Asia’s Dragon Economy at Risk of Losing $1.6 Billion in 11 Years Due to Unavoidable Reason

A recent study conducted by the National University of Singapore (NUS) has revealed that rising temperatures could result in an economic loss of up to $1.64 billion by 2035. The impact of this phenomenon has already been felt in 2018 when Singapore experienced extreme heat, leading to a decline of 11.3% in the average productivity of its major economic sectors: services, construction, manufacturing, and agriculture. Unfortunately, the situation is only expected to worsen.

The Project HeatSafe Report: Economic Consequences of High Temperatures

According to NUS’s Project HeatSafe report, the expected reduction in productivity by 2035 is estimated to be around 14%, resulting in an economic loss of $2.22 billion (adjusted for inflation). This will have a particularly severe impact on workers who are exposed to unfavorable environmental conditions such as working under the scorching sun or operating high-heat machinery.

The report further estimates that for every hot day, the hourly productivity of workers decreases, leading to an average income loss of $21 per worker. Project HeatSafe is not only the first large-scale research project of its kind in Singapore but also in the entire region, aiming to evaluate the effects of rising temperatures on productivity, individual health, and overall macroeconomic performance.

Rising Temperatures: A Global Concern

Singapore is not the only country facing the challenges of extreme heat. In early February, scientists warned that the world had surpassed a critical threshold in global warming for the first time in a year. In July of last year, United Nations Secretary-General Antonio Guterres emphasized that the world had transitioned from global warming to a “global heating era.”

Beyond the impacts on awareness and physical activity, NUS’s research also highlights the risk of high temperatures to Singapore’s historically low fertility rate. The study uncovered that prolonged exposure to excessively high temperatures could pose risks to the country’s birth rate, which is already at a historically low level.

This alarming situation calls for immediate action to mitigate and adapt to rising temperatures. Governments, businesses, and individuals must come together to find sustainable and innovative solutions to combat the adverse effects of climate change on the economy and overall well-being.

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Source: CNBC