Climate change poses a significant threat to global economic stability, leading to reduced incomes and extensive property damage.

The International Monetary Fund has warned that small island nations and coastal countries, particularly in South Asia, face extreme risks from climate change, with substantial expected economic losses.

Experts are emphasizing the urgent need for resilience strategies and effective domestic policies to mitigate the impacts of climate change on vulnerable economies.

The Asian Development Bank has projected significant economic losses for Bangladesh, Nepal, and the Maldives due to climate change, estimating that at least $73 billion in annual spending is necessary to combat its effects.

Bangladesh, which heavily relies on agriculture, is especially vulnerable, with projections indicating a 14.4% decline in income by 2050 due to climate impacts.

In Bangladesh, agricultural productivity is threatened by rising temperatures and increased soil salinity, which adversely affects key crops like rice and jute.

Record-breaking climate events, such as heatwaves and floods, are already inflicting damage on economies worldwide, with financial losses projected to range between $19 trillion to $59 trillion by 2050.

The United States and European Union are also expected to face significant financial impacts from climate change, with the U.S. potentially experiencing at least a 10% loss in GDP if no action is taken.

Scientific studies indicate drastic GDP reductions tied to temperature increases, with potential losses of 15% at 2.5°C, 25% at 3°C, and 30% at 4°C by the year 2100.

As climate-related risks, including credit and market risks, are expected to intensify over time, particularly during a disorderly transition, the urgency for action becomes even clearer.

The Potsdam Institute for Climate Impact Research has found that all countries, regardless of their development status, will experience economic losses as a result of climate change.

The interconnectedness of climate change and economic development is evident, as rising healthcare costs and declining labor productivity present additional challenges.