Research conducted by Alejandro De la Fuente of the World Bank and Monserrat Serio from the Universidad Nacional de Cuyo sheds new light on the vulnerability to poverty driven by climate risks in Latin America and the Caribbean (LAC). This study offers the first comprehensive analysis of populations in the region at risk of falling into poverty due to climate-related events such as floods, droughts, and extreme temperatures. Drawing on data from 15 countries, the study combines household income statistics with climate hazard indicators, revealing that 184 million people are vulnerable to poverty, with approximately 109.5 million structurally poverty-induced and 74.5 million risk-induced. Among the latter, 14.5 million are vulnerable specifically due to climate risks. The findings highlight significant disparities, with Peru, Colombia, and Honduras showing the highest vulnerability, while Uruguay and Chile are the least affected.
Identifying Drivers of Vulnerability
Using data from sources like the Socio-Economic Database for Latin America and the Caribbean (SEDLAC) and the Emergency Events Database (EM-DAT), the researchers employed a hybrid modeling framework to capture the effects of aggregate shocks like climate disasters and idiosyncratic shocks unique to individual households. The study differentiates between poverty-induced (PI) households, whose income falls below the poverty line, and risk-induced (RI) households, which remain vulnerable despite having higher incomes. This distinction reveals the disproportionate impact of climate events, particularly in rural and ecologically fragile regions where existing socio-economic conditions exacerbate vulnerability.
Idiosyncratic shocks and household-specific adversities such as illness or job loss were found to push more households into poverty than climate risks. However, addressing climate risk-induced poverty requires greater resources due to the far-reaching and persistent nature of these shocks. Guatemala and Honduras emerge as the most vulnerable countries, with over 70% of individuals facing some form of poverty vulnerability. In contrast, Chile demonstrates a notable proportion of households vulnerable despite earning above the poverty threshold, reflecting unique socio-economic dynamics.
The Role of Social Safety Nets
The study underscores the critical importance of social assistance programs in mitigating poverty risks. Countries like Peru and Uruguay achieve high coverage for vulnerable populations, with 95% and 86% of vulnerable households, respectively, benefiting from social assistance programs. However, significant gaps remain in other nations. For instance, Colombia and El Salvador provide little to no assistance to their vulnerable populations, while in Honduras, only 17% of vulnerable households receive support. The disparity in coverage highlights the need for equitable and effective social protection systems to address structural poverty and risk-induced vulnerabilities. Vulnerable households without access to such programs face increased hardship, particularly in the aftermath of climate disasters.
Targeted social safety nets are especially crucial for those affected by climate risks. In the Dominican Republic, for example, only 33% of climate risk-induced households receive social assistance. Even in regions with higher coverage, such as Brazil and Mexico, a significant proportion of climate-vulnerable households remain excluded from social programs. Bridging these gaps is essential to ensure that those most affected by climate risks receive adequate support.
Mapping Vulnerability and Climate Hazards
Through bi-mapping techniques, the study identifies regions where high poverty vulnerability intersects with elevated climate hazard risks. These maps provide policymakers with actionable insights into where targeted interventions are most needed. In Brazil’s northeast, for instance, high flood risks coincide with severe socio-economic vulnerabilities. Similarly, Central America and the Andean region exhibit high concentrations of poverty vulnerability and potential flood damages, emphasizing the need for region-specific strategies.
The study also distinguishes between the effects of sudden-onset disasters like floods and cyclones and slow-onset phenomena such as droughts and changing precipitation patterns. Countries like Mexico and Brazil demonstrate that slow-onset events may have a slightly higher risk-induced impact compared to sudden-onset disasters. However, sudden-onset hazards dominate in areas such as Argentina and Chile, where they are key drivers of vulnerability.
The Economic Costs of Reducing Vulnerability
The financial resources required to lift vulnerable populations out of poverty and mitigate climate risks are substantial. The study estimates that the average monthly income needed per person to overcome climate risk-induced (CRI) vulnerability ranges from $47 in Uruguay to $90 in Brazilian cities. Total annual costs for addressing these vulnerabilities represent significant portions of GDP in smaller nations like Honduras and Guatemala. For example, Brazil requires $547 million annually to address CRI vulnerabilities alone, emphasizing the scale of intervention needed.
While idiosyncratic shocks affect more households, the income required to address climate risk-induced vulnerabilities is notably higher, reflecting the deeper and more pervasive impact of climate events. The study also highlights the greater challenge of lifting climate risk-induced households out of poverty compared to idiosyncratic risk-induced ones. Addressing both requires coordinated efforts, robust social safety nets, and strategic investment in resilience-building.
A Call to Action for Policymakers
The findings emphasize the urgent need for coordinated policy responses to mitigate the growing threat of climate-induced poverty. By identifying high-risk areas and the socio-economic factors driving vulnerability, the study provides valuable tools for policymakers to design targeted strategies. Strengthening social safety nets, implementing climate adaptation measures, and enhancing disaster risk management are critical steps to reduce poverty vulnerability. The report also highlights the importance of fostering household and community resilience to address both direct and indirect effects of climate risks. This study serves as a vital resource for governments and organizations aiming to protect the most vulnerable populations in the face of escalating climate challenges across the Latin America and Caribbean region.
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Publish date : 2024-12-20 02:17:00
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