London’s economy at risk from extreme world weather

Published today, 23rd July 2015, the London Assembly Economy Committee report ‘Weathering the Storm’, looks into the impact of climate change on London’s economy in terms of risks and opportunities.

The key findingas are:

  • London’s businesses are ill-prepared for climate change risks - 54 per cent of FTSE 100 firms have no business adaptation strategy in place for climate change.
  • Evidence suggests that 60 per cent of small and medium sized businesses have no plan in place to deal with extreme weather conditions.
  • London’s investment dependence on fossil fuels is a growing risk. It’s time for responsible financial investment away from coal.
  • The capital’s status as a global city makes its economy increasingly vulnerable to climate change – we not only face extreme weather like flooding, drought, heatwaves at home, but we also ‘import’ risks through the insurance sector, overseas investments and our international supply chains.

Jenny Jones AM, the report author and former Chair of the Economy Committee, said: “Too little is being done to understand and prepare for the potential costs of climate change. London faces a great unknown when it comes to how our supply chains and economy will be hit by extreme weather events. For example, the damage from the 2011 floods in Thailand, where IT component parts are made, meant much higher prices across the global IT industry, including in London.[4] A much worse situation would be if too many harvests failed and affected our food supply.

Detailed work is absolutely essential to secure London’s future economic prosperity. We need to diversify London’s economy and further invest in our green economy. That way, our city will be stronger and more resilient whatever the level of future global warming.”

The report makes a number of recommendations, including:

  • Little work has been done to establish the full impact of extreme weather events on London’s supply chains. The London Climate Change Partnership should map the major supply chain vulnerabilities of London’s economy.
  • The Mayor should drive forward a resilient low carbon economy for London by promoting skills in this area and encourage innovation in the green economy.
  • Climate change adaptation should be integrated into the Mayor’s Economic Development Strategy, as currently it doesn’t feature.

Downland the Report here

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