Economic shocks stemming from rising sea levels pose a long-term risk to the sovereign credit ratings of dozens of countries that have large areas at risk of submersion, including Vietnam, Egypt, Suriname, and the Bahamas, Moody’s said on Thursday.
Climate science suggests that sea levels will continue to rise for decades, contributing to increasingly frequent natural disasters such as storm surges, floods, and cyclones, the credit rating agency said in a report.
Moody’s report on global sea level rise says Vietnam, Egypt, Suriname and some small islands face material credit risk, with sovereign credit profiles mainly affected through economic and fiscal strength. https://t.co/mqCvJMnaBw pic.twitter.com/0vEHvUjyNw
— Moody’s Investors Service (@MoodysInvSvc) January 16, 2020
“The economic and social repercussions of lost income, damage to assets, a loss of life, health issues and forced migration from the sudden events related to sea-level rise are immediate,” Moody’s said.
“Vulnerability to extreme events related to sea-level rise can also undermine investment.”
Farming, tourism, and trade are all threatened by rising sea levels, especially in countries with a large proportion of land and people at risk of submersion, including island states like the Philippines, Fiji and the Maldives.
While high-income economies, such as Japan and the Netherlands, are also exposed, they have countermeasures in place that mean their credit ratings are unlikely to be materially impacted, Moody’s said.
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