Current trends in global development will bring “catastrophic climate change, devastation to nature and biodiversity, debilitating land degradation and desertification, and lingering deadly pollution”, warns a new report by the United Nations Environment Programme (UNEP).
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However, increasing investments to address four key environmental crises – climate change, biodiversity loss, pollution and land degradation – can add trillions of dollars each to global economies, reducing hunger and poverty, UNEP’s seventh Global Environment Outlook report showed.
“While there are upfront costs [to addressing these crises], the economic cost of inaction is much higher,” UNEP said.
The report is based on the work of 287 multidisciplinary scientists, making the report “the most comprehensive scientific assessment of the global environment ever carried out.”
According to the data, current business-as-usual pathways – which would see the extraction of resources including biomass, fossil fuels, minerals and metals rising 70 per cent from 2020 to 2050 – will result in an increase of average global temperatures above 1.5°C in the early 2030s.
“On this path, climate change would cut 4 per cent off annual global GDP by 2050 and 20 per cent by the end of the century,” UNEP said. This estimate, however, excludes health impacts, biodiversity loss related to climate change and tipping points, “meaning the real damage to GDP would be higher.”
Current scientific projects could also be underestimating the magnitude of climate change, warned Sir Robert Watson, former co-chair of the Intergovernmental Panel on Climate Change (IPCC) and Intergovernmental Science-Policy Platform on Biodiversity and Ecosystem Services (IPBES).
“In the last decade, the world has been warming faster than we would have projected from [the older] models,” he told reporters ahead of the UNEP report launch. “We’ve exceeded 1.5°C in the last two years. The last ten 10 years have been the hottest on record.”
“We’re not saying the IPCC models are wrong – [what we’re observing is] within the range of the IPCC models, but possibly towards the top end of the climate models,” he said.
Watson and fellow expert Professor Edgar E. Gutiérrez-Espeleta, president of the United Nations Environment Assembly, emphasised that these changes will have far-reaching economic and social issues.
“We can no longer view these environmental issues as simply environmental issues. They’re economic issues,” said Watson. “It doesn’t matter whether it’s climate change, loss of biodiversity, land degradation or pollution, they’re all undermining our economy.”
The UNEP report said that an annual investment of about US$8 trillion until 2050 is needed to achieve net-zero emissions by 2050 and ensure adequate funding for conserving and restoring biodiversity.
Comparatively, the loss in services from ecosystem degradation could grow as high as US$44 trillion annually, it found.
Urgently looking beyond GDP
While the UNEP report still used the term gross domestic product (GDP) to illustrate the financial gains of investing in a more sustainable environment, it also called for a shift away from using GDP to measure the health of global economies.
“Governments must move beyond GDP worship,” said Gutiérrez-Espeleta, who is also the former minister of environment and energy for Costa Rica.
“The problem is that if you destroy a forest, that is going to be recorded as a plus in GDP,” he pointed out. “We have to consider other areas, [other] vulnerabilities…the multidimensional poverty index, for example.”
Gutiérrez-Espeleta’s comments build on an initiative launched by United Nations Secretary-General António Guterres’ in May 2025 that convened 14 global experts in trade and economics to look at metrics to measure a country or economy’s progress beyond GDP.
Last year, Gutiérrez-Espeleta was also part of a panel that developed the UN’s Multidimensional Vulnerability Index, which was created to help financial institutions measure the risks of nature-related disasters.
He said that countries, companies and financiers need to restructure incentives and redirect capital towards sustainable development. This includes more than US$1.5 trillion in harmful subsidies, including for fossil fuels, and pricing in over US$45 trillion in negative externalities, such as the costs of pollution.
“The science is clear. The solutions are known. What is required is courage, courage to act at the scale and speed that [the future] demands,” said Gutiérrez-Espeleta.
