Skip Navigation


June 8, 2021
By Tim Worstall

Global Reinsurer, Swiss Re''s climate report is misleading, presenting estimates of the costs of climate change while ignoring the economic benefits of continued fossil fuel use.

From the study:

According to a new report by Swiss Re1 – heavily promoted by the media and also by Oxfam2 – ‘the world stands to lose close to 10% of total economic value by mid-century if climate change stays on the currently-anticipated trajectory’.

This is not true.

The correct statement is that in 2050, global GDP– total economic value – will be lower by 10% in the presence of climate change damages than in the absence of them. But that’s not the same as a loss of that economic value. For what also needs to be included is the growth in economic value between now and 2050 that results from whatever economic policies are followed in the period. It is the nett effect of these two processes that will determine living standards in 29 years’ time. The mistake throughout the Swiss Re report is to fail to consider this basic piece of logic.

In fact, the report's authors choose to present information in a manner that obscures that this is what they have done. All of the calculations presented are of the loss of GDP as a result of damages. There are no – quite absurdly, none at all – numbers on what GDP will actually be in that near future.