The aftermath of a wildfire in Doñana National Park, Spain © Antonio Jordán
If global warming continues unabated, it could wipe almost a quarter off per capita income by 2100, and the losses could be even higher in hotter and low-income countries, according to a new study.
However, global per capita income could increase by 0.25% if the climate goals set down in the Paris agreement are met, according to the study by Kamiar Mohaddes and Mehdi Raissi from the climaTRACES Lab at the University of Cambridge.
“No country is immune from the impact of climate change if greenhouse gas emissions are not curtailed…Urgent action is needed to address climate change and protect economies from further income losses,” the authors write.
The study predicted that hotter and low-income countries might face economic losses that are 30% to 60% higher than the global average.
However, it challenges the assumption by some economists that climate change is something that only hotter, southern countries need to worry about, with Canada and the US facing losses of up to 31% and 28% respectively by 2100.
Other rich countries will also be hard hit, including Saudi Arabia, the UAE, South Korea, Mexico, and Australia, with even cold countries like Sweden and Finland on track for significant losses to their GDP, the study shows.
“Climate change reduces income in all countries, hot and cold, rich and poor alike, and will affect industries ranging from transport to manufacturing and retail, not only agriculture and other sectors commonly associated with nature,” the authors write.
The study estimated that past warming of 1.2°C has already resulted in a global income loss of 2% or USD$1.6tn from above-norm temperature increases over 1960-2014.
The Network for Greening the Financial System (NGFS) has predicted that climate disasters could dent global economic growth by up to 3% within the next five years, but the damage could be limited if governments keep up efforts to promote a green transition.
The NGFS, a global group of 143 central banks set up in 2017 in Paris, has made long-term climate scenarios, which predict potential global GDP losses reaching 30% by 2100 under current policies, with tail risks of up to 50%.
This page was last updated October 1, 2025
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Emma Thomasson is a British journalist, consultant and trainer based in Berlin. She is an expert in economics, politics, business and technology. She previously worked for Reuters as a correspondent and bureau chief in Germany, Switzerland, the Netherlands, South Africa and the UK.
