The Australian economy will lose more than $3 trillion over the next 50 years if climate change is not addressed, according to a new report from Deloitte Access Economics.
The report titled A new choice: Australia’s climate for growth said if net-zero emissions policies are adopted by 2050 it could create 250,000 jobs and add $680bn to the economy while keeping global warming to 1.5C. On the flip side, it wrote that if Australia stays on its current track, the economy could shrink by 6 per cent over the next 50 years and 880,000 jobs could be lost.
It was also suggested that Australia may experience an economic hit on par with Covid-19 every year by 2050 if the climate crisis was not addressed.
Chris Richardson, Deloitte Australia’s chief economist, said the experience of Covid showed the cost of overlooking “catastrophic risks”.
“It’s an urgent wake-up call for us to get ahead of that other big risk: climate change,” he said.
“Australians need policy and regulatory reform that modernises our economy and unleashes business investment. The benefits of acting are huge, but we are fast running out of opportunity.”
Mining new minerals for new technologies, supporting innovation in advanced manufacturing and investing in upgrading and replacing infrastructure were options among the recommended “high growth industries” the report found to help tackle the climate crisis.
This is the latest in a growing push from the Australian business sector to encourage the Government to consider a “green recovery” out of the Covid-19 pandemic, and move towards net-zero emissions state.
Pradeep Philip, the report’s lead author, and policy director for former prime minister Kevin Rudd said reaching net zero emissions by 2050 to limit global heating was an “economic necessity”.
“Whatever Australia does or doesn’t do, the global warming which has already taken place will hurt our lives and livelihoods. This cost is locked in – it is the cost of delay,” he said.
The report found that reaching net zero emissions would reduce Australia’s GDP by $90bn by 2050. However, as Mr Philip said there “isn’t a ‘no-cost’ option”, the report outlines the effectiveness of a green approach in preventing the next great recession from climate change.
“For comparison, the current jobkeeper program is costing the federal budget just over $65bn this year alone – and this is the necessary price Australia is paying to minimise the worst economic consequences of Covid,” it said.
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