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The economic impact of climate change in Namibia: how climate change will affect the contribution of Namibia’s natural resources to its economy

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L. Sahlén
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Climate change is likely to exacerbate the dry conditions already experienced in Southern Africa; but these predictions gain little policy attention in Southern African countries. This paper discusses how Namibia must take steps to provide some economic indicators of how climate change will affect the country and ensure that all its policies and activities are ‘climate proofed’.It is pointed out that poor nations suffer most of the effects of climate change because of limited financial resources, skills and technologies and high levels of poverty. Adding to this, these countries, including Namibia, are also heavily reliant on climate-sensitive sectors such as agriculture and fishing. Research in Namibia suggests that annual loses to the economy could be up to 6 per cent of GDP over the next 20 years due to the impact that climate change will have on its natural resources alone.Namibia’s Natural Resource Accounts (NRA) helps to evaluate the contribution of the environment to national wealth by developing accounts for natural assets such as fish, forests, water and minerals. The data from the NRA can be fed into the conventional national economic accounts, which would potentially allow for sustainable development planning that includes.For this study, data from the NRA was fed into a computable general equilibrium (CGE) model, which uses actual economic data to determine how economies respond to policy or other changes. This revealed that under a best-case scenario, agricultural impacts would be partly offset by improved water distribution, and the overall GDP would fall by only about 1 per cent. Under a worst-case scenario, large-scale shifts in climate zones would reduce agricultural and fishing outputs, and the overall GDP would fall by almost 6 per cent over 20 years.In conclusion, the results of this study imply that climate change impacts in a natural-resource based economy are unlikely to be negligible, and the results might serve as guidelines for future policy directions, making sure that a worst-case scenario will not occur.