Climate change could wipe $25 trillion from global economy, says study

But small rise in temperatures could benefit some investorrs

Climate change could wipe $25 trillion from the global economy according to new research by academics from the London School of Economics.

The study, published in the respected scientific journal Nature, takes aim at claims that regulatory pressures on fossil fuel extracting companies are hitting global economies, by arguing that without increased regulation, the economic impact would be far worse.

The report finds that currently $2.5 trillion – roughly 50% of the estimated stock market value of fossil fuel firms is currently at risk from the impacts of climate change.

However, in worst case scenarios with higher rates of global warming, the report says that up to $25 trillion is at risk.

The report adds that controlling climate change, so that we see no more than a 2 degree rise in average temperatures, could actually grow the planet’s financial assets.

“Limiting warming to no more than 2 °C makes financial sense to risk-neutral investors—and even more so to the risk averse,” it says.

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