The Importance of Climate Change: The Economic Cost of Caribbean Vulnerability

By Robin A. Montano and Dana Sookdeo

What is the climate crisis? 

The current global climate crisis refers to the long term negative changes that are taking place around the world as a consequence of climate change and global warming. Changes that are resulting in the modification of global temperatures, weather, and sea levels among other key environmental indicators. The consequences of these changes present an urgent threat to humanity as we know it, threatening our air, water, and food resources. 

There is much debate surrounding the phenomenon of climate change, with some schools of thought believing that it is a completely natural occurrence, whereas others believe climate change is brought on by man made activities. Although the argument that the climate crisis is brought on by natural occurrences – such as volcanic eruptions and changes in solar radiation due to the Earth’s orbit, is legitimate, research has shown that the crisis is mainly affected by human activities that extract and abuse natural resources and degrade the environment at an unsustainable rate. The main mechanism by which human activity contributes to climate change is through pollution and deforestation. 

How serious is the climate crisis? 

The gravity of the consequences of climate change are such that the phenomenon is better referred to as the climate crisis. The rapid changes in global natural environments puts at risk human health, wildlife and biodiversity and economic growth and development, to name a few. In the Caribbean region, as well as in many other developing countries, the society and economy depend largely on the natural environment that surrounds them. Climate change is likely to severely affect the Caribbean economies due to their biophysical and socioeconomic features, which render them extremely vulnerable to these impacts. This is due to each of these states being located somewhere in the hurricane belt, as well as the distribution of limited economic resources to communities. The consequences of the climate crisis means that there would be increased occurrences of landslides and floods, in addition to extended dry/rainy seasons, rising sea levels, and exacerbated effects of the Sahara dust. Furthermore, the region is reliant on a small set of economic activities, including agriculture and tourism which are closely linked to the environment, causing them to be susceptible to external shocks (ECLAC 2010). 

The effects of pollution on the climate crisis? 

Pollution and deforestation are human activities that are considered to be the drivers of climate change. The impact of land and air pollution bear many consequences on oceans and marine life, water scarcity and temperature rise. 

“Caribbean islands are the biggest plastic polluters per capita in the world” (Forbes 2019). The Caribbean region accounts for one third of the top thirty polluters per capita in the world, with Trinidad and Tobago being near the top of the list. The twin-island produces 1.47 kilograms per capita of waste everyday and has an ongoing prevalent issue of pollution. There is more marine plastic (from pollution) that ends up in Trinidad and Tobago’s oceans than 98% of the rest of the world. According to voluntary beach cleanups initiated by the Ocean Conservancy, many Caribbean countries have more waste than the overall global average. This realization is alarming as Caribbean islands depend largely on the sea for economic and human survival. 

Air pollution caused by the burning of fossil fuel plays a large role in the rising temperatures and increasing water scarcity. Carbon emissions caused by fossil fuel burning emits a large amount of carbon dioxide into the atmosphere, trapping heat and causing increased surface temperatures. Data shows that carbon emissions have increased by about 90% since 1970, with emissions from fossil fuel combustion and manufacturing activities accounting for about 78% of the overall growth in greenhouse gas emissions (EPA, 2021). In the Caribbean, much like the rest of the world, the need for safe and sufficient freshwater is colliding with the need for energy. Across the region, fossil fuel and power plants have been found to drain as much water as all Caribbean farms combined, and more than four times as much as every Caribbean household put together. More than 80% of this power plant cooling water originates from lakes and rivers, having a significant effect on local environments and often causing water supply stress and prompting water scarcity. 

Additionally, the clearcutting of mass amounts of trees is an ongoing problem in the Caribbean and  plays a critical role in exacerbating pollution. Research has shown that healthy forests trap carbon dioxide from the atmosphere and serve as important carbon sinks. Deforestation not only destroys natural habitats, but the absence of trees makes for a larger release of greenhouse gases into the environment. Deforested regions lose this capacity, causing more carbon to be released into the air, thus causing air pollution. This results in increased surface temperatures and can even contribute to water scarcity. 

The economic impact of polluted oceans and dying marine life in the Caribbean. 

Tourism is a major source of foreign exchange income and a leading export for many Caribbean islands providing much needed jobs and economic growth opportunities (UNWTO, 2010). The tourism industry is a core driver of growth in the Caribbean, accounting for 12.9% of subregional GDP and 14.1% of employment. Where associated businesses and indirect employment in tourism are included, the approximate contribution is three times as high. The tourism service in many Caribbean countries is derived from climate-sensitive habitats and natural environments (for example, reefs, beaches and rivers, and mangroves), making Caribbean tourism especially vulnerable to climate change. Coral reefs, a key characteristic of Caribbean tourism, and ocean environments are especially vulnerable as a result of ocean acidification and the rising sea surface temperatures. On average, 25-40% of tourists to the Caribbean participate in reef-related activities, implying that coral reef-associated tourism accounts for a large portion of overall tourism receipts for the region (Burke et. al., 2008). Coral reefs, in addition to their tourism purpose, play an important role in protecting the coasts of the islands and providing shelter for a variety of marine species, thus contributing to food protection and jobs for fishers. Burke and Maidens (2004) calculated that the potential losses of coral reefs in the Caribbean are estimated at US $870 million. Thus, the threat that the climate crisis poses to the Caribbean’s coral reefs can have effects on economic growth, unemployment, food scarcity, and susceptibility to natural disasters, such as tsunamis. 

