By 2070s 150 million people will be at risk; exposed assets in Miami alone will be over $3.5trn
As many as 150 million people in the world’s major cities could be reliant on flood defences by 2070 – more than three times the 40 million people today – as a result of climate change and urban development.
This is according to a major new study by the OECD and jointly authored by Risk Management Solutions (RMS) and leading academics from the University of Southampton, the Tyndall Centre, Météo-France and the Centre International de Recherche sur l’Environnement et le Développement (CIRED).
The cities with the highest value of property and infrastructure assets exposed to coastal flooding caused by storm surge and damage from high winds today are primarily in developed countries.
The top ten cities, which contain 60% of the total exposure, are from only three wealthy countries (US, Japan, and The Netherlands), with Miami ranked as top.
Miami remains at the top of the 2070 rankings, with exposed assets rising from approximately $400bn today to over $3.5 trillion.
However, the rapid economic development expected in the nations under development means that in future the highest exposure becomes more concentrated in Asian cities, with eight of the top ten situated in this region.
Guangzhou is the second most exposed city in terms of assets, followed by New York, Kolkata, Shanghai, Mumbai, Tianjin (China), Tokyo, Hong Kong, and Bangkok, respectively.
“As insurers and business expand their business in Asia, public and private investment in adaptation will be critical to sustaining long-term financial stability
Dr Celine Herweijer
“These findings deliver a clear message to businesses that invest, or are planning to invest, in highly exposed cities to start implementing pro-active risk management strategies that consider how risks will evolve over time,” said Dr Celine Herweijer, principal scientist of future climate at RMS.
“For the insurance industry, there is both an opportunity and a necessity to promote adaptation. Crucially, rising hazard does not have to translate into increased risk if the right measures are taken.”
She added: “Where risk is today privately insured, incentivising adaptation amongst policy-holders will serve as a double pay-back for insurers. Likewise, as insurers and business expand their business in Asia, public and private investment in adaptation will be critical to sustaining long-term financial stability.”
The study shows that around half of the total population exposure to coastal flooding caused by storm surge and damage from high winds is contained in just ten cities.
“Population growth and development are clearly key drivers of the increase in exposure, particularly in Asia, but climate change and subsidence acutely magnify the problem,” commented Dr Herweijer.
“The concentration of flood exposure in rapidly developing cities urgently underscores the need to integrate climate change implications into both national coastal flood risk management and urban development strategies,” said Professor Robert Nicholls, IPCC author and director of research at the University of Southampton.
“Given the aggregation of people and assets in port cities and their importance to global trade, failure to develop effective adaptation strategies would inevitably have not just local, but international economic consequences.”
“Given the aggregation of people and assets in port cities and their importance to global trade, failure to develop effective adaptation strategies would inevitably have not just local, but international economic consequences
Professor Robert Nicholls
The annual probability of a 1-in-100 year event affecting one major city globally is as high as 74% and almost 100% over five years.
“Even being optimistic that flood protection levels will be high everywhere in the future, the large population and asset exposure is likely to translate into regular city-scale disasters across the globe,” said Stéphane Hallegatte, economist at Météo-France and CIRED.
“Adaptation strategies need to be underpinned by solid governance, to help key cities understand and proactively manage current and future flood risk.”
“This report raises crucial policy considerations, and highlights the urgency for climate change mitigation, and risk-informed adaptation strategies at a city level,” said Jan Corfee-Morlot, senior policy advisor on climate change at the OECD.
“Mitigation will slow and limit the exacerbating effects of climate change on coastal flood risk, at a minimum bringing precious time for cities to implement adaptation measures.”
Putting effective disaster management strategies and protection investments into place will take time. Previous defence projects, like the Thames Barrier in the UK, have demonstrated that implementing coastal protection infrastructure typically takes at least 30 years.