Context: The United Nations ESCAP released the Economic and Social Survey of Asia and the Pacific 2025, warning that Asia-Pacific economies face significant macroeconomic risks due to intensifying climate shocks and insufficient readiness for green transitions.
Summary of UN-ESCAP Report – Economic and Social Survey of Asia and the Pacific 2025:
- Climate shocks could cause annual economic losses of at least 6% in a third of Asia-Pacific countries.
- The Asia-Pacific region contributed 60% of global economic growth in 2024.
- Countries Identified as Most Climate-Vulnerable (11 out of 30): Afghanistan, Cambodia, Iran, Kazakhstan, Laos, Mongolia, Myanmar, Nepal, Tajikistan, Uzbekistan, Vietnam.
- Climate-induced GDP losses: For 30 countries, Average Annual Loss (AAL) is 4.8% of GDP.
- Main causes of vulnerability:
- Infrastructure deficits
- Agriculture-dependent economies
- Rapid, unregulated urbanisation
- Inadequate disaster risk management
- Climate Vulnerability of Asia-Pacific Region:
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- Region faces frequent extreme events: floods, droughts, cyclones, heatwaves.
- Economic sectors most exposed: agriculture, energy, coastal manufacturing.
- Poorer nations lack climate finance, resilient infrastructure, and public finance capacity.
- Proposed Solutions in the Report:
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- Proactive Fiscal Interventions: Governments should shift investment towards high-productivity, green sectors.
- Climate-Smart Industrial Upgradation: Promote green value chains and sustainable production models.
- Regional Cooperation: Develop inclusive frameworks for shared green transition between developed and developing countries.
- Better Risk Assessment Tools: Adopt mechanisms like ESCAP’s Risk and Resilience Portal to track economic loss potential.
Relevance in UPSC Exam Syllabus:
- GS Paper 3 – Environment & Economy
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- Climate change impacts on economic growth.
- Sustainable development and green financing.
- GS Paper 2 – International Relations
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- Role of UNESCAP and regional climate diplomacy.
- Climate justice and global cooperation in addressing transboundary risks.
- Essay Paper:
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- Useful for themes like “Climate Resilience is Economic Resilience” or “Sustainable Development in the Global South.”
