Bloomberg News

World Bank’s Kim Raises Sandy as G-20 Ignores Climate

November 06, 2012

Superstorm Sandy and the risk of more disasters sparked by climate change barely featured at a Group of 20 summit. Then World Bank chief Jim Yong Kim brought it up.

Addressing finance officials from the world’s leading economies days after the storm, Kim noted how media reports always write about once-in-a-lifetime natural disasters, according to an account of the closed-door meetings by Italian Finance Minister Vittorio Grilli. Yet in the last decade, there have been so many of them -- including 2005’s Hurricane Katrina -- the lifetime is getting short, he said.

“The World Bank has gone back to being in charge of climate change,” Bank of Italy Governor Ignazio Visco told reporters in Mexico City. “For a certain period from 2001, it had stopped.”

Ramon Fernandez, who heads the French Treasury, said Kim told delegates that climate change “is an important agenda that should not be forgotten while we’re all focused on crisis management.” French central bank governor Christian Noyer said Kim also referenced scientific reports.

Kim begins a two-day trip to Haiti today, where nine people died when the storm hit the Caribbean island.

Death Toll

In the U.S., the death toll from Sandy now stands at more than 100. Katrina, a category 5 hurricane that slammed into the coast of Louisiana and Mississippi and submerged parts of New Orleans, killed 1,833.

Amid the widespread expression of condolences, there was no attempt to calculate the storm’s damages or Sandy’s impact on the climate, said Grilli.

The largest Atlantic storm in history unleashed death and devastation up and down the U.S. Northeast, leaving millions without power. The economic cost could run as high as $50 billion, according to early estimates by Eqecat Inc., a provider of catastrophic risk models.

Still, making a causal link between Sandy and climate change has been a political minefield in the U.S. Global warming has been little more than a throwaway line in months of campaigning ahead of Nov. 6 elections.

Even in Sandy’s wake, President Barack Obama and Republican challenger Mitt Romney have brushed it aside.

Climate Change

Mayor Michael Bloomberg, founder and majority owner of Bloomberg News parent Bloomberg LP, brought it into the political arena as did New York Governor Andrew Cuomo, who said last week that “anyone who thinks there isn’t a change in weather patterns is denying reality.”

“Our climate is changing,” Bloomberg said in a Nov. 1 opinion piece published by Bloomberg View. “While the increase in extreme weather we have experienced in New York City and around the world may or may not be the result of it, the risk that it might be -- given this week’s devastation -- should compel all elected leaders to take immediate action,”

It’s a case environmental economists such as Robert Mendelsohn have been making for a while.

In a 2009 report supported by the World Bank, he said climate change is predicted to increase global damage from hurricanes. On average, damage from hurricanes is expected to increase by $10 billion per year, or 33 percent increase, according to the report.

Both Sandy and Katrina stemmed from low-pressure troughs off the coast of Africa, according to the National Hurricane Center. Both became tropical storms in the Caribbean, then hurricanes.

Nothing New

As for the G-20, climate change was mentioned near the bottom of a statement yesterday that had nothing new to say on the matter.

It recognized that the United Nations is the “forum for climate change negotiations and decision-making at the international level” and acknowledged that “climate finance is a relevant issue to be discussed.”

Europe and the U.S. have not seen eye to eye on climate change. The European Union has taken a leadership role in mitigating the effects of global warming by pioneering a regional carbon cap-and-trade system that extends beyond even the Kyoto Protocol’s requirements. By contrast, the U.S. has refused to support international efforts to curtail climate change and even lags China in green investments.

To contact the reporter on this story: Flavia Krause-Jackson in Mexico City at fjackson@bloomberg.net

To contact the editor responsible for this story: Joshua Goodman at jgoodman19@bloomberg.net


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