Conveying climate statistics

A RECENT STATEMENT by the chairperson of the Net-work for Greening the Financial System (NGFS) sparked an interesting conversation.

- AKHILESH TILOTIA

She was quoted as saying that unchanged global climate policies could cost India 19% of its GDP and the world 15% by 2050. These numbers are stark: how should numbers like these be interpreted and communicated?

The NGFS is a group of 144 central banks contributing to the development of environment and climate risk management in the financial sector, and to mobilise mainstream finance to support the transition to a sustainable economy. NGFS climate scenarios explore a range of plausible outcomes: the fifth iteration was released in November 2024. They provide a common and up-to-date reference point for understanding how climate change (physical risk) and climate policy and technology trends (transition risk) could evolve in different futures.

Note that forecasters, especially of the deep future, point to median numbers: the range for India's fall in potential GDP in 2050 ranges from ~10% to ~30%. India's economy is currently projected, across a range of forecasters, to grow at a baseline rate of, say, 7% per annum, while the world economy is expected to grow at 2% annually. Most of these forecasts do not explicitly take into account any climate damage function. With these basic data points, let's see what conclusions can emerge.

Different ways to communicate data