By NEIL HARTNELL
Tribune Business Editor
Climate change impacts could cost the Bahamian economy almost $500 million annually by 2025, the Inter-American Development Bank (IDB) has warned, with “badly designed” infrastructure and coastal erosion increasing the threat.
The IDB, in unveiling a $26 million project designed to improve the ability of the Bahamas’ coastline and associated infrastructure to withstand climate change, highlighted the growing danger for this nation’s key economic assets and industries.
Its report, which has been obtained by Tribune Business, warns that “a recent study” shows flood prone areas in Nassau will expand by 8 per cent come 2050, due to increased rainfall created by climate change.
While not huge, such a percentage is significant on an island that is just 21 miles long and seven miles wide, with numerous areas - as shown by Hurricane Matthew - already prone to flooding during heavy rainfall and major storms.
The IDB report also warned that more than one-third of the Bahamas’ hotels and airports, and 90 per cent of its ports, would be placed “at risk” by a one-metre sea level rise induced by climate change.
And, in just over eight years, it predicted that climate change impacts could be costing the Bahamas and its economy anywhere between $240 million to $480 million annually - figures that increase to $310 million to $620 million by 2050.
“There are various estimates of economic costs associated with these climate change impacts,” the IDB warned in the Bahamas’ case.
“For example, under a low impact scenario, the projected annual costs would be $240 million billion by 2025 (4.2 per cent of 2004 GDP) and $310 million by 2050 (5.3 per cent of 2004 GDP). Costs double under a high impact scenario.”
Suggesting that threats to the Bahamas’ coastline, ecosystem and coastal infrastructure were only “likely to worsen” as a result of climate change, the IDB report emphasised that this nation is “highly vulnerable” to such effects.
“A recent IDB study indicates that the probable flood exposed area in Nassau will expand 8 per cent by 2050 due to the increasing precipitation caused by climate change,” it added.
“Nationally, a one metre SLR (sea level rise) would place 36 per cent of major tourism properties, 38 per cent of airports, 14 per cent of road networks and 90 per cent of sea ports at risk.”
Recalling recent history, the IDB said Hurricane Sandy had inflicted a $702.8 million cost on the Bahamas in 2012, even though this nation largely escaped the worst of the storm.
And, even though Hurricane Joaquin last year impacted just 1.5 per cent of the Bahamas’ total population, it caused $104.8 million in damage by scoring a direct hit on five Family Islands.
“The Bahamas is highly vulnerable to natural hazards, including hurricanes, which put at risk both economic activities and associated public infrastructure concentrated along the coast of New Providence and several of the Family Islands,” the IDB said.
“From 1990 to 2015, the country experienced 15 major hurricanes, affecting 27,000 citizens. Hurricane Sandy, although low intensity, had a total economic cost of $702.8 million (9 per cent of GDP).
“Recently, Hurricane Joaquin, which passed through southern islands comprising only 1.5 per cent of the total population, destroyed large segments of five islands with total damage estimated at $104.8 million. Damages are exacerbated by inadequately designed infrastructure non-compliant to building codes.”
With 80 per cent of Bahamian land just one metre above sea level, and spread out over a 668,000 square kilometre territory, the IDB report acknowledged that combating climate change’s impact will not be easy.
For that reason, it is concentrating $20 million of the project’s funding - the bulk of the monies - on “four priority sites”, where it will “reconstruct critical public infrastructure” and develop engineering solutions to stabilise the shoreline and control flooding.
These areas are Nassau and New Providence; Eleuthera’s Glass Window Bridge; central Long Island and east Grand Bahama.
“The coastal and marine environment not only dominates the landscape of the Bahamas, it is also a critical component of the economy and Bahamian identity,” the IDB said, pointing to how heavily dependent the tourism industry is on its continued stability.
“Nassau, a major port of call, received over 4.7 million passengers in 2015, many attracted by the coast’s scenic quality and recreational attractions,” the IDB added.
“An estimated $1.8 billion of direct tourist revenues were generated in 2015, with a total economic impact of $4.1 billion (46.9 per cent of GDP). Tourism accounted for 55,500 jobs directly in 2015 (28.9 per cent of total employment).
“The tourism sector’s potential future growth rests predominately on the uniqueness and health of the archipelago’s coastal resources.”
Describing the Bahamas’ coastal and marine resources, and their ecosystems, as this nation’s “natural capital”, the IDB said the likes of reefs, mangroves and wetlands were key barriers to storm surges and flooding.
“Beyond tourism’s economic impact, the Bahamas’ coastal and marine ecosystems provide other benefits that have value to human well-being (ecosystem services) but are not easily monetised, such as coastal protection, carbon sequestration and cultural values,” the report added.
“A study in Andros found that implementation of a plan leveraging ecosystem services to fill development gaps could reduce the length of shoreline at risk from erosion and flooding by 20 per cent.”
The IDB continued: “The loss of natural capital in the coastal zone exacerbates the archipelago’s overall environmental and socio-economic vulnerability.
“While information on the Bahamas’ natural capital is limited, there is evidence of declining trends and increasing threats. For example, Bahamian reefs have less live coral cover on average than other Caribbean island reefs.
“Mangrove wetlands of the Bahamas are threatened by land conversion for development, and because they are not fully protected by law. Data on beach stability are collected sporadically and not reliable.”
While the Bahamas had the necessary legislation in place to facilitate the project, the IDB warned: “The implementation of the regulatory framework for Environmental Impact Assessment and ensuring sustainability of public works is limited, including policies related to consultation and access to information.”