Canada’s economy could shrink 6.9% per year by 2050, the world’s most industrialized economies could drop 8.5%, and developing countries will fare far worse if governments don’t deliver on the faster, deeper carbon cuts they promised in the Paris Agreement, Oxfam and the Swiss Re Institute warn in an analysis released on the eve of this week’s G7 summit in Cornwall, UK.

The G7 stand to lose US$4.8 trillion per year by mid-century if average global temperatures rise 2.6°C, as they’re on track to do based on countries’ current climate commitments, and the “human and economic impact on low-income nations will be much worse,” Oxfam Canada says in a release.

“The pandemic has caused G7 economies to shrink by an average of 4.2%, resulting in staggering job losses—especially for women, who have also shouldered increased care responsibilities—and required some of the largest economic stimulus packages ever seen,” the organization states. “Yet, G7 economies are expected to bounce back from the short-term effects of the pandemic. In contrast, the effects of climate change will be seen every year, and are already having disproportionate impacts on women around the world due to gender inequalities that increase their vulnerability to climate-related risks and disasters.”

Oxfam points back to recent World Bank research that showed climate impacts pushing another 32 to 132 million people into extreme poverty by 2030.

Swiss Re’s modelling looked at 48 countries and found many of them facing far more serious losses than the G7. It concluded that the combined, chronic effects of heat stress, health impacts, sea level rise, and lost agricultural productivity will produce GDP losses of:

• 35% in The Philippines;

• 27% in India;

• 17.8% in South Africa;

• 16.7% in Colombia;

• 12.5% in Australia;

• 11.4% in Italy;

• 9.7% in South Korea.

“Climate change is the long-term number one risk to the global economy, and staying where we are is not an option—we need more progress by the G7,” Swiss Re Group Chief Economist Jerome Haegeli told The Guardian. “That means not just obligations on cutting CO2, but helping developing countries, too—that’s super-important.”

For developing countries, the path to local solutions leads through wealthy nations’ unkept promise to begin contributing $100 billion per year to international climate finance as of 2020. G7 finance ministers recommitted to that target over the weekend, but left it to summit leaders to hammer out the details.

“Oxfam estimates the G7’s current commitments amount to $36 billion in public climate finance by 2025, with only a quarter ($8 to $10 billion) of that for adaptation,” the Oxfam release states. Canada is under pressure to increase its share to a fair-share contribution of US$4 billion per year. But the country “has yet to announce whether it will increase its climate finance commitment, or whether it will offer greater support in the form of grants to countries seeking to undertake gender-responsive climate adaptation amidst spiralling debts made worse by the pandemic.”

“Recognition that ambitious climate action is a precondition for a healthy economy now and in the future has yet to result in Canada and other G7 nations committing to the levels of emissions reductions that are required to keep the goal of limiting temperatures to 1.5°C within reach,” Oxfam Canada Climate Policy Specialist Anya Knechtel told The Energy Mix in an email. “That’s why Oxfam is highlighting the need to benchmark climate action not only by its direct implementation cost, but also by the cost of inaction. While the pandemic has given us a sense of the economic hardship that can be wrought by global crisis, projected losses due to climate change—particularly among developing countries—are significantly worse.”

“The climate crisis is already devastating lives in poorer countries, but the world’s most developed economies are not immune,” added Oxfam Great Britain CEO Danny Sriskandarajah. He called on the UK government to “strain every diplomatic sinew to secure the strongest possible outcome at the G7 and COP 26, and lead by example by turning promises into action and reversing self-defeating decisions like the proposed coal mine in Cumbria and cuts to overseas aid.”