Polluted oceans and dying marine life also hinders the developmental progress in the Caribbean region. Clean water is a key factor in economic development. Deteriorating water quality, caused by pollution has been found to worsen poverty and health conditions across the region (World Bank 2019)  

Considering the fact that phytoplanktons (which are cellular organisms found in the ocean) are responsible for producing up to 85% of the oxygen in the Earth’s atmosphere, polluting the ocean also has the potential to be detrimental to human health. Studies have shown that zooplankton, just like the majority of fishes and other marine life, are now ingesting microplastics in the ocean, killing them and threatening not only the marine food chain, but human life as well as these microplastics end up in the fish we consume. Investing in strategies to curb ocean pollution is therefore investing in the overall health of the population. 

The economic impact of water and food scarcity in the Caribbean 

Lack of access to clean water and sufficient food is already a prominent issue in many Caribbean nations, and other globally developing countries. The UN defines a country as water scarce if the country has less than 1000 cubic meters per capita of renewable water resources a year, and by this definition we find that Antigua and Barbuda, Barbados, St. Vincent and the Grenadines, and St. Kitts and Nevis are all classed as water scarce. Barbados finds themselves among the worst off, with only 350 cubic meters per capita, according to Keithroy Halliday, general manager of the Barbados Water Authority. 

The acts of polluting and deforestation in the Caribbean region has shrunk the region’s ability to achieve food and water security. Studies have proven that worsening levels of water scarcity can cause the region up to 6% of its GDP and can exacerbate food shortages. The agriculture sector in the region remains the most vulnerable to the effects of food and water insecurity. Agricultural productivity is harmed by extreme heat, droughts, floods, rising sea levels and storms, which, in turn, can cause food price hikes, inflation and income losses. 

For islands such as Trinidad and Tobago, though the sector accounts for less than 1% of GDP, it has been the subject of the country’s economic diversification strategy in recent years. The expected rise in air temperature caused by climate change is likely to increase soil aridity, lowering crop yields. Increased temperatures will lead to the spread of new and emerging pests and diseases, as well as an increase in the demand for water for irrigation. These agricultural threats are of great concern to Caribbean islands, who are currently attempting to improve their economic environment. 

Water and food scarcity also bear many negative consequences for economic development in the region. Human health and progress are most likely to be affected as the inability to feed the population and provide clean and adequate water grows. This has a ripple effect as human productivity then decreases which in turn costs people their jobs and income. As income decreases, the ability to survive also decreases. In the period from 2011 to 2016 approximately 20% of the CARICOM population was considered to be undernourished. 

The impact of global warming on the economy in the Caribbean 

Due to the fact that Caribbean countries are typically warm, increases in the temperature can hinder economic development. The agriculture sector, which accounts for a large percentage of GDP in the Caribbean, is particularly sensitive to these changing temperatures. Further to the changing temperatures, global warming also implies changing weather patterns. Meaning that the Caribbean may experience more unpredictable rainy/dry seasons. For a farmer, especially small farmers or subsistence producers, unpredictable climates have detrimental effects on the production of crops – too much rain can drown certain crops, and not enough rain can lead to a loss of crop. The result is that increasing temperatures and unpredictable weather patterns will lead farmers to be unable to consistently produce a crop yield that is enough to support their households. Lower crop yields leads to less household income, which can plunge more families into poverty, and can have the national (or even regional) effect of exacerbated food scarcity. 

A study on St. Lucia’s agricultural sector reinforces this point, with results demonstrating that so much as a 1% decrease in annual rainfall is expected to cause an approximate 0.27% decrease in the growth of banana exports, while a 1% increase in temperature is expected to yield a 5.1% decrease in the growth of banana exports. In other words, 1% increase in temperature, or a 1% decrease in rainfall, has detrimental effects on St. Lucia’s banana production. With current global projections for changes in temperature and rainfall, by 2050, the cumulative yield losses for banana production is expected to be about US$ 61 million, regardless of the scenario. This is just one example of how global warming will impact the Caribbean’s agricultural sectors, and by extension the people working in this sector. 

Increasing temperatures also plays a role in the hindrance of economic development in the region. Poverty reduction efforts and progress in human health have been reversed due to increased global warming. Although a global problem, poor nations bear the brunt of the negative consequences as they are more vulnerable due to their reliance on natural resources and their poor ability to deal with climate variability and extremes. Since the poor are more vulnerable and ill-prepared to cope with the effects of natural disasters, they suffer more than the wealthy. This results in a vicious spiral of increased poverty and income inequality. Climate change increases the occurrence and magnitude of adverse weather conditions, including droughts, flooding, landslides, and hurricanes, it is possible that there will be more deaths, fatalities, infectious disease cases, and psychiatric illnesses. An elevated mean temperature may also lead to more frequent heat waves and a higher rate of heat stress, which can lead to sickness and death.

Concluding Statements

 Throughout this article we produced evidence that demonstrates how human actions such as pollution and deforestation contributes to the climate crisis and poses multiple social and economic threats to the well-being of people in the Caribbean region. Many nations and states, such as Canada and Hawaii, have begun the process of recognizing the climate crisis as a matter of national security, and therefore a climate emergency. The negative impacts that this crisis poses to Caribbean islands are so broad that it is impossible to mention everything in a short article. In addition to understanding the economic and social costs of climate change, we must also attempt to understand the regional progress towards climate change mitigation, and what policy options exist to educate, adapt, and mitigate the oncoming impacts of the climate crisis. We are currently at a stage where it is of utmost importance to take urgent action at every level, from the individuals and households to national governments and the wider region. It is important to understand that protecting the environment is protecting the nation’s health, poverty reduction progress, and economic progress.  


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