Extreme rainfall and more wet days will hamper global economy, study says

Climate affects the “economic growth story” and requires a response at the local, regional and international level, a climate scientist has told CNBC’s “Squawk Box Europe”.

Anders Levermann, who is head of the complexity science research department at the Potsdam Institute for Climate Impact Research, was speaking after a recent study published in the journal Nature found economic growth falls when the amount of “wet days and days with extreme rainfall” increases.

Scientists at PIK looked at data from over 1,500 regions between 1979 and 2019. In a statement last month, PIK said the analysis suggested that “intensified daily rainfall driven by climate-change from burning oil and coal will harm the global economy.”

The peer-reviewed study was led by Leonie Wenz, from PIK and the Mercator Research Institute on Global Commons and Climate Change.

“Economies across the world are slowed down by more wet days and extreme daily rainfall — an important insight that adds to our growing understanding of the true costs of climate change,” she said.

“While more annual rainfall is generally good for economies, especially agriculturally dependent ones, the question is also how the rain is distributed across the days of the year,” she added.

“Intensified daily rainfall turns out to be bad, especially for wealthy, industrialized countries like the US, Japan, or Germany,” Wenz said. PIK highlighted both the service and manufacturing sectors as being particularly affected.

Challenges related to excessive, heavy rain look to be here for the foreseeable future. According to the U.K.’s national meteorological service, the Met Office, as “global temperatures rise, the number of extreme rainfall days is expected to increase.”

Last summer, for example, heavy rain led to severe flooding in a number of European countries, causing deaths as well as significant damage to buildings and infrastructure.  

In response to what it called “catastrophic flooding and heavy rain”, Germany’s federal government said it would provide as much as 30 billion euros (around $34.3 billion) to assist parts of the country affected by the flooding.

During an interview with CNBC at the end of last week, PIK’s Levermann sought to highlight some of the study’s main takeaways.

“What we found … is that even small changes in the number of rainy days can already impact the growth rate of the economy,” he said.

“It’s the change in variability, the things we’re not used to, that really hit us strongest,” Levermann later said, adding that this was “difficult to adapt to.”

He also emphasized the need for a systemic shift over the coming years. “We know what the transition from a … fossil energy system to [a] renewable [one] will cost us, and it is a transition,” he said.

“We have to set the path straight so that people can actually adapt to it and make money out of doing the transition quicker than their competitors.”

It would, Levermann concluded, “always be more expensive to let climate change evolve than to combat it.”