World Bank Warns Climate Threats Could Undermine The Gambia’s Economy Without Urgent Investment in Jobs and Resilience

According to the report, if The Gambia follows an ambitious growth and resilience pathway, the country could significantly reduce projected economic losses caused by environmental hazards.

The World Bank Group has issued a stark warning that climate and environmental pressures are already threatening jobs, productivity, and economic growth in The Gambia, while outlining a roadmap for how targeted investments and policy reforms could dramatically reduce future economic losses and create new employment opportunities.

In its newly released Country Climate and Development Report (CCDR) for The Gambia, the World Bank places jobs, livelihoods, and economic resilience at the center of the country's long-term development strategy, arguing that climate adaptation is no longer just an environmental issue but a core economic imperative.

The report highlights how rising temperatures, flooding, coastal erosion, and other climate-related risks are increasingly affecting agriculture, infrastructure, businesses, and urban development across the country.

"The CCDR shows that The Gambia can reduce future risks and unlock new opportunities through targeted investments and sound policies that protect people and support long-term economic growth," said Franklin Mutahakana, World Bank Group Resident Representative for The Gambia.

According to the report, if The Gambia follows an ambitious growth and resilience pathway, the country could significantly reduce projected economic losses caused by environmental hazards.

Without major intervention, climate-related threats could reduce GDP by as much as 9.3 percent by mid-century. However, the World Bank estimates that strategic resilience investments and reforms could lower those losses to approximately 2.6 percent — a difference with major implications for employment, poverty reduction, and economic stability.

The findings underscore the growing economic consequences of climate change for vulnerable African economies already facing development challenges, population growth pressures, and infrastructure gaps.

Agriculture remains the backbone of The Gambia's economy and labour market, accounting for approximately 70 percent of national employment.

The report says climate-smart agricultural reforms could substantially improve productivity and rural livelihoods.

By combining improved farming techniques, irrigation expansion, and market reforms, agricultural yields could increase by as much as 40 percent, helping strengthen food security while supporting rural jobs and incomes.

Agricultural resilience is viewed as especially critical given the country's vulnerability to drought, erratic rainfall, soil degradation, and rising temperatures.

The report also highlights the central role of small and medium-sized enterprises (SMEs) in driving employment and economic activity.

SMEs account for roughly 80 percent of businesses in The Gambia, yet only about 15 percent currently have access to formal financing.

The World Bank says improving credit access, lowering energy costs, and expanding affordable financing mechanisms could help businesses scale operations, create jobs, and invest in new sectors, including recycling and composting initiatives linked to a more circular economy.

The report suggests that green economic opportunities could become an increasingly important source of employment growth if supported by stronger infrastructure and financial systems.

Banjul, the country's capital and primary economic hub, is identified as another major area of concern.

The report warns that with businesses, infrastructure, and economic assets heavily concentrated in and around Banjul, the city faces significant exposure to flooding, coastal erosion, and climate-related disruptions.

The World Bank argues that protecting Banjul through both short-term adaptation measures and long-term urban planning will be essential for sustaining economic activity and investor confidence.

This includes preparing for future inland urban expansion while strengthening transport systems and electricity infrastructure to support continued economic growth.

Reliable and affordable energy is identified as one of the most important foundations for future job creation and private investment.

Although The Gambia has already achieved approximately 90 percent electricity access, the report says accelerating progress toward universal electricity coverage and improving energy reliability will be critical for industrial development, entrepreneurship, and economic diversification.

Transport infrastructure is also highlighted as essential for maintaining economic connectivity and supporting trade and investment.

Tourism — one of the country's most important industries — is another central focus of the report.

The sector contributes around 20 percent of The Gambia's GDP and supports approximately 15 percent of employment nationwide.

The World Bank says targeted reforms and investment could help tourism generate more stable, higher-quality jobs, particularly for young people and women, who face disproportionately high unemployment rates.

The report frames climate resilience and economic development as deeply interconnected goals, arguing that long-term prosperity will depend on The Gambia's ability to build infrastructure, financial systems, and labour markets capable of withstanding future shocks.

To achieve these objectives, the World Bank estimates that The Gambia will require approximately $11 billion in long-term investment by 2050.

A major portion of that financing is expected to come from increased private sector participation, which the report says should rise to around 35 percent through blended finance mechanisms, governance reforms, and policies designed to attract long-term investment.

The findings reflect a broader shift in international development policy, where climate adaptation is increasingly viewed not simply as environmental protection but as a critical strategy for economic resilience, employment generation, and poverty reduction.

Development experts note that countries like The Gambia — with high climate vulnerability and rapidly growing populations — face some of the world's greatest challenges in balancing development needs with climate resilience.

The World Bank argues that decisive investment now could help the country avoid far greater economic and social costs in the future while creating new pathways for inclusive growth and job creation.