Climate Change Adaptation: A Temporary Economic Trade-Off for France

A French report anticipates a temporary economic slowdown due to climate change adaptation, costing France about one percent of its GDP by 2030. Despite initial costs, coordinated transition efforts to carbon neutrality are deemed essential to mitigate long-term damages and ensure a sustainable economy.

In a recent report, the French Directorate General of the Treasury has projected a 'temporary and moderate economic slowdown' as France adapts to climate change. The transition to carbon neutrality could reduce GDP by nearly one percent by 2030, given the economic impacts analyzed under different scenarios.

The nation aims for a 50 percent reduction in greenhouse gas emissions compared to 1990 levels by the end of the decade. Nathalie George, leading the Directorate's Macroeconomic Policy and European Affairs, stated that a coordinated transition will entail manageable economic costs.

The report identifies dual economic impacts: rising carbon taxes and production costs. Consumer prices may climb, decreasing purchasing power, while businesses may face elevated production expenses. Although initially challenging, the economic contraction is predicted to lessen by 2040, with potential recovery continuing through 2050.

(With inputs from agencies.)