Zenios Stavros A
University of Cyprus, Nicosia, Cyprus.
Cyprus Academy of Sciences, Letters and Arts, Nicosia, Cyprus.
Clim Change. 2022;172(3-4):30. doi: 10.1007/s10584-022-03373-4. Epub 2022 Jun 8.
The exposure of sovereigns to climate risks is priced and can affect credit ratings and debt servicing costs. I argue that the climate risks to fiscal stability are not receiving adequate attention and discuss how to remedy the situation. After providing evidence of divergent climate risks to advanced economies, I describe the transmission channels from climate change to public finance. Then, I suggest how integrated assessment models (IAMs) can be linked with stochastic debt sustainability analysis (DSA) to inform our understanding of climate risks to sovereign debt dynamics and assess the available fiscal space to finance climate policies. I argue for adopting the narrative scenario architecture developed within the IPCC to bring structure and transparency to the analysis. The analysis is complicated by deep uncertainty -risks, ambiguity, and mis-specifications- of climate change. Using scenario trees, narrative scenarios, and ensembles of models, respectively, we can deal with these three challenges. I illustrate using two prominent IAMs to generate the debt dynamics of a high-debt country under climate risks to economic growth and find adverse effects from as early as 2030. I conclude with the policy implications for fiscal stability authorities.
The online version contains supplementary material available at 10.1007/s10584-022-03373-4.
主权国家面临的气候风险已被定价，且会影响信用评级和偿债成本。我认为财政稳定面临的气候风险未得到充分关注，并讨论了如何改善这种情况。在提供发达经济体面临不同气候风险的证据后，我描述了气候变化对公共财政的传导渠道。然后，我提出如何将综合评估模型（IAMs）与随机债务可持续性分析（DSA）相联系，以增进我们对主权债务动态中气候风险的理解，并评估为气候政策融资的可用财政空间。我主张采用政府间气候变化专门委员会（IPCC）制定的叙述性情景架构，以使分析具有结构和透明度。气候变化的深度不确定性——风险、模糊性和错误设定——使分析变得复杂。我们可以分别使用情景树、叙述性情景和模型集合来应对这三个挑战。我用两个著名的综合评估模型来说明在气候风险对经济增长的影响下一个高债务国家的债务动态，并发现早在2030年就会产生不利影响。最后，我阐述了对财政稳定当局的政策影响。
在线版本包含可在10.1007/s10584-022-03373-4获取的补充材料。
