Climate change has resulted in negative implications for some sectors, such as agriculture, tourism and insurance due to extreme weather events and this has translated into significant economic impacts.
Agriculture: Changing climate patterns are harming crop and livestock, reducing income stability. Extreme weather events such as droughts and floods disrupt food production, further increasing the cost of production and reducing income. Investments in building climate-resilient practices need to be made but this also requires additional financial resources!
Tourism is a climate-sensitive sector. High temperatures, changing precipitation patterns, and more frequent extreme events can disrupt tourism—especially in coastal and island destinations—through impacts on beach tourism, water resource availability, heritage sites (including cultural and natural heritage), and transport (such as increased storm risks). Reduced numbers of tourists lead to decreased revenues for businesses and communities highly dependent on tourism and potential job losses.
Insurance: In view of the effects and the associated risks, the insurance industry is facing increase in risks and costs. Rising number of claims puts in pressure financial capacity of the industry what can subsequently cause escalation of costs for consumers as well as businesses.
In sum, climate change implies substantial economic costs for agriculture, tourism and insurance implying that adaptation strategies and investments are needed to reduce climate damages.