The WB report says that “based on historical growth and natural hazard risk patterns, in the absence of any further climate or policy changes, the combined impact of productive capital destroyed through excess rain (flooding), tropical cyclones (strong winds), and earthquakes is expected to result in a cumulative loss of around 5.4% of annual GDP by 2050 (relative to the hypothetical scenario without impacts caused by natural hazards)”. The WB points out that this would limit income opportunities, and therefore reduce the consumption of the population by 6.8%, adding that “lower growth, foregone revenue, and the diversion of productive resources toward reconstruction and relief efforts also limit the private sector’s profitability and stress the government’s fiscal capacity”. The WB cites projections that, by 2050, public debt levels will rise by around 6.2 percentage points of GDP, compared to a hypothetical scenario with no impacts from natural hazards. Honduras consistently ranks among the countries most vulnerable to natural hazards. In 2019, the Global Climate Risk Index, produced by Germany-based NGO Germanwatch, classified Honduras as the second country most severely affected by extreme weather events in the 1998–2017 period, with annual average losses equivalent to 1.8% of GDP affecting critical sectors such as transportation, telecommunications, health, education, water, and sanitation.