A new study by researchers from the University of Cambridge has concluded that 7% of global Gross Domestic Product (GDP) will disappear by 2100 as a result of business-as-usual carbon emissions, reinforcing the need for countries around the world to fully commit to achieving the goals of the Paris Agreement.

The research, published by the National Bureau of Economic Research and authored by researchers from the University of Cambridge, England, contests the prevailing economic assumptions that predict the burden of global climate change will primarily affect hot or poor countries, and which expects cooler or wealthier economies to be unaffected, or even to benefit from climate change. In reality, according to the authors of the new study, “virtually all countries — whether rich or poor, hot or cold — will suffer economically by 2100 if the current trajectory of carbon emissions is maintained.”

Further, and against the prevailing assumptions, the new research concludes that, on average, richer and colder countries would lose suffer as much economic loss to climate change as poorer and hotter countries.

Taking the United States and Canada as prime examples, the researchers showed that under a business-as-usual emissions scenario which sees average global temperatures currently projected to rise over four degrees Celsius by 2100, the US would lose 10.5% of its GDP by 2100, and Canada would lose over 13%.

Conversely, committing to and achieving the goals of the Paris Climate Agreement would limit the losses to both countries to under 2% of GDP.

On the whole, researchers expect 7% of global GDP to be lost by the end of the century unless “action is taken” immediately. Countries like Japan, India, and New Zealand will likely lose 10% of their GDP, Russia would lose 9% and the UK would lose 4%, while Switzerland could lose as much as 12% GDP by 2100.

“Whether cold snaps or heat waves, droughts, floods or natural disasters, all deviations of climate conditions from their historical norms have adverse economic effects,” explained Dr Kamiar Mohaddes, a co-author of the study from Cambridge’s Faculty of Economics. “Without mitigation and adaptation policies, many countries are likely to experience sustained temperature increases relative to historical norms and suffer major income losses as a result. This holds for both rich and poor countries as well as hot and cold regions.”

“Canada is warming up twice as fast as rest of the world. There are risks to its physical infrastructure, coastal and northern communities, human health and wellness, ecosystems and fisheries – all of which has a cost,” Mohaddes added. “The UK recently had its hottest day on record. Train tracks buckled, roads melted, and thousands were stranded because it was out of the norm. Such events take an economic toll, and will only become more frequent and severe without policies to address the threats of climate change.”

By looking closely at the United States, the authors were able to further highlight the ways in which the impacts of climate change will have adverse effects across the country’s economy.

“Cross-country studies are important for the big picture, but averaging data at national levels leads to loss of information in geographically-diverse nations, such as Brazil, China or the United States,” said Mohaddes. “By concentrating on the US, we were able to compare whether economic activity in hot or wet areas responds to temperature fluctuations around historical norms in the same way as that in cold or dry areas within a single large nation.”

Specifically, the authors looked at 10 sectors ranging from manufacturing and services to retail and wholesale trade across 48 US states and found that each sector in every state suffered economically from at least one aspect of climate change — be that heat, flood, drought, or freeze.

“The economics of climate change stretch far beyond the impact on growing crops,” said Mohaddes. “Heavy rainfall prevents mountain access for mining and affects commodity prices. Cold snaps raise heating bills and high street spending drops. Heatwaves cause transport networks to shut down. All these things add up.”

“The idea that rich, temperate nations are economically immune to climate change, or could even double and triple their wealth as a result, just seems implausible.”