Covid-19 is not turning out to be a ‘great leveler’ of the rich and poor. Like most crises, lower-income households are hardest hit and lower-income countries face the most significant long-term effects.

The poor struggle to maintain social distancing when seeking assistance during the pandemic. Photo: ADB

We can expect to see a similar pattern of inequality in a different but imminent problem: the adverse impacts of climate change. Lower-income households and countries will eventually recover from the disruptions caused by Covid-19, only to be faced with chronic disruption from the rising impacts of climate change. It will be difficult, if not impossible, to sustain long-run inclusive growth against such headwinds.

Covid-19 could cost the global economy between $2 trillion to $4.1 trillion or between 2.3% and 4.8% of global gross domestic product (GDP). Further longer-term losses could accrue through prolonged outbreaks and follow-on effects. Long-term climate change is estimated to reduce global GDP per capita by 7% by 2100 with annual adaptation investment costs in the range of between US$70 billion and US$100 billion.

The pandemic is a current and acute crisis with identifiable and tangible impacts, while changes in climate are distributed over time and geography, are very difficult to forecast, and even harder to identify and attribute. However, for both, warnings had been raised of their risks and the lack of global preparedness.

Most crucially, we can expect that the poorest communities and countries are likely to face disproportionate risk from both Covid-19 and future climate impacts, for several reasons:

Higher physical exposure. Poorer households, particularly in lower-income countries, are likely to contain more people but in smaller dwellings, limiting their ability to practice social distancing and increasing the risk of transmission. They are less able to work from home, leading to a stark trade-off between health and income. Similarly, such households are likely to live and work in less protected locations exposed to climate-related natural hazards such as floods and extreme heat. Land-locked countries like Afghanistan and Small-Island Developing States like Palau are particularly prone to these effects.

Lower access to institutions and finance. Institutions in lower-income countries are less able to monitor, evaluate, and respond to the outbreak and climate-related disasters, leading to less efficient and effective responses. These countries may already have high levels of debt stress with limited headroom to further borrow and implement fiscal stimulus measures. Investment in vital infrastructure needed for long-term resilience will be delayed in favor of immediate Covid-19 response measures. Poorer households have less access to quality public and private services for healthcare, finance, and social safety nets, due to lower state capacity, lack of affordability, or longer travel distances. They will have less savings and access to credit to tide them over.

Knock-on effects. The secondary effects of Covid-19 and future climate change may well be the longest-lasting. Lower-income countries may rely on tourism or remittances from overseas, exposing them to additional adverse impacts faced by neighboring countries. Food security will likely be threatened by Covid-19 due to disrupted labor supply and value chains. These same countries may face lower agriculture productivity due to disrupted water availability and crop yields as climate change gains momentum. Prolonged closure of schools will likely have long-term impacts on attainment for an entire generation of students, particularly those from poorer households.

It is imperative that the global response to Covid-19 be a template for action as well on climate change resilience. Here are some approaches to help achieve this:

 -   Evaluate, learn, and apply. The Covid-19 outbreak has generated an avalanche of new and quickly-published research to inform infection control and disaster response. As climate change resilience investments and activities grow, we increasingly will need to monitor and evaluate their impact on the poorest and most vulnerable communities and adjust accordingly, to ensure value for money. The experience of Covid-19 can help us evaluate quickly, produce more actionable results, and share more effectively.

 -   Inclusive growth, governance, and safety nets. Governments have announced measures to support financial markets, health care systems, and social safety nets. Implementing them requires strong participatory governance. These same measures could provide a platform for increased resilience to climate change impacts, which is heavily correlated to income. Our responses to pandemics and climate change should both prioritize the continued economic growth of lower-income countries and access to quality social support by the poorest households.

 -   Reevaluate risk tolerance. Governments acted with urgency to Covid-19. But could we have been better prepared, given earlier warnings? Similarly, global action on climate change to date has arguably lacked urgency despite dire warnings of its impacts. The pandemic is an opportunity for countries to reconsider their tolerance and approach to risk and their priorities for disaster risk management and climate change.

 -   Bring in and scale up the private sector. The Covid-19 response has seen a surge of rapid actions by the private sector, from provision of medical and personal protective equipment to research into vaccines. Similarly, the private sector must be supported to play an increased role in climate resilience, through (among others) novel and more accessible insurance and finance, provision of relevant information services, and development of new practices and technologies in vulnerable sectors such as agriculture.

Developing countries face the double threat of pandemic and rising climate impacts. By making the global response to Covid-19 a springboard for action on climate change resilience, we can narrow the divide between rich and poor and keep everyone safe.

*Nathan Rive is Senior Climate Change Specialist, Central and West Asia Regional Department, ADB